Anyone remember when you had to have enough cash in your wallet if you wanted to buy something or else produce ID to use a cheque at the store??
I remember standing in line forever as every third person would write a cheque and dig through their wallet or purse for ID. Can you imagine watching someone today write a cheque at Wal-Mart?? Crazy!
I also remember, when I first started working, heading to the Bank every second Friday, with thousands of others, to deposit my cheque. Luckily, the Teller was really cute and I didn’t mind…
I had to do that because there were No ATM’s. Were you born right after WWII Brian? Not quite…
For the most part, we enjoy evolving as a society and introducing modern conveniences that make our lives easier. Now, I can do most of my banking online, I have direct deposits and I can use credit and debit cards to pay for things (and it’s about to get even easier where you can do most of this right on your phone).
But what is the price we pay for these ‘conveniences’?
Many years ago, when I was in University, I got a phone call to participate in a survey and I said yes (I was studying for exams and I’d do ANYTHING to take a break). The survey was how I felt about introducing credit card machines at gas stations so you didn’t have to go inside to pay (Would you believe I went to University when I was 9??!!)
I told them I didn’t think it was a good idea and the survey person was shocked. “You are the first person to answer this way…do you mind if I ask why?”
I said I thought that this ‘convenience’ of being able to use credit cards to buy stuff at more and more places was destroying the realization of only being able to buy what we can afford. People could choose to pay for things on plastic without having to think about whether they actually had the money to pay for it. They would worry about that later or just continue to borrow from the credit card companies that were more than happy to charge massive interest.
Well…here it is many years later and my prediction came true (should have become a fortune teller). We have an epidemic of people who misuse credit and get themselves so down in a debt hole, they may never fully get out in their lifetimes (as I say on my home page, we all leave something behind for the next generation…inheritance or debt).
Smart, educated people have little clue how to manage money. The government is forever warning us of the dangers of household debt amounts yet credit card companies and banks are allowed to loan people more and more money that the borrower can’t afford to pay back.
Kids these days use debit cards for anything and everything while their parents re-fill the account…and they never learn the lesson most of us learned as children…if you buy the first thing you want, you won’t have any money to buy something else that you might want or need later on. The account never runs dry and they just keep spending.
The next generation has no clue about the ‘value’ of money and what it means to only buy things they can actually afford and parents are perpetuating this problem for them.
And I believe it is our society of ‘convenience’ and being removed from the process of paying for things in cash, balancing our chequebooks and saving up the money to buy something BEFORE you actually buy it that has contributed to this.
So I am not against debit and credit cards (I use both)…but I believe there are lessons to be learned and habits to create BEFORE all this convenience is utilized.
I grew up with the lesson that I had to have the money first, then I could buy something or pay for my basic needs (food, clothes, AC/DC records…). If I blew my money in the first week of the month, I had to wait and go without until the next month (or paycheque).
And these lessons are what enable me to be financially independent today and not be a slave to some company that has loaned me money and I must repay for years and years.
In other words, I am free. Sadly, most people are not.
In a future post, we’ll talk about Good debt vs Bad debt (because there is a significant difference) so you can learn and teach your kids how to utilize this misunderstood tool in life.
Drop me an email or call if you want to re-learn some important lessons and find out more about what options are available to you through Coaching.
You owe it to yourself to be Financially Free!