Myths that Keep You Broke #21

Myth #21: Plan for Saturday Night

There is a quote that is attributed to Gloria Steinem, that goes something like this:

“The wealthy plan for generations, and the poor plan for Saturday night.” *

Unfortunately, this myth appears to be real, and not a myth. It does appear that the poor, or those with a scarcity mindset, make very short-range plans.

When I was in my 30s, I was a partner of a pension administration company that created tax qualified retirement plans for closely held businesses. There might be one or two owners, and 10, 20 or 100 or so employees.

I would hold meetings to talk about the options available to employees if the company was going to close out their tax qualified retirement plan and distribute the assets. Unfortunately the owners would transfer their money to another tax deferred retirement vehicle, like an IRA, while the employees wanted their money as soon as they could get it.

Even though this money would be taxed as income, AND include an additional 10% penalty for withdrawing the money early, they still wanted it now. They wanted to buy a new TV set, or pay off credit cards, or make a down payment on a newer car.

It was so sad for me to see 95% of the employees blowing the money that was meant for their retirement. And it was then that I realized, I was seeing the picture of how most people handle money in this country, and probably the world. They are slaves to money, and not the master of it. Instant gratification was how the majority handled money.

However, you don’t have to personally participate in this myth. You have the ability to wake up and look to your future and determine what actions will allow you to have a choice of working or not working when you are in your 50s, 60s, 70s, 80s or later.

What actions will you take to secure your financial future?

To Your Prosperity,

Rennie

* The actual quote I found is this:

“Planning ahead is a measure of class. The rich and even the middle class plan for future generations, but the poor can plan ahead only a few weeks or days.”