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Friday, August 15, 2014

Poor, Well-Off, or somewhere in between??

I've come to realize that people have different attitudes about money and being frugal. Note: "poor" means negative or zero net worth- "well-off" means positive net worth.

The (Frugal) Poor 
Make a little, spend a little
Some people are frugal because they really have to be. Maybe they've got a lot of debt to pay off, or they're a single-income household with lots of kids, or maybe they just don't make a lot of money. Some 'poor' people really enjoy being frugal, and other poor people see it as misery.

The (Non-Frugal) Poor
Make a little, spend what you can
These people might be poor, but ain't nobody gonna know it. They pretty much buy what they can afford. Money tends to run short, and when kids whine for new gadgets, they hear, "We can't afford it."

The (Frugal) Well-Off 
Make a lot, spend a little
These people don't really need to save money. They just get a kick out of saving, as opposed to the person who gets a kick out of buying. Money doesn't run short, even though they might drive an old beater car. When kids whine for new gadgets, they hear, "We don't need it."

The (Non-Frugal) Well-Off 
Make a lot, spend a lot
Some personality types are just big spenders. However, they also tend to MAKE a lot of money, which balances out the spending. They like flashing cash- via clothing, transportation, housing, gifts, etc. They don't understand why anyone would ever want to buy used ANYTHING. Let alone pick it out of a dumpster.


Obviously there are in-betweens and crossovers of these types; this is just a generalization. However, I think it's interesting that many Well-Offs are less interested in displaying wealth (think of the beater car), than Poors- many of whom like to display the little wealth they have plus a lot that they don't. Do you think there could be a correlation between being frugal and having wealth, or even a positive net worth? I wonder if the urge to display wealth keeps people from actually having any.

I fall under the Frugal categories. When I was single, I had a pathetic net worth. When I got married I upgraded a bit, as Hubs seems to be the better earner of the two of us. :/

Where do you fall on the spectrum?

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