Don’t Be Perpetually Broke

Don’t Be Perpetually Broke
March 1, 2013 by

Everyone has a friend that is perpetually broke. I know at least a few people who can never seem to afford to do anything with me. It is important to use your money wisely and keep to a budget, but don’t let money get in the way of relationships with your friends and family.

Don’t Be Stingy

I’m not just talking about adventures to Las Vegas and expensive concerts, I am talking about things as cheap as a $7 ticket to the Rocky Horror Picture Show or a $5 cover for a show.

Don’t get me wrong. I respect people making smart decisions with their money, but draw the line somewhere. For a once in a long time experience that costs less than $10, telling your friends that you can’t afford it will not usually get the best response.

Rather than believe you, they will think one of the following things:

  • There is no way you are that broke.
  • They just don’t want to come with and are lying to me.
  • I’m not going to bother inviting them next time.

I don’t think you want your friends saying any of those things about you. Here are some ideas to avoid the fate that some of my friends found: me not calling them anymore.

Say Yes Sometimes

You are not going to want to do everything your friends do. That is a given. But do some of the things your friends want to do even if it is not your first choice.

I promise that almost everyone reading this blog can come up with $7 for a fun night out with friends. Given that the minimum wage is $7.25 and you likely make at least 1.5-2x that, you can probably afford to devote 1 hour of work to 2-4 hours of fun.

Budget for Entertainment

Do you really have so little money that you can’t afford a $7 night out? If that is the case, as my friends claimed, it is time to think about how you budget.

I am by no means advocating people spend money they can’t afford. I am also not telling you where to spend your money. If you don’t want to go to a $7 movie and would rather send your money elsewhere, be honest about it. Don’t blame the extravagant cost.

If going to shows is a priority, look at where your money is going and budget for the money to go where you get value. I use Personal Capital every day to help me manage my money. It is 100% free. As an alternative, I also recommend Power Wallet.

Be Careful With Impressions

I have had friends tell me they can’t afford a $5 cover, but they could easily afford a $8 drink down the street. They could obviously afford the $5 without any problem, but it was not a priority.

This comes back to the comment on lying above. Give your friends a totally honest answer. It is okay to not want to do some things. It is okay to tell them that you would rather spend your money elsewhere, but don’t say you can’t afford something unless you really can’t afford it.

How Do You Deal with Friends and Money

How do you deal with friends and money? How do you explain budget priorities to people that don’t budget, or people that judge your situation? Please share in the comments.

Image by Tax Credits / flickr

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Eric

President and CEO at Narrow Bridge Media
Eric is the founder and editor of Narrow Bridge Finance. He is a financial analyst with an MBA and undergraduate degree in finance.
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  • http://myathleticlife.com/ Tim Huntley

    I believe it is OK to have different priorities about money and where to spend it, but your point, as I understand it, is to not be cheap, and be honest about your motivations. I agree 100%. I would say that if you have “friends” that too often judge your situation or priorities, maybe it is time for new friends.

    • http://www.narrowbridge.net Eric

      I think that if you are honest about your priorities, true friends would not judge your spending habits. A good friend should not just your spending habits at all unless they are trying to help you out of a bad situation.

  • http://www.myfijourney.com/ My FI Journey

    I struggle a lot with whether I’m too cheap. For example, I have no problem spending money on costly dinners if my friends want to go out. But what happens when they go out all the time? I want to save money, but I also don’t want to be a shut in. The best answer that I came up with was to start ordering less. Maybe skip the drink or the dessert. After all, if it’s a frequent occurrence then there’s no reason to go all out with spending.

    • http://www.narrowbridge.net Eric

      My thought is that it is okay to skip going sometimes if you don’t enjoy going, but if you constantly tell your friends that you “can’t afford it” when you clearly can, you should adjust either how you look at spending on social events or be more honest about your priorities.

  • http://twitter.com/ellstar Danielle

    I like the distinction between paying the cover and for the drink. Personally I dislike it when somebody is always crying broke but you know it’s not the full story. I’m willing to work together with friends to make sure when we go out that we go somewhere we all will enjoy/have a good time. If the cover is bothering you, let’s be honest from the outset.

    • http://www.narrowbridge.net Eric

      Exactly! We are each allowed to have our own goals, priorities, and motivations, but pointing the blame at money when that is clearly not the case is bad karma.

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