the shame and the glory

“Don’t feel the need to keep up with the Joneses” is one of the rallying crys of the personal finance blogosphere. I’ve always felt that someone who’s new to managing their money comes to this philosophy with a great deal of excitement.  You feel liberated the first time you buy a new cell phone/shoes/shirt and realize you don’t need the iPhone, or the Gucci loafers or the Boss shirt even though Fred in the next cubicle has all of those things.  You wear your boring old Motorola phone or Rockports or Arrow shirt, feeling slightly abashed, until you realize it doesn’t matter that much.  Nobody noticed.

But then it kicks up a notch. You start buying tubs of Maxwell House instead of Starbucks because, well, Starbucks is one of the villains of the personal finance world.  You reduce all of your consumption; you buy the cheap bottle of Scotch instead of a top-shelf brand.  You do it all because you don’t need to keep up with the Joneses, those fools.  But you’re drinking Maxwell and Two-Dollar Rosie and gloating over your retirement account.

We own two cars (one was an inheritance, and one we paid cash for). We share them, but “mine” is a 9-year old Pontiac.  It works, although we’ve had enough “small” problems with it recently to give us pause.  The problems have never affected the engine, though, so there’s no reason to get rid of it.  I’d like to get rid of it.  I’d like a smaller car with better mileage, but when I’m honest with myself, I would really just like a new car.  And I won’t, in large part because I don’t want to be “keeping up with the Joneses.”  We live in a neighborhood in which most families appear to have a one-German-car quota (at least), and I’m not talking about Volkswagens.  Our minivan and Pontiac are bringing up the rear in terms of car “status.”

You can be a vegetarian by eating nothing other than cheese pizzas and french fries. You’re missing the point of vegetarianism, of course.  You can also avoid “keeping up with the Joneses” by denying everything, but you’re missing the point of saving money there, too.  You don’t save money so you can save more.  You save money so you can spend it on things you value instead of things you don’t.  I know that as much as I might want a new car, it’s not going to make me happy.  But if I could keep up with the Joneses by buying a new car, and it made sense for my life, I might.  I work in an evironment where a lot of websites are blocked by my corporate client – a BlackBerry would make a lot of sense for my side businesses.  Any way I look at it, a luxury car wouldn’t.

I can’t say that saving money is wrong, but the more I read the more I wonder about the unnatural way even the “right-thinkers” have to behave these days. We live in a society where the government expects us – basically – to fend for ourselves on health care and retirement but exacts horrific taxes from us to pay for decades of wars, failed social programs and failed tax cuts.  Entrepreneurs are crippled by health care costs.  Corporate workers live in terror of retirement, and our tax dollars go to propping up executive bonuses at AIG.  I don’t mean to ease over to a populist rant, but at some point you have to wonder whether saving your money – particularly in the stock market – is just playing into their hands.

The “glory” is spending money on the things you love. The “shame” is avoiding spending money JUST to avoid spending money.  Don’t save JUST for the sake of saving.  Embracing dogma is short-sighted.  Keep up with the Joneses when it makes your life better.  You’ll know the difference.  I’ve seen people who saved enough for a bright future brought low by health troubles, and I’ve seen people who farted through life do just fine because they managed to have the good luck or geneaology to avoid health troubles.  You can only know the present.  Too many people avoid keeping up with the Joneses simply to deny themselves today.  I don’t buy the new car because I can use that money on something I love – my kids, my wife, a nice house – but not because I’m hoping that the saved money will save me in the future.  It may not.  Focus on benefit today, not a hoped-for benefit tomorrow.

photo by digital cat 