Community Manager
Community Manager
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USAA Community Forget the Joneses.jpg

Fighting the urge to keep up with the Joneses is a never-ending battle. My thought and theme for 2018…forget the Joneses. I know it can be hard to do. Heck, we recently moved into a new home and I – even though I know better – find myself walking through other peoples’ houses and houses under construction thinking about what we woulda, coulda, shoulda – and still could do, if we get caught up in the Jones race.

 

However, if you look around, you’ll quickly recognize that the Joneses are setting a financial example extraordinaire; an example of what not to do. Let’s examine some of their fantastic – dripping sarcasm -- work on the financial front:

 

They are powering economic growth. With roughly 2/3 of our economy powered by the American consumer, the economy is in good hands. Earlier this year personal savings hit a 10-year low of 2.4%. That’s plain pitiful. If you’re in your early 20’s and just getting started, you can probably get away with saving 10% for retirement, but most people have a variety of goals that will require even more saving. So, the Joneses and their 2.4% savings rate is a joke.

 

They’re playing the “how much payment can you afford” game with the car dealer. Ever wonder how the Jones family affords that never-ending carousel of slick new vehicles? Maybe they can’t. Instead, much to the appreciation of their car salesman, they are stretching out car loans to the point where the payment is “affordable.” Every quarter, Experian produces a “State of the Automotive Finance Market” report. The latest indicated the average new car loan was over 69 months. You know how averages work and that means there are a whole bunch of loans out there with terms longer than 69 months. Shoot for an un-Jones like approach, something that’s affordable with a loan of no longer than 5 years.

 

They can’t be bothered with life insurance. The Jones family apparently doesn’t need any stinking life insurance. Three kids, a big mortgage, a couple car loans and a lot of underfunded financial goals wouldn’t even phase the survivor if the unthinkable happens. That probably sounds ridiculous, but according to LIMRA, there is nearly $2 trillion in unfunded life insurance needs out there. The Joneses are clearly skimping, you shouldn’t. Check out the life insurance calculator at usaa.com/life and see where you stand.

 

They’ve got plastic in hand for the next emergency. In January, the Bankrate Financial Security Index reported that 61% of Americans surveyed would be unable to draw from savings to respond to a $1,000 unexpected expense. They’d be forced to borrow from family, sell stuff or break out the good old credit card. Another not-so-enviable trait of the Jones crew, but a boon for credit card companies.

 

So, in a nutshell here’s a short, sweet (bitter) and I hope compelling case against trying to keep up with the Joneses: They are going backwards.

 

Have you made a Jones-like mistake in the past? Share how you recovered!

 

Disclosure: "Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and CERTIFIED FINANCIAL PLANNER™ in the United States, which it awards to individuals who successfully complete the CFP Board’s initial and ongoing certification requirements."

 

The information contained is provided for informational purposes only and is not intended to substitute for obtaining professional financial advice. Please thoroughly research and seek professional advice before acting on any information you may have found in this article. This article in no way attempts to provide financial advice that relates to all personal circumstances.

 

No Department of Defense or government agency endorsement.

 

The trademarks, logos and names of other companies, products and services are the property of their respective owners.

 

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2 Comments
Aslan1
New Member

Between my wife and myself, we had 33 credit cards. We resolved to fix this credit mania. Within a year or so we had it down to one credit card, and we kept it for two reasons, one, the ease of transacting business without the need to carry large amounts of cash, and two, the benefit of accruing frequent flyer miles, which I must say has saved us thousands over the years. We purposed to pay off the lone credit card at the end of each month so as to avoid any interest costs, and for the most part have lived up to that resolve. We are now getting ready to pay off our one remaining debt this yesterday, our mortgage, and will then be totally debt-free. My wife lives her job so decided to keep working, while I have been retired for 15 years and am loving it.

Community Manager
Community Manager

Congrats! That's a great story and a great example of a "Jones" people should remember and emulate!! -JJ