Why are Some People so Terrible with Money?

"If you can't afford it, you don't buy it."

Sounds logical, right? Yet it seems quite a few people have gotten into big trouble with that concept.

Maybe because they don't have a concept of how much money is really coming and going. That is why it is important to at least have an idea of a budget. It doesn't take that much time, and there are tons of tools to make it easier. A major cause of marital strife is money, so even if you're not married, at least get some practice putting your finances in order. If you are married, I'm sure your wife will be impressed when you have a pretty looking spreadsheet for her the next time she asks where all the money is going.

Think that is too much work? Check out Mint; "Mint connects to over 5,000 US banks and credit unions, credit card, brokerage, and mutual fund companies to keep your transactions and account balances automatically up-to-date. Mint even auto-balances your checkbook and auto-categorizes your transactions. Set it up once and you’re done." Best of all, it's free!

Once you have a budget set up, you can sit down and make logical decisions about where to cut back without making much sacrifice. My favorite thing about helping people set up budgets is watching their faces when they find out how much their diet coke costs per month. One fellow I helped was spending over $2000 on diet coke per year (He drank a lot per day)

That's . . . almost the price of a car . . . every few years.

Why save money? I don't make a lot of money compared to everyone else in the area I live in, and my wife is a stay at home mom, but I still live a whole lot more comfortably then people who make more then me, because as soon as they get money they just spend it. Some people I know, after a week or so, have no idea why they don't have money and are living paycheck to paycheck, and after a while they end up maxing out a few credit cards.

Then some people even turn around and blame the credit card/lending companies. I can understand complaining about predatory lending, but it wouldn't work in the first place if people just paid back what they owed in the first place.

Don't spend more then you make. If you can't handle that, get rid of your credit cards.

Personally, I like credit cards for the convenience, and for the rewards. I put everything on my credit card that I possibly can. I get reward points that I redeem for gas cards. I pay off the balance in full every 2 weeks. It's free gas, about $1 worth for every $60 to $100 spent.

Though the MoneyAnswerGuy disagrees with me there, and says that no one can use a credit card responsibly.

Check out what different credit cards have to offer at the CreditCartGuide or CardOffers

Or you can read some other guy on the topic of "Why Are Some People so Ignorant About Money?"