Liabilities
Saturday, Mar 17, 2007
One last point about frugality and then I’ll move on with the blog. I just think it’s important to elaborate on the subject because there are moms who want to be at home with their children instead of in the workforce. I don’t think it’s enough to send messages without explaining the “how to.” They write, “Yes, I want to stay home with my children, but how can we afford it?” or “Yes, I want to have one more child, but how do I do it without going crazy? I’m already crazy.”
When I began this blog, it wasn’t intended to encourage and equip women to be the best mothers that they could be. I don’t think my time has come for that yet. Instead, I want to post pictures and brag about how cute my kids are. I want to give my father-in-law something to read. I want to tell you the stories that I know. And so, here is another quick story on the subject of frugality:
I held a lot of odd jobs while I was putting myself through college. One particularly memorable one was when I worked for a CPA. I did the billing for his practice, and so I trust you’ll believe me when I say that he was a very rich man. He was the richest guy I knew.
The funny thing about him, though, was that he drove a beat-up old VW. It wasn’t old in the classic sense; it was old in the embarrassing sense. Every one of his employees drove a nicer car than him. (I was the only other one who drove a car from former decades, but it wasn’t because of my good sense. It was because I was scraping by.) When he drove home and parked in the driveway of his mansion, you’d assume that the car belonged to the hired help.
Now, I’m not saying that voluntary poverty is next to godliness and everyone should buy junk. I just learned an important lesson during that time—that wealthy people invest in their savings into appreciating assets (real estate, mutual funds, starting new businesses) and minimize putting money into liabilities or depreciating assets (vehicles, clothes, furniture). One reason the “rich get richer and the poor get poorer” is because wealthy people can differentiate between appreciating and depreciating assets. If I am poor, I want it to be because of the Lord’s hand and doing and not because I buried my talent into the ground.
Now, obviously the Scotts aren’t exactly brilliant. After all, we own a seven-month-old Boxer who is not yet earning his keep. Talk about a depreciating, money-guzzling liability! I can’t say that you all didn’t warn us.
17 Comments
RSS feed for comments on this post. TrackBack URI
Leave a comment
« Previous: A penny saved is more than a penny earned
Next: Technology on our front door »
Return Home
I just bought the book The Millionaire Next Door (at our library sale for $1.00). I haven’t read it, yet, but I skimmed a chapter that talks about millionaires who are quite frugal. I guess Sam Walton was famous for driving an old truck.
Comment by Brenda@Coffeeteabooksandme (March 17, 2007 @ 12:54 pm )
In the stage production Anne of Avonlea, when the young people are canvassing for donations, the character Fred Wright has a quotable line to this effect:
I think people who have lots of money get that way because they don’t give it away readily.
Comment by Rebecca (March 17, 2007 @ 1:15 pm )
Awwww! Now sweet Knoxer the Boxer will start pulling his weight very soon… about another year or so. Hold on! His time is coming. He’ll be worth it!
And, I wholeheartedly agree with your great post - as usual!
Comment by Lady Why (March 17, 2007 @ 1:20 pm )
Amy–
Come now. Of *course* your time has come to encourage and equip us….you do it so well..
And thanks for these words of wisdom. I really appreciate your take on frugality.
Comment by Andrea (March 17, 2007 @ 5:30 pm )
Reference Comment #1: The “Millionaire Next Door” is an excellent book that is not selling get rich schemes. It does a great job of recommending how to avoid expenses from interviews with millionaires. Go to Amazon and read some of the reviews on this book.
Comment by John (March 17, 2007 @ 7:45 pm )
Ditto on the Millionaire next door. I listened to the abridged version on cassette a few years ago. Now I’m listening to the unabridged cd version along with my oldest son. Oh, and I got them from the library–how’s that for frugal?
Your eyes will be opened by the statistics he cites about how millionaires really live–nothing like what you’d see on Dallas, Dynasty, or Falcon Crest. (Yeah, I’m old, and have no idea what today’s version of those shows would be.)
It’s good to read/listen to stuff like that every so often to help strengthen your resolve to live frugally. Everywhere you look, our culture screams consumption. You have to be very intentional to live differently than the masses. Dave Ramsey tells folks to live like nobody else today so that you can live like nobody else tomorrow. (ie frugality today=prosperity tomorrow)
Comment by Jo (March 17, 2007 @ 10:27 pm )
My own family is a living testimony to the way your boss lived. We didn’t live in a mansion though! We had a very modest three bedroom/one bathroom home in a very moderate neighborhood. I grew up thinking we were the “poor” kids on the block because we didn’t go out to eat much or get new things all the time. Not that I ever felt sorry for myself, there was no reason for that. I was surprised when I found out that my dad made more than the other families where both the mom and dad worked. He was just frugal.
This frugality I have carried with me throughout my life. My husband, Kent, is cut from the same piece of cloth also. And, surprise, surprise, all four of our children are frugal nuts…except when they can talk their grandpa into taking them places and buying them things. He certainly plunks his dough down for them far quicker than he ever did for us. I love it, so do they, and truth be told, so does Grandpa.
Comment by Laurie (March 17, 2007 @ 10:46 pm )
LOL, we have a mutt that isn’t earning his keep either. Thanks for posting this, it really makes me think about where I am in life. And to think some laugh at my beat up 10 year old car. Ha!
Comment by Gibby (March 18, 2007 @ 1:08 pm )
These posts on frugality have been excellent and full of good, solid advice. I think the reason most people aren’t willing live poor so they can become rich is that they want to look and feel rich now, which means they have to spend money now. Madison Avenue is relentless. Thank you for encouraging us to look past this moment.
Comment by Amy T. (March 18, 2007 @ 5:31 pm )
Speaking of bragging about your kids–PLEASE put that adorable picture of your children back on your site!! I loved seeing their cute faces when I came to your post.
Kelli
Comment by Kelli (March 18, 2007 @ 7:23 pm )
however, there are different kinds of frugality.
there is smart frugal.
and then there is plain ol’ stingey frugal.
smart frugality is tempered by a generosity of spirit.
it’s an important distinction, don’t you think?
Comment by Elizabeth (March 18, 2007 @ 9:58 pm )
[...] and another good point here [...]
Pingback by a little wisdom about money « The Seattle Krombeins (March 19, 2007 @ 1:28 am )
I agree with Elizabeth.
While some of us need to be encouraged to save, others of us need to be encouraged to give.
The best investment we can make is not in real estate or mutual funds, but in love and in the Kingdom of God.
I’m trying really hard to learn this and put it into practice.
John Piper says there are three levels of how to live with things. You can steal to get, you can work to get, or you can work to get in order to give. He says too many Christians live at the second level (work to get), even though the Bible pushes us to live at level three (work to get in order to give). Piper says, “The issue is not how much a person makes. Big industry and big salaries are a fact of our times, and they are not necessarily evil. The evil is in being deceived into thinking that a $100,000 salary must be accompanied by a $100,000 lifestyle. God has made us to be conduits of His grace. The danger is in thinking the conduit should be lined with gold. It shouldn’t. Copper will do.” (From his book, Desiring God)
Comment by ruth (March 19, 2007 @ 11:29 am )
Amy, I have seen links to your site all over the blogosphere, but as a new mom, I have had to limit my exploration a bit. So today my was first chance to explore your site. Wow. Good stuff you have here. Even if your intent is not to “encourage and equip” you certainly have a gift for it. And I will certainly be back for more.
Comment by Charlotte (March 19, 2007 @ 12:03 pm )
We have a 7mo. old beagle puppy and I think the fact that he cleans up under the highchair is priceless! Totally worth it to me (of course, my oldest dd has to clean up the occassional accident, otherwise I’d probably change my tune:)
Blessings!
Comment by Tara L. (March 19, 2007 @ 1:50 pm )
Tara, Our dog doesn’t like crumbs. He’ll eat a Cheerio, but not a smashed Cheerio. He’s on thin ice.
Elizabeth and Ruth, you make important distinctions. Amy D. makes the case for frugality in her Tightwad books, carefully distinguishing between hoarding/stinginess and careful spending. Ruth, thanks for sharing that Piper quote.
Kelli, I haven’t had a chance to find where I put that other banner. But I agree, I like it much better!
Comment by Amy Scott (March 19, 2007 @ 2:44 pm )
I found your site through Barbara Curtis, who links to you from time to time. I enjoyed your recent post on frugality as I have others of yours. I am reading “Rich Dad, Poor Dad” by Robert Kiyosaki, which talks about the principles you mentioned- the key point being able to distinguish between assets and liabilities. It’s a very interesting and amusing read.
Comment by Melissa (March 26, 2007 @ 8:27 am )