Spend like a 10-year-old

When I was ten years old, I was babysitting a two-year-old. Mostly I was playing with her, but it allowed her mom to get work done (that was a trusting mom!). Her mom paid me three dollars an hour. My mom made me put half of whatever I earned in the bank, and I got to spend the other half. What that meant was about once every two weeks I had $12 to spend. At the time, yo-yo’s and TY beanie babies were all the rage (I’m definitely aging myself, but can you relate?!). Most of the time I was eagerly awaiting the release of the next big TY beanie baby and my mom would take me to the toy store or flower shop to look for it. With my $12 in tow, I could usually buy just one beanie baby. I could only get one, even if Peace the Bear and Batty the Bat were there and I wanted both. My $12 wouldn’t buy two and so I would have to pick which one I wanted. When I was ten, I didn’t have access to credit and so I could only spend what I had. And, if a bigger, fancier beanie baby was coming that cost more than my $12, or if I wanted both a yo-yo and a beanie baby, I would have to save up my babysitting money until I could afford the fancier beanie baby or beanie baby and yo-yo.  

Parents often teach this lesson to their children: You can only spend what you have. Yet, somehow, when we become adults, we neglect this lesson and “treat” ourselves to most things we want. The reason this is so easy to do is because we aren’t great at looking at what’s to come when we are making decisions about what we have available to spend now. Right now it might feel like we have the money to buy a new pair of shoes, but we do that at the expense of something coming in the future that we haven’t planned for. That thing in the future must be accounted for and must go into the equation in spending what you have now. I knew, as a ten-year-old, that I had to save up if I wanted something coming at a later date and that if I spent that money in the moment, I wouldn’t have money for the thing I wanted later.  This is why budgeting with the future in mind is so important and a key principle of Bottom Line. Budgeting proactively instead of reactively. We can predict what we will spend in any given month and what we will spend month over month. This takes away the temptation to make impulse purchases and requires us to spend like we did as children – spending only what we have available and saving up for the things we really want.