FREE NEWSLETTER
I was sitting on the deck of my holiday home, enjoying the morning sunshine and breakfast, when a deep rumble announced the arrival of an expensive, sporty car. It was my neighbour. He’s a very nice man in his 40s who always dresses impeccably, with two well-turned-out kids and an immaculate wife – to all intents and purposes, a family living the dream.
Contrast that with me: I drive a seven-year-old SUV with 70,000 miles on the clock, habitually run around in shorts and T-shirts, own three pairs of trainers, one pair of dress shoes, and exactly one suit. It’s obvious there’s no comparison in who’s “winning the game of life”… or is there?
About 18 months ago, a conversation started when I mentioned I’d just paid off the mortgage because my wife was retiring. My neighbour then spoke with pride about his ability to juggle credit cards, expertly transferring balances with 0% transfer rates. However, he also revealed a concern about his own mortgage. As is common in the UK, his rate was fixed for five years, and with two years left on his 1.25% rate, he couldn’t see how he’d afford the jump to around 5%.
That nice car, the designer clothes, the immaculate facade – they all come with a hefty, often hidden, price tag. While my neighbour projected an image of success, his confession about juggling credit cards and his anxiety over the impending mortgage hike painted a different picture. This isn’t just about the obvious payments for the car or the latest fashion; it’s the relentless pressure to maintain a certain lifestyle. The “keeping up with the Joneses” trap is real, amplified by social media. People feel immense pressure to project prosperity, even if it means accumulating significant debt. This pursuit often takes a quiet but heavy psychological toll: the constant anxiety of making ends meet, the fear of exposure if the carefully constructed illusion crumbless, and the never-ending striving that leaves little room for peace.
I was going to offer some advice, but then I thought better of it. Who was going to listen to a guy in a scruffy T-shirt and shorts? Appearances, it turns out, can be very deceiving.
I wanted an immaculate wife but had to settle for a real one, alas. 🙂
Yesterday, on my way to the gym in my son’s older Mitsubishi which is far from flashy, but perfectly functional, I caught a glimpse of a few workout buddies pulling in with their sleek SUVs. For a split second, I wondered if they looked at me and saw someone “less than” because of the car I was driving. It wasn’t envy, more like a passing curiosity.
But then I took stock: I own my home outright. I’ve built a solid retirement fund. I’m 54 and financially secure. And most likely, none of them were even thinking about me that way. Still, that little inner voice whispered the doubt until I remembered one of Dave Ramsey’s classic rants about people living paycheck to paycheck in nice cars, while he was cruising debt-free with cash in the bank.
That thought settled me. By the time I drove home, I wasn’t thinking about anyone else’s ride, I was thinking about how peace of mind always beats monthly payments.
I don’t really know how much of my personal finance andvice over the years has “stuck” with my now adult children. But recently when discussing the financial anxiety she feels, my youngest daughter said to me “Mom, I remember you always saying that it is far better to actually HAVE money than to look like you have money.” I’m still waiting to hear from my other daughter….
Spending is usually visible, and wealth hidden.
In Psychology of Money Housel shares a story about his college job as a car valet. He realized people drooling over those expensive cars he parked are picturing themselves in it, not admiring the owner/driver.
His point: if you want respect and admiration, there are far more effective ways to achieve it than blowing precious cash on fancy things, ways which allow you to compound wealth over time through savings you keep from the gap between your income and your ego.