Why An Ostrich Could Never Be Wealthy

For the better part of my early twenties I acted like a financial ostrich.  When I began to worry about our financial future, such as how we were going to live on one income, or pay off my school debt, or pay for my kids’ college education, I simply buried my head in the sand.  After all, it was easier to do that than face the mess I had created.

ostrich060309
Photo courtesy of lorentey

But those months spent with my head in the sand now represent time wasted for putting things back on track.  The opportunities lost for compounding growth will never be recouped, no matter how much I save in my thirties and beyond.  Sure, I can make up some ground, but that $10,000 I could have easily saved in that decade would have grown to hundreds of thousands by retirement. So what’s the lesson here?

If you are young, do not ignore your financial future

I know when you are young the thought of retirement is a distant future, but there are many things that happen between graduation and retirement that you need to plan for.  Things like buying a home, a car, having children, paying for braces, paying for your children’s education, etc, all compete for your limited supply of money.  Somewhere in all that you will need to continue to save for your own retirement, so why not get a head start before all these competing priorities enter the picture.

If you have your head buried in the sand, look up before you get run over

Remember the old Road Runner cartoons when Wile E. Coyote stuck his head down the manhole cover of a busy street, just as the sound of a truck began to rumble towards him.  You knew what was coming next – WHAM! The truck hits Wile E. Coyote and sends him flying.

This is kind of like what happens to us ostriches.  We keep our heads stuck in the sand because we don’t have to hear, and see, all the noise above the surface:  The car payment we can barely make; the mortgage payment we are late on; the kids’ college fund with barely enough to pay for textbooks, much less tuition; the credit card debt that continues to climb thanks to a 28% interest rate.  If you don’t look up soon, that “truck” will smack you right in the rear and send you flying.

It’s never too late to get started

Some of you might be reading this and thinking, yeah, great advice.  Wish I had read it thirty years ago!  It’s OK.  I know it sounds cliche, but it really is never too late to get started. If you are 50 years old, have virtually nothing saved and a pile of debt, start working down that debt!  And when it’s gone, start adding more to your retirement plan at work, open a Roth IRA, and begin to take back your financial future.  It’s never too late to look up.

Comments

  1. For all those lamenting past missed opportunities, two ideas:

    a. don’t worry about things you can’t control – like the past – and do the best you can right now.
    b. send this post to your young

  2. Frugal Dad
    As always, an on-target article.

    The key is educating people from the time they are kids about financial responsibility and choices.

    Even today, when there is SOOOO much valid information available on and offline, it is still hard. Because most people either learn at home, or not at all, since schools rarely teach this, either grade, high or college. We’re talking practical stuff, as you and The Simple Dollar’s Trent explore.

    There’s a lot of need to understand the emotional underpinnings of our financial choices. You and Trent and others have done a great job.

    But if kids don’t see good modeling from friends, parents, and those they are exposed to on a regular basis (and this applies to all socioeconomic levels) AND get really good classes on this, which most don’t, most will only learn thru painful and costly trial and error.

    We need to get this info out to schools, make learning about it fun. Find multiple ways to communicate with all ages.

    And not limit the “teachers” to people like Suze Orman who had the audacity to say that teachers didn’t make enough and weren’t empowered so that they couldn’t teach finance.

    (I expected somebody like you or Trent to do an article on this. Refuting her comments. Maybe you did and I missed it.)

    Sometimes, people don’t even know they are being ostriches because they quite literally don’t know what they don’t know.

    I was raised at a time when there was no discussion of money. All you had was what you observed. And even as an adult in my 20s and 30s, there was not the kind of articles and coverage about these issues. Anywhere. (And I certainly learned nothing from my family.)

    We can’t assume that even today, with the prevalence of more info, that kids are any more interested or informed.

    We have to bring money to their level and find creative ways to expose people to financial issues and concerns.

    I remember when I was in my 20s and I told my brother: Do well in school and I’ll pay for college for you (at that point I made enough to do it).

    He laughed and said: Hey, a plumber makes X$ an hour. Who needs college?

    Well, he’s now in his 30s. Never went to college and is stuck with his work options.

    Has learned the hard way and thru his spouse how to manage money but he feels it’s too late for him to ever really do well, given his lack of experience (and opportunities).

    He is everyman for many people. It breaks my heart how different it could have been if he had been exposed to counter-influences (our parents were horrible role models about money).

    I’m still trying to encourage him to find ways to use his unique knowledge to create his own business opportunities.

    FYI: By real financial education, I don’t mean instilling a sense of entitlement in kids or unlimited opportunity “fantasies” when it comes to work/career, etc.

    We’ve had enough of that misleading garbage.

    Much is possible, but when the average “poor” kid thinks that the only way to make it is to be in TV, sports or Wall Street, that isn’t realistic.

  3. Great post. I definitely had my head in the sand for a while, and to be honest, I still fight the urge to dunk it back in.

    I find that it’s actually more comforting to face reality and know I’m doing something about it though.

  4. I want to enter my son’s name in the Home Depot gift card contest: Aaron Curry.
    He is the hardworking father of three beautiful children, Rachel, 18; Patrick, 16; and JerriAnn, 10, and husband to Tracey. He has been a scout leader for 20 years, and recently retired from the Navy. He’s active in the church, community, and neighborhood, and can be depended upon to take time to listen/help out however he can anytime he is approached. This transition to civilian life has meant a loss of access to the base/station workshops, and now he needs to stock his personal work/repair area. He would definitely appreciate a Home Depot gift certificate.

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