Tuesday, April 03, 2007

What's In Your Wallet?

While I was out bonding with the neighbors the other day, standing in a circle in the driveway with beers in hand (me with good beer, them with Busch), we got around to the subject of what things cost, and debt and student loans. My neighbor sells motorcycles, which he loves, but carries a student loan on a degree he doesn't use. His two buddies, who were standing around drinking and chatting with us, also have student loans on degrees they don't use.

I have five...count 'em, five student loans...but I actually work in the field for which I was trained. But the price I pay for all that quality public education is about $550 a month until...hmmm, let me think...until I die.

That's not Harvard Business School degrees we're talking about. That's a couple of state universities with in-state tuition.

I've reconciled myself to the fact that I'll be making easy payments on my student loans in perpetuity, but I'll be goddamned if I'm willing to make that kind of commitment to any other financial institution. So I don't have credit cards, and we pretty much try to pay cash for everything as we go.

When is it time to stop spending? When the cash is gone. It's easy. If we want it, we have to save for it.

But as I look around lowly Southern Illinois with it's poverty level wages, I can't help but notice how many people are driving around in $40,000 pickup trucks and Hummers and Escalades and building brand new $300,000 houses, and I keep wondering, "How in the world do they pay for that?"

I suspect that they pay for it by taking on a massive debt load that's only sustainable if everything goes exactly right. And since things never go exactly right, I'll bet there are a lot of people spending sleepless nights worrying about how they're going to keep their head above water.

My goal is to be able to retire someday. In order to do that, I need to not be in debt up to my eyeballs at age 65. So as I was talking to my neighbor, whom I love, I realized that our life strategies are completely different. He keeps encouraging me to stop tinkering with my 40 year old John Deere and buy a brand new one. I keep explaining that this one meets my needs, it's fun to tinker with, and it's already paid for.

To me that's a no-brainer. It's equally obvious that he's scratching his head over why I'd continue to mess around with that old thing when I could have a sleek new one with a radio and a cup holder for my beer.

But I'm at a point in my life when the coolest toys aren't worth the hassle of paying them off for decades...and by the time they're paid for, they're not cool anymore. My life strategy is to putter around my yard, go fishing, grow tomatoes, make wood projects and generally underachieve. If I have to work 80 hours a week to support my lawn tractor and Escalade, I'll be considerably less happy.

And isn't that what all that crap is supposed to do? Make us happy?

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