Keeping up with the Jones's, why it means budget failure
If you have children or if you remember what it was like to be a child, you know how important it was to feel like you fit in. You wanted to be liked and accepted. As children we wanted to dress like the other kids, buy the same brands as the other kids and be interested in the things that were popular at the time. If you have children of your own who are facing these pressures you may have counseled them to not compare themselves to others or to be special in their own way and to not want to be like some one else.
Such childish notions have not died with our youth. As adults many of us are still comparing ourselves to others. If we were to take our own advice and focus on our own needs and situation there would be no need to "keep up with the Jones's" as the popular phrase illustrates. Yet, we do somehow forget all logical advice and sacrifice our own financial well being in order to keep up an image. We forget or simply choose not to acknowledge that keeping up with the Jones's means budget failure.
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When we first set out to copy or out-do someone else, we are guilty of a huge misjudgment. That misjudgment is lack of information. Often times what we see in our neighbors is just the tip of the iceberg. We see the perfect family with the perfect house in the perfect setting. But in all reality there is always more to the situation than the Jones's family will ever let you see. The Jones's may be skilled at parking their expensive car where you can see it or dressing in the fanciest clothes whenever they go out. What you will never see is that the Jones's may be in debt too. Who's to say that all those fancy things that you see others with did not come at a cost? Almost anyone can get a credit card; in fact almost anyone can get multiple credit cards with high limits. Buying things is not difficult. Paying for those things in full and having smart money management skills is very difficult. What you see on the other side of the fence and in your neighbor's yard is not the whole story.
So maybe the Jones's don't have abnormally high debt? They might have connections that you don't. For example, having a good friend or relative who is a contractor or a car dealer can save you a lot of money on the big and impressive publicly displayed possessions that you may have. Or, the Jones's could be excellent money managers who have spent a great deal of time saving and investing wisely. In trying to keep up with them by living outside of your means and by completely ignoring your budget, you are in fact making it harder and harder to match their success.
If you really look at it keeping up with the Jones's means budget failure because you are comparing apples to oranges. You cannot expect to be able to match all of your expenditures to someone else when you have different sources of income, different financial obligations, different debts, etc. It is illogical and self defeating. You cannot budget money that you do not have.
Instead you should be striving to set personal goals not competitive goals. Evaluate what you have and what you want. Then determine how much more you will have to do or how much harder you will have to work in order to attain that goal. You will never find a one-size-fits-all budget because there is not such thing. Unique situations, skills and desires set each one of us apart from our neighbors. You cannot use your neighbor's money as a foundation for your own budgeting technique.
