The 4 Worst Words for Your Financial Future

The 4 Worst Words for Your Financial FutureI’m about to share something important with you.  Four words that might be the worst in the English language and can crush your financial future.

We’re all at different points in our financial lives and we all have different goals.  However, I think it’s safe to say that we’re all here for the same reason – we want to be sure that our future is financially stable.

In my own life, I started to recognize a common theme that has bitten me quite a number of times over the years.

It’s a mindset that I have and didn’t even realize it until recently.  I also think that the majority of people tend to think the same way.

So what are the four worst words for your financial future?

I can afford it.

At this point, you might be rolling your eyes, but don’t jump ship just yet!

I know it sounds too simple to think that those words could actually be that big of a deal, but hear me out.

Whether you’re working a minimum wage job or you’re a high salary physician, the ramifications can be bad.  And over time, it can have a significant effect on your finances.

I can afford it.

I realize that these aren’t words you’re sitting there uttering out loud unless you’re one of the Kardashians or just some cocky jerk in general (we all know one of those!).  But I’d be willing to put money on it that an impulse buy has struck you at one time or another and you unconsciously thought, “Yeah, I’m good – I can afford it.”

Have you ever looked at some product or service, thought about how hard you work, and then decided to get it just because you felt you could afford it?

In some cases, that might be a pack of gum or some candy at the store.  On the other side of the spectrum, though, what about a new car, a giant house, a boat, or a fancy vacation?

Yeah, those are the moments that can get you in trouble.  No, not that pack of Juicy Fruit – I’m talking about the bigger stuff.  The purchases you let your ego make for you that have the potential to throw a wrench in the works of your financial future.


The music depot!

Looking back, I know that I’ve let pride get in the way of stashing cash.  For instance, I was a really good saver as a kid.  That’s a good trait to have as a kid, but it doesn’t matter much if you don’t hold onto that as you get older.  For me, that was in high school and college.

At the time, I was really starting to get into all kinds of music and that love continues today.  And with my first job (low paying I might add!), I started to loosen the purse strings.

So I started buying CDs from different bands I was into at the time.  Then I bought more and more and more over the years.  My collection ended up growing to almost 750 CDs!

A number of those came from joining and quitting BMG and Columbia House mail-order music clubs to take advantage of their sign-up offers and freebies.  But a lot of them were just me going into the store and buying what I liked.

So, even if we say that each CD averaged out to be $7 each (that would have been a steal!), I still would have spent $5,250 building up this collection!  To add to the pain, in today’s dollars that would be over $10,000!!!

Imagine if that money had gone straight into a Roth IRA.  At a 5% return over 25 years, that would be worth a whopping $33,864!

Now, I will say that music is extremely important to me and was a real savior to me over the years when I found myself in some dark times.  On top of that, I still listen to all my old music, so it’s not a horrible investment for over 25 years of use (and still counting!).

Nevertheless, I bet if I had known what I know now, I probably could have lived with 1/3 of that collection.  Sorry, Naughty by Nature and Megadeth – although I like you, you probably wouldn’t have made the cut!

Then there are all the concerts I attended.  I recently scanned all my ticket stubs before I pitched ’em – hey, we’re getting rid of all our crap before we move to Panama – don’t judge!  Anyway, I had 120 of them – and those were just the ones I had kept over the years.

I refuse to add up those numbers, but I’m going to guess that I would shake my head in disgust if I did.  Yes, they’re memories and yes, you need to have some fun, but there’s also a balance that needs to be had.  And getting my financial future in order first would have made a lot more sense.


Because you can or because you should…

It was just recently that I actually noticed myself thinking the “I can afford it” mantra in my head.  And to be honest, most of the time, I actually can afford it.

But that’s not the issue.   The concern is that I end up buying crap I don’t need just because my ego has convinced me that I can instead of questioning whether I should.

Although I’ve had ups and downs with money in my life, we’re in a good position now.  However, it would have been a much, much easier climb if I hadn’t bought stupid crap when I really couldn’t afford it.

I’m a frugal person now – as is my wife – and that works out well for us.  I do a pretty good job of not buying needless things for the most part, but that stupid idea of being able to afford something still sneaks into my brain periodically.


The stupid smart home

Here’s a perfect example of buying something wasteful just because my brain irrationally decided that we could.

Because we’re only taking two suitcases each with us for the move to Panama in the summer, we’re making this a Christmas more of experiences than presents.  However, that would be one sad-looking tree in the morning with nothing but letters and certificates under it on Christmas day.

My daughter wants a Google Home for Christmas.  I’m good with that – it’s not something she needs, but it should be a fun present regardless.

The 4 Worst Words for Your Financial Future - The stupid smart home
Ok, Google… tell my brain that the WEMO smart plug is not the best way to spend our money.

I decided that the Google Home Mini makes the most sense since it’s small enough to take on the move.  They normally run just shy of $50, but Target had a sale in late November where you could get two Home Minis and two WEMO Mini Smart Outlet Plugs for just over $50.

The WEMO plugs are normally about $30 each and let you plug things into them (like a lamp) so you can turn them on and off with your phone or devices like Google Home.

Do we need two Home minis?  No.  Do we need smart plugs to turn crap on and off in our apartment?  Not in the least.

Still, it’s Christmas, right?  Let’s have a little fun.  So I made the purchase and hid the items in our tiny apartment.

But then, something more fun happened.  Spotify had a promotion where you could basically sign up for their family plan as a trial and they would send you a free Google Home Mini.  Uh, yes, please.  Overall, this cost me $1.06 out the door.

And for those wondering – I will be canceling the trial, but only because of the music I mentioned earlier.  Between ripping all my CDs and the digital music I’ve purchased over the years, I have over 21,000 MP3s… more than enough music to satisfy my ears for the time being.

Anyway, I decided to return the order from Target.  But when I got to the store, I started to think, “Maybe I should consider keeping one of the WEMO plugs if it doesn’t affect my refund too much.”

Why did I think that?  Was it because we needed a WEMO plug?  Nope.  Was it because my mind tricked me into thinking, “Well, hey, it’s not that much money – you can afford it.”?  Yup, that’s exactly what happened.

And sure enough, I let Target keep $15 of my money for this device that we have no use for in our lives.  I’m sure my daughter will enjoy it for a couple days, but let’s be honest, that was a complete waste of money.

It’s not going to break us, but that’s the point.  All these little mindless purchases add up and can hurt your finances in the long run.  And we convince ourselves to buy them just because we can… bad idea.


Show a little love for your financial future!

The 4 Worst Words for Your Financial Future - Show a little love for your financial future!
Taking the time to think about whether a purchase is really necessary can save your financial future!

Realize that the “I can afford it” syndrome is not something you generally say out loud.  It’s a thought process – a little voice inside your head trying to rationalize purchases that you don’t need.

We all know that keeping up with the Joneses can eat you alive and is a death trap to avoid.  But a big part of the problem is thinking that you can afford to keep up with the Joneses in the first place (even though the Joneses likely have no money anyway).

So don’t fall prey to this trap.  Whenever you are making a purchase, take a second to actually think about that item, big or small, and ask yourself if you really need it.  There’ll be another part of your brain telling you that you can afford it, but remember that this should only be the second concern after deciding if you really need it in the first place.

Fight back the urge of making bad purchases for the sake of your financial future.


Is the “I can afford it” mentality a problem that can hurt your financial future?


Thanks for reading!!

— Jim

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12 thoughts on “The 4 Worst Words for Your Financial Future”

  1. I am great at using the “I can afford that” and Mrs. r2e always brings me back into focus by asking “But do we need it?”

    We are not big spenders to start with. Mrs. r2e choked when I bought her an engagement ring 30 years ago! While I love clicking through Amazon I am one of those types that online retailers hate – I might put it in my cart, but at the end of the day, I delete it and move on.

    1. Haha, a balance like that is surely the key to a successful, financial marriage! 😉

      I’m pretty similar with adding things to my Amazon cart and then deleting them later. It’s a great way to curb unnecessary impulse spending though – if you don’t buy it right away, that feeling of “need” for the item tends to disappear for some weird reason!

      — Jim

  2. How about early retirement? Can I say “I can afford it” to that?

    Seriously, you are so right about those little things that are so easy to spend money on. I’ve heard it said that a fair amount of purchases we make are on things that didn’t even exist a few years ago. So it’s endless.

    1. Haha, that might be the best way to look at things. If you think you can afford things you really can’t today, you’re putting yourself in a position where you likely won’t be able to even afford the necessities later in life.

      — Jim

  3. For seven years of my childhood, I had a newspaper delivery route. My parents would let me keep $10/week and the rest was invested. I’m confident I was the only fifth grader with a mutual fund. Anyway, it was wise of them and a great lesson for me. I’m sure I would have spent all my money on baseball cards or video games without their guidance.

  4. I try not to buy things because I can afford them, with admittedly mixed success. I think the occasional fast food meal gets bought because of that, but I’m trying not to let that branch out into things like new clothes, which would be very dangerous.

    I’m glad you were able to get the Home for almost-free in the end. It’s a shame your brain tricked you into keeping the plugs, but it’s not a huge deal as I’m sure you know. After all, you can afford it!

    1. It’s a tough challenge for the brain to let go of the “I can afford it” mentality, but by making it more pronounced in our lives, I’d hope that we stop wasting so much money on crap we don’t really need.

      — Jim

  5. Great post Jim! Some of the biggest financial mistakes I’ve ever made happened because I told myself “I can afford it.”

    Yes, technically I could, but they were definitely missteps.

    It’s hard to avoid these traps when we have society screaming at us to spend, but I find it most helpful to focus on our needs rather than the wants.

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