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[The following is a partial transcript of this episode of The Scott Alan Turner Show. Listen to the full episode to hear this story, listener questions, money hacks, and inspiring stories of people that are changing their financial lives. Subscribe to the free podcast on iTunes or Google Play]
Yay!!! Spending! But not just any spending. You should be a big spender. Think about that.
One of the reasons to save now is so you can spend later. But here’s what most people don’t realize. It’s NOT a dollar for dollar.
The $10 lunch, isn’t $10.
It’s $13. Because a person has to earn $13, pay taxes, just to get the $10.
There is the also opportunity cost. What else could the $10 buy instead of lunch?
- Two boxes of girl scout cookies. Yumo!
- A new cookbook, which could result in 241 different ways to cook a piece of chicken for lunch
- A matinee movie ticket, for a couple hours of entertainment rather than a lame sandwich that will be eaten in 15 minutes
But the most important thing about the $10 is what it could have become.
It’s kinda like that saying about ‘here’s an oak tree, because somebody planted an acorn 20 years ago.’ And we can’t go back in time by warping around the sun like in Star Trek, so the next best option is to plant an acorn today and watch it grow for 20 years.
In my book 99 Minute Millionaire I gave two simple examples of simple saving.
- A $13 pizza every week comes out to $64,000 after 25 years.
- And a $31,000 new car would grow to $1.4M if it had been invested forty years instead.
You want to be a millionaire? If you’re a bit like me, your million dollars is sitting out their in the driveway rusting away.
An easy way to become a millionaire is to save and invest a car payment instead of borrowing and spending a car payment.
You will earn a million dollars during your life. What will you choose to do with it.
Money when saved and invested simply, easily, and left alone, doubles about very 8–9 years on average.
But people think, so what, I’ve gotta wait 8 years and I’ll get a lousy $20 instead of $10? Big whoop! Let me order a Subway sandwich and some Doritos.
That’s short term thinking without knowing how your money will multiply and grow over time to make you crazy amounts of money.
The key is ‘over time’ and seeing the bigger picture. That’s why I’m your guide. I’m your guy, and your guide.
It’s not $10 one time. It’s $10 a week, over a period of years. Maybe that adds up $10,000.
Fast forward to the future, just five years from now. Do you suppose a person would look back on all the joy of those Subway sandwiches, or a fat pile of $10,000 and the joy of spending that on something super cool.
- A couple weeks in Europe at some four star hotels
- Front row seats and backstage passes to meet Beyonce. Metallica in my case.
- The ultimate Disney vacation where you stay in the animal kingdom and you get a real live koala bear in your room at night.
People can’t get there on credit and borrowing, because that’s not fun. That’s stress.
- And stress isn’t fun.
- The credit card bill blues aren’t fun.
- The weight of debt isn’t fun.
Spending when you can afford it, that’s fun. How much more stuff, goodies, experiences are you going to be able to have with quadruple, 10x, 20x more money than what someone is spending it on today.
If the current battle is just making it through the week, people still get to choose. The difference might be a couple nickels this week. But it might be a couple dollars next week. A couple hundred some months from now. First you gotta believe and then you gotta plan.
With a plan there is hope and where there is hope there is power and where there is power there is momentum and where there is momentum there is change.
You know that people struggle with saying ’No’ because they don’t want to disappoint other people. But it’s a lot easier to say No when you can put a big goal behind it. It’s almost like it gives you permission to say No and people suddenly understand without being disappointed:
- I’d love to but, I’m trying to save up for a house down payment
- No thanks, I’m really close to getting my car paid off
- Thank you so much asking, it’s not a good time because I’m saving for this big vacation.
- Please keep asking in the future, right now we’re saving up for the wedding and honeymoon. And most importantly, the cake.
It’s like if someone asked their friend to go out for dinner tonight, and the friend says, No, I’ve got a doctor’s physical tomorrow at 7 am and can’t eat anything. End of story.
No I can’t spend money over here, because I’ve got this other thing over here to spend it on. End of story.
Here’s what you can do: make a list in your head of things you want to buy later, so you can start changing what you spend money on today.
You’re better than your past spending habits. I’ve had that $31,000 in lost car money. Honor that lesson, move on, I know what it’s like.
Realize, Sometimes we’re not saving to save, we’re saving to spend big and have big fun.
Permission to spend big is a wonderful thing.
This video will be over in Facebook. Think about what you’re saving for. Find the video and make a note in the comments on what you’re going to buy.
How To Get Started Investing
The international bestseller by CERTIFIED FINANCIAL PLANNER™ Scott Alan Turner. Choose the right accounts & investments so your money grows for you – automatically. No jargon, confusion, or pie in the sky promises. Just a proven plan that works.