Maybe We’re Doing It Wrong

James Duffy

Photo by Avi Waxman on Unsplash

Maybe We’re Doing It Wrong

There’s no doubt we live in the greatest Country in the world. At least not in my mind. (And yes, I lived in 3 other Countries for a combined 7 years of my life; and if you count extended stays in Poland and Canada, even more. Every country and culture has something great to offer). The argument can still easily be made for the greatness of the US in many, many aspects.

Just look at the wealth and prosperity that the US has created for its citizens; as well as cultural achievements, technological innovations, health breakthroughs…and throw in the expansive natural beauty our Country offers, and most would agree. The US has produced more modern achievement than any other two countries combined.

We have a lot to be proud of, and quite a lot that prompts a true, deeply-rooted patriotism.

I discount none of that when I suggest there are times when we should pause, take stock, and make sure the path we follow as citizens building our lives may need a course correction.

Take a bird’s eye view with me for a moment.

Americans are Stressed

The news stories and anecdotes are everywhere pointing to Americans being more stressed than ever. And the stress goes into many aspects of life, financial, interpersonal, career, and personal aspirations, as this 2020 Penn State Study exhibits. The researchers concluded that Americans are decidedly more stressed now than 3 decades ago, in the 1990s.

A quick look at a reason for the stress we are under…including the weight of the inflating dollar.

At least in part, the stress we feel in the face of our finances today is evident when we look at the added costs that technological progress and society have deemed essential.

First, there is inflation.

According to the American Institute for Economic Research, $100 would buy in 1971 what it takes $647.65 today.

A very large increase, especially when compared with the median household income. Take a look at the US median household income, when adjusted for inflation:


So the median household income has risen, a little.

But think of the necessary costs that have been added, almost exponentially.

Today we have a cell phone…for every member of the family. And past a certain age, the cell phone is a necessity. That’s some $200-300 more per family per month. And wi-fi at home? Also necessary. And the monthly subscriptions to Netflix and Prime and Spotify and Lifelock and well, all the others are things we Americans did not have 50 years ago.

Here is a tell-tale graph of the cumulative inflation since 1971…the year we left the gold standard.


And now let’s compare that to the real wages chart:

The real wages are up, but nowhere close to the stratospheric levels of cumulative inflation.

I work in the housing market, so let’s take that as an example. In 1971 the median US household income was $10,622 a year, while the median home was priced at $25,500. Roughly 2.5 times the median annual income.

Today the median home price just hit $331,580 while in 2020 the median household income was $78,500. That home price is nearly 4.25 years’ income.

And everything else is similar. Inflation makes prices take up a higher percentage of income than 50 years ago.

Nothing is on the horizon to slow that trend.

Americans are in debt

If you are the average American, you live partly on your income and in part on debt.

The problem with that is two-fold, at least. First, the debt causes stress in all areas of life, including affecting our relationships and our health. Not to get too into charts…so here is one last one, showing the total indebtedness of US consumers, us, at the highest point…ever.

Source: NY Fed

The purpose of this article is to show collectively where we are and offer individual solutions. And where we are is that 80% of Americans live with debt, and that level of debt has grown past even the 2008 housing crisis levels.

Sure, we can argue in Platonic terms that ‘something needs to change’. Some readers may feel called to step into the public square and enter the political fray to try to enact change from a mothership point of view. And, more power to you, if that is your calling. I hope you do make the change.

But like a philosophical school of thought…that change, while needed, will take decades to filter down to the average American household. Handing back $1400 of our own money ain’t gonna do it.

So how do you get ahead, and become more prosperous than your previous generation?

Well, that is the question. Like we’ve suggested before, maybe we should not return to normalcy. Maybe we should embrace different.

Decrease Spending

The question is: What do you do about it?

And if stress keeps building, well, maybe it’s time for a change.

You know, a de-stress, a re-focus.

Life, as wonderful as it is, is just too short to live against a constant backdrop of angst.

I was speaking with a friend last week. He and his wife and two small children have recently moved to a different neighborhood, on an island nearby. His comment, “I love it. Nobody is trying to outdo, outspend, anybody else. Everyone is just accepting of everyone else.” [Note: We live in the Low Country. There are lots of islands.]

Utopia? Maybe.

Marketers have gotten really good at making us believe that happiness will be ours, just after the next big purchase. The bigger house, the German car, the outdoor kitchen with a pizza oven (come on…you know in your heart you will not use the outdoor pizza oven more than 3 times.)

Even Giza Dream Sheets promise to make us happy. Bedsheets? Really?

But the marketers are really good at what they do. And we buy-in. After all, what’s the finality of life, if not happiness?

And we live in the America we live in, where 80% of us live with debt.

So breaking that requires a mental shift.

The first mental shift is to enjoy the process of building wealth more than the satisfaction of that shiny new thing.

Far be it from me to suggest that pulling up in the new Audi or stocking the new refrigerator with the transparent doors is not satisfying. It is.

Oh, and the boat with the spray of saltwater over you…very satisfying.

I’m suggesting that we enjoy the pursuit of the money to buy those satisfying things more than the purchase itself.

When the pursuit of wealth becomes fulfillment in itself, the resulting pleasure we take in wealth that things can give, while real, fades to a background of satisfaction.

Debt goes away.

Wealth is built.

Lookout at the boat moored in the marina, knowing you have to make next month’s payment not just on the boat, but also on the boat slip.

Now imagine gazing over the water, knowing the boat and the boat slip are paid for. They are yours – not the bank & yours. Stress melts away. And hey, isn’t that the purpose of a boat in the first place?

It’s a simple mental shift, to enjoy the building of wealth which starts with earning, more than the finality of things that can bring into our lives.

Simple. Sure. But not easy. Marketers make sure the shift is not easy.

Earning More: Our Income

Enjoying the art of earning more starts with our income, our job.

Developing a skill to make yourself more valuable to your employer is the first step. If your skills help increase the bottom line, then you are in a position to ask for more of that bottom line. A raise. A bonus tied to performance.

This can be simple. Meet with your boss and tell him or her that you want to earn more, but you recognize that earning more is only justified if you contribute more to the bottom line. Make suggestions on how you have done that and can do so, and ask for input.

Then meet again every month for 3 or 4 months. Set these meetings ahead of time.

Document, briefly and succinctly, how you are meeting the goals you and your boss agreed to, together.

Then, ask for a raise, based on that performance. It should come easily at that point, as you are both bought in.

Finally, get the raise and celebrate. Splurge. Go to dinner or take a vacation…with a small part of the money. You deserve it.

 With the bulk of the newfound income, save/invest the new amount. It will allow you to grow wealth over time. Don’t immediately let lifestyle creep eat it away. Celebrate. Then let that newfound income work for you; don’t you work for it.

Earning More: The Side Hustle

Part of changing our participation in the American culture is a shift from getting more stuff to pursuing more income.

We have to like the game of making money more than the game of instant gratification with stuff.

We have to enjoy the pursuit of income before the satisfaction of shiny new stuff so that future purchases are not constantly being brought forward in time, via compounding debt.

And the shift requires filling our mental set with something other than the marketers have been filling it with. That’s where a side-hustle comes in. Not just to bring in more income, but to replace the marketers’ grip on us with something else, something new.

And a side hustle always requires a stretch, either to new skill sets, or to develop existing skill sets to new capacities.

One couple we are friends with is a cop and a school counselor, respectively. They are both good at what they do and enjoy their jobs, but also share a passion for scuba diving.

Between travel and equipment, scuba is not an inexpensive pastime. So they started a side hustle, an online scuba retailer. They scouted out wholesale providers and set up the online store. Marketing the store came fairly naturally to them. They were both involved in online scuba communities, and a few books and Youtube videos on marketing got them going.

Their problem, they found, was bookkeeping.

They started on a yellow legal pad, just making note of each sale.

That didn’t work for long. So, that was their stretch, to learn bookkeeping. They found that neither of them liked that aspect of the business and that it was pretty inexpensive to hire a professional.

Everyone who starts a side hustle runs into the ‘thing’ that they don’t know and holds them back. That is an area of growth both professionally and in business.

You will find the same. Growth, and passion. Oh, and added income to then save, invest and grow.

The 30 Day Challenge is one of the best ways to start and profit from your side hustle, in just 30 days. Let me know your results if you jump in.

We cannot change America and the debt trajectory that we are on as a Country. And we cannot turn back the clock to 50 or 60 years ago where Ozzie and Harriet could live on one income, be happy, and achieve the American dream.

But we can adapt and change ourselves to prosper in our America. And that change will prompt us to grow, and ultimately begin to transform the culture itself.

About The Author

For years, 18 as of this writing, I have walked beside average men and women of all ages on a specific journey. The journey of home ownership.
And what I have discovered in opening up the financial reality of thousands of individuals & couples is a constant mix if fear, hope, confusion and achievement. It really is an exhilarating journey!
And I have read innumerable books on personal finance, read the blogs and listened to the podcasts, and spoken to the experts. And there always seems to be a bit of a disconnect between the theory of ‘personal finance’ and the lived reality of what is, truly, personal finance.

This is a place where real life meets real money. I hope you will come along on the journey to explore Finance, on the Front Line.


Recent Post

Photo by on Unsplash Most people use

Read More

How Many Homes Should I See? Buying a

Read More

9 Small Business Success Stories Every now and

Read More

Email Newsletter

Loved this? Spread the word