This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
Think of purchases in terms of the return on investing that dollar amount
Looking wealthy but not having any money in your bank account or
Being wealthy and having money in your bank account?
It’s a question worth asking because many choose to look wealthy instead of actually being wealthy.
As a kid, I remember how easy it was to be impressed by what people drove, the cars they lived in, or the clothes they wore. That “awe” quickly vanished after I started learning that these same people were financially struggling or going bankrupt.
Social Status has become more important than financial freedom.
People willingly choose to manage debt rather than invest.
Most people leave this earth owing debt.
Why is this?
Well, it’s easy to. We’re constantly being bombarded with marketing materials that promote language such as:
No money down
0 interest payment for x month
Low interest rates
You’re qualified
You’re pre-qualified
And the list goes on and on.
But are you qualified?
Should you add more liabilities (debt) to your current expense load?
Whether you have a lot of cash flow coming in or a little, maintaining low liabilities is critical if you ever desire to build wealth. If you’re constantly spending and investing in your social status (aka appearance), you will quickly run through your cash – as we witness many athletes do with their millions of dollars.
Why Do We Value What Others Think?
This is a question I still wonder about. As a young person, I wasn’t ashamed to underdress at events or wear the same pair of sweats, jeans, and shirts for years.
I probably could have used some upgrades in my wardrobe, but I appreciate how this habit developed so early. I’m still the same way today.
Someone asked me years ago, “Are those the only jeans you have?”
Truthfully, they were, and I was okay with it. I didn’t shop to buy more jeans because my ego was hurt or they recommended I upgrade my wardrobe.
There Is More To Life Than Social Status
If you learn this one truth early enough, you will save yourself thousands and potentially millions over your lifetime.
I love Warren Buffett’s logic on purchasing things. If he bought a $20,000 car, it would lose its value. But if he invested $20,000 over decades, it could become millions.
Should you invest in the car or the money into income-producing assets?
To each their own.
But if we compare the investment opportunity to the current value of our purchases, we may cease our frivolous spending habits.
At the end of the day, you should care less about what your friends think and more about how much financial freedom you have.
Driving a nice car, wearing name-brand clothes, traveling luxurious, and living the “lifestyle” and showing others you can live this lifestyle are cool if you can afford it, but if you can’t, what are you doing?
And what does this say about your character?
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.