Living on $12,000 a Year

I read this article recently on MSN Money. It was titled “How I survive (actually thrive) on 12K year.” It was sitting right next to an article called “Scraping by on $150K a year”. Quite a contrast, huh?!? So I read them both. When you read these articles one after the other you realize that we really do choose our own paths regardless of any limitations set by the outside world.

The first was a single lady, recently divorced who had decided to go back to school. She had a set income that included alimony and some money left over some school grants. Her rent for the year totaled $6,000 and some change. Yet she pays utilities, eats, has car and health insurance, and enjoys her life because she knows every dollar coming in and going out and has no stress about it.

The second is a couple with 4 daughters. Now granted it costs a lot more to take care of 6 people than 1, so to be fair based on the other lady 12X6 is $72,000. They are making twice that. So where is all their money going? Apparently a rental property that they have been holding for some time and not been able to rent out. They have been cutting tons of little things out of their budget such as coffee at starbucks, etc. trying to fix the problem. Now I commend them for seeing there is a problem and something has to be done, however do you think they possibly drink enough starbucks coffee in a month to pay a mortgage? Most likely not! So each month they ignore what is draining their budget and can’t figure out where all the money is going.

So many of us live like this. FEAR. Fear of not paying our bills, fear of something happening and not having enough money. Sleepless nights thinking about money. But I would say given a choice of either of these lives, I would take the $12K and eat beans and be happy, rather than the $150K and all the stress it causes. The point is, it is human nature to spend everything we have, but if we learn the habits of living on less and implement them regardless of what our current financial situation is we will get more restful nights.