Thursday, August 30, 2012

Lessons I Could Learn from My Younger Self - Value Cash

Recently I've been thinking about my relationship with money and spending, particularly how it has changed since I've grown up. The value of a dollar has been altered in my mind, and I think that it was my younger self who had it right. So over the course of this week, I want to explore some of the things that I had right as a kid.

First, as a child I valued cash. I think that this is pretty common among children. Money is something foreign to kids; as a kid, you only receive money if an adult gives it to you. Thus, money serves as a gateway into the world of adults. Think about your first memories regarding money. Despite the fact that it was most likely a very small amount, it would fill me with a sense of power. Even a penny meant something to me. I remember getting a dollar from the tooth fairy and feeling like I owned the world. I remember thinking that if someone had $100, they were most certainly rich.

Since I valued money so much, I found it very difficult to spend. I remember one year I really wanted to get a new bike. When I made this request to my parents, my dad said, "Well, then you better save up." I had absolutely no idea how much a bike cost, but I knew that it was A LOT. I saved my money for months in a little container - money from doing chores, the odd found quarter, gifts, profits from lemonade stands. I remember opening up my little bank to add the money, and feeling euphoric at the sight of the folded bills. I would take them out and carefully count them, wondering when I would have enough for a bike. I would lift the container to feel it grow heavy from the weight of the change. Finally, I felt like I certainly must have had enough.

I remember bringing my bank to my parents, and we counted it together. At this point it was around $19. "Well," I asked my parents, "Can I get a bike now?" They then informed me that I really wasn't even close to having enough money for a bike. Part of me was disheartened, but I also was incredulous. How could a bike cost more than the $19 that I worked so hard for? What a rip off! I didn't even want it anymore, and I made do with the hand me down bike that I had, until I was surprised one Christmas with my own brand new bike. Since I knew that this bike obviously cost a fortune, I was thrilled to have it.

I remember adding money to that little container for quite some time, getting up around $100. Even though I wanted things, I barely spent that money. When I would be out with my parents and request some toy or another, they would tell me that I should use the money I had been saving. It very rarely seemed worth it.

I'm not sure when it happened, but I eventually strayed from that mindset. An older version of me, broke into that little container that I had worked so hard for and spent the money. Granted, it did take awhile to get through, but eventually it was all gone. I have no idea what I even bought.

As an adult, I don't even deal with cash. I very rarely have cash in my wallet, and when I do it is always from some random occurrence. Instead, I use my credit cards for everything. I always pay by balance so I never pay interest, but it is true that using a credit card just doesn't have the same sting as using cash. I have been trying to get into the habit of using cash more frequently, but I really would love to get back to the mindset of my young self and ask myself a crucial question before I make a purchase.

Is this (bag/ pair of shoes/ necklace/ makeup/ DVD/ etc) really worth trading my hard earned cash for?

Most of the time, if I'm honest with myself, the answer will probably be, "No."


J. Money said...

Brilliant story (and oh so true!). Really enjoyed reading this. a lot :)

mirko said...

Very nice story. I can easily see myself in that same aspect. Why did I have to buy all that crap for my 'racing car' in my 20's.... ;(

Anny said...

Thank you for sharing! I keep my emergency $20 in my wallet but pay for everything cash. Paying with credit hurts me more :P

"Since I knew that this bike obviously cost a fortune, I was thrilled to have it." made me laugh

camorra said...

Ha, I definitely feel that. Once I got plastic, my bank account dropped $1000 within the course of 3 months. Considering that I was in high school with no income, that was about 1/3 of my net worth. Lesson learned: don't let other people spend your money. (At least 2/3 were spent on other people who "forgot" their wallets - I'm in college now and I haven't even come close to depleting that much)