What does it mean to be an owner, and not a buyer? Here in the US, it seems as if the acquisition of “stuff” reins supreme. As does debt – $5,000 average credit card debt, $30,000 in car debt, $37,000 in student loans, personal loans, payday loans, and mortgages. Debt rules the day, often exceeding the value of the stuff that was purchased originally. Interest, fees, and other charges pile up, causing the cost of the stuff one bought long ago to rise exponentially.
But what if we become owners, and not buyers? It’s a mental shift, but a powerful one. Lets explore more about what it means to be a buyer, what it means to be an owner, and why one is better for your finances than the other.
Being A Buyer – Instant Gratification
We all know them – the people that love to shop. They buy, and buy, and buy. They’re keeping up with the Joneses, whether real or imagined, and are constantly “treating” themselves because they “deserve” it.
New clothes, new shoes, new cars, stuff for the kids. Bigger cars, bigger homes – because the old ones are just too small now. Amazon beckons, with Prime shipping of course, and that two year old cell phone is just too slow.
No moment of discomfort can possibly be felt by any family member. When the TV is turned on, cable TV must stream through with as fast a speed as possible. Smart phones must work everywhere, apps must be purchased, and movies downloaded. Kids must never hear the word no, and everything of course must be bought brand new.
Being a buyer means getting what you want, the minute you want it – future self be darned. So in exchange for getting whatever you want the easy way, you spend the future paying for it.
Debt is usually the name of that game. If not debt, they’re robbing their future selves of financial security in exchange for what they want today. This is how you can end up with two car loans, and other debt, unable to get the company match in your 401k (by contributing only 6% of your income!) when you make six figures. They’re living so close to the financial edge that it only takes one negative event and the whole thing comes tumbling down.
What It Means To Be An Owner
An owner doesn’t rob from the future to pay for the present. Purchases are carefully considered, and the definition of “need” is much more strict than it is for buyers. A need is a true need – an essential – something that you would not be able to survive without. Food is a need, but fancy food and dinners out are a want. Water is a need, but bottled water is a want. A car might be a need, but a fancy car, SUV, or new car is a want.
An owner recognizes that items purchased today are bought with their “life energy” – and once that dollar is gone, it is gone forever. Not only is that dollar gone, but the children and grandchildren it would have earned had it been invested are gone as well. So purchases are carefully considered, not only with what has to be given up today to buy that item, but what will be given up in the future as well.
Does this mean an owner doesn’t get the wants? Of course not. But they are carefully considered, and debt is not incurred on the way. If it is, then it’s for an asset, and likely not a depreciating one. Real estate and business investments are a yes – fancy new cars that go down in value by ten grand as soon as you drive off the lot are not.
Instead of buying a new car, that money is put into car companies. Rather than tons of new clothes, clothing companies are purchased. There aren’t necessarily shopping sprees at Walmart, but they own shares in Walmart. And smartphone companies are part of the portfolio. Especially when you own index funds, you own shares in all the top companies in the country – and the world.
So Don’t Let Your Stuff Own You
Become an owner, and not a buyer. You’ll become mentally free, financially free, and be much less burdened in general.
What are your thoughts? Do you know a lot of buyers in your own life? Are you an owner, or working towards it? Let me know in the comments!
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