Stop Saying “I Can’t Afford It”!
I am often uneasy with the phrase “I can’t afford it,” especially with my children. This phrase is used to mean so many different things. In some scenarios, it means “We literally couldn’t scrape enough money to buy that even with credit cards, payday loans, or selling plasma.” For us, we use this when the kids say something ridiculous like “I wish we lived in that mansion on the beach in Hawaii.” With our incomes, there is no possible way to make that happen. No bank would give us that loan and we do not have enough assets and investments to sell everything to make it happen. Thinking you can afford something when you can’t is also dangerous.
Other times, “We can’t afford it” means someone that has a cash-only mindset. It disregards putting the purchase on credit cards or taking out any loans (payday or otherwise). This example would be a new couch or car for someone that doesn’t have enough cash saved up to pay cash for the purchase. Then there’s the “we can’t afford it” because that money is allocated elsewhere. This is the one we’re most cautious about. By all previous definitions, we can afford it. We have enough cash to make it happen, (and can track it all with our free Personal Capital account) but we choose not to buy another car because we (already have two and three would be ridiculous) would rather save that money to retire early. For my young children, it is often unclear which definition people are using. I’ve realized that most of the time, the kids hear the very first definition: we literally don’t have enough money to make that happen no matter what we do.