The economy is coming back to life, and lingering memories of that last recent economic downturn are impacting people’s approach to money management in a positive way.
Now, as the nation recovers, will we all remember the lesson?
There is a new trend toward voluntary simplicity, which means to live with less stuff, by choice –
to be free of debt and free of clutter.
When I was a teenager in the 1960s, I remember my father telling me that he made two mortgage payments every month. I also remember our going without things we wanted, in favor of getting the mortgage paid as soon as possible. I didn’t fully understand his thinking, but I sure do now.
voluntary simplicity means living with less stuff, by choice –
to be free of debt and free of clutter
Voluntary Simplicity: a Life Free of Debt
I had left home before the mortgage was paid in full, and I’m nearly certain my father did not have a mortgage-burning ceremony after the last payment was made, but there was a time when paying off the last payment of a mortgage was a cause for wide celebration, often marked by an actual party where the document was torched.
“…the ceremony had shifted from a celebration of the alleviation of debt,
to a celebration on the occasion of new debt having been obtained”
Back in 2007, Washington Mutual sponsored a promotion in Los Angeles, giving away $2,500 — the first month’s payment — to the first fifty applicants who qualified for their new loan product, combining a first mortgage with a home-equity line of credit.
In an interesting moment that I believe speaks to a cultural shift (one that has not served us well), Washington Mutual sponsored a ceremony in which the first mortgage payment coupon was set fire. The ceremony had shifted from a celebration of the alleviation of debt to a celebration on the occasion of new debt having been obtained. And, the mortgage product which was the subject of the gaiety was one in which homeowners were highly leveraged, often beyond their means (it is perhaps not surprising, then, that about a year later, Washington Mutual’s closure was the largest bank failure in the history of the United States).
Though some debt is smart debt, and home ownership often falls into the category of smart debt — it depends on the unique circumstance. The larger point here is, it’s prudent to be aware about how you might be being influenced by your current culture’s perception of debt as you go about making important financial decisions for yourself or your family.
How Our Culture Perceives Debt
As is most always the case when balance is sacrificed, the pendulum is swinging back in the direction of moderation.
People now seem less interested in the excess that brought our financial system to its knees and more interested in living within their means in more manageable and predictable ways.
Some have experienced loss from their excesses, while others are choosing to “downsize” in an effort to make their lives and obligations more in keeping with their actual needs.
There will likely be more interesting insights as we continue to make sense of those cultural shifts that are occurring as a result of our experiences during those fiscally turbulent times. What will we have learned?
I enjoy hearing your thoughts, ideas, opinions and questions!
David Findley is a Certified International Property Specialist who focuses on Southern California Estate and Lifestyle Properties. David can be reached at 310-345-6911.
My new favorite symbol. I have a closet full of things that I am just hanging on to. Less does equal more and with that comes less debt, more liquid cash, less stress and more happiness from enjoying life!
My parents were children in the Depression ( I know – I’m older than you are). They saw so much pain, abandonment, and hunger, that it never left them. In the late 70′s I was given gold beads for my necklace, and the words my mother said then have boomeranged in my memories:
“You may have to buy food with that gold one day.”
Now I stare at odd broken bits of gold jewelry and wonder if they’ll cover my son’s next college tuition payment.
We’ve always lived simply and within our means, but every month the gasoline bill grows, the kids grow, and somebody needs money for a football game or a burger. It’s getting harder and harder to find the ‘disposable’ income we used to eat out and vacation with.
When I first got decided to work in media I was told to save a 1/3 of my wage because work is usually short term and sporadic. I’ve always been a fan of living in my means and this saving mentality has allowed me to buy cars and holidays without the need of a loan.
Since 2008, I’ve been reawakened to the possibilities of simplicity. I’ve been more successful at keeping clutter out of my home.
{ twitter = @danenow }
I read recently an article by Dr. Brian Swimme, which noted one of the clinches for how to construct an ad dictates that “an ad’s job is to make them unhappy with what they have.”
The same article discussed the challenge and importance of controlling the hold advertising can have on our children as it introduces them to potentially 30,000 advertisements before they enter the first grade. Certainly worthy of our serious consideration. The entire article is available at: http://www.newdream.org/newsletter/swimme.php