It’s very frustrating when people who don’t know us well attribute our decent financial situation to “luck.” As in, “You’re so lucky that you don’t have debt,” or, “You’re so lucky not to have to worry about your bills.” The conversation usually ends with the other person saying something along the lines of, “I wish I could be as lucky as you.” Of course, good manners dictate that I don’t scoff at their kindly meant words, but I want to tell them that they could be in the same situation as I am, even if they aren’t “lucky.” Because luck had nothing to do with it.
Luck is defined as success or failure apparently brought by chance rather than through one’s own actions. None of our financial success came from anything associated with luck. Everything we have accomplished has come through hard work, discipline, and patience, not some random turn of fate.
Do I believe that there is an element of “luck” involved in personal finance? Not really. Most of what happens with our finances is directly related to our actions, not luck. We make the decisions to spend or save, to wait for a purchase or to give in to the impulse to have it now. We decide whether to go to school so we can get a better job, or to remain where we are. We decide whether to buy insurance to protect our belongings or to take the risk of going without. We decide whether to keep an emergency fund in place to ward off so-called “bad luck” or to spend every cent we make now. We decide whether to save for retirement or hope that an inheritance will bail us out.
Some things may seem like luck (good or bad), but they’re really just life events that happen to everyone at some point. Some people say they have bad luck if they get ill or laid off or face some other financial difficulty. I don’t think it’s that you’re unlucky, it’s just life. Everyone has troubles, illnesses, and financial crises at some point in their lives. The downs are as much a part of life as the ups. It’s how you deal with them and prepare for them that determines your financial future. Not “luck.” Is it “good luck” if you get a major inheritance or win the lottery? Not really. You decided to buy the lottery ticket and take the risk, and someone worked very hard to be able to leave you that money. It’s not “luck” that you got that money, it’s tied to decisions made and actions taken.
The fact that we are debt free and financially comfortable is not the result of luck. We worked hard for the money we earned, sometimes working multiple jobs when necessary. We were disciplined enough to always live below our means, however small or large those means might have been. When it became apparent that further education was necessary to earn more money, we went back to school. We were patient and waited to buy things until we saved the money, rather than buying on impulse. We chose our purchases wisely, buying items that were good quality but not the most expensive thing on the market. We looked for deals and bought a lot of stuff used to save money. We saved for retirement and made sure we had an emergency fund so we could weather layoffs, illnesses and other losses. We avoided debt unless it made very good economic sense, such as to buy our home. We educated ourselves about finance and financial products so that we could make informed decisions, rather than relying on the advice of those who didn’t know us or our situations.
We’ve had our share of problems; bad luck if you want to call it that. Life hasn’t always been rosy and sweet with the money rolling in. There have been tough economic times in our household but we’ve kept to our plan, adjusted our spending and, if we haven’t been able to get ahead, at least we’ve stayed even until the bad times have passed. We’ve never had an inheritance or won the lottery. Money has never once come into our lives that we didn’t earn. We’ve worked, planned, and saved to have our current lifestyle. There wasn’t any luck involved.
When people tell me that I’m so lucky to be where I am, and that they wish they could be as lucky, I want to tell them that anyone can be in this situation without luck. It does require discipline and planning. You have to be willing to live below your means, even if that means being uncomfortable at times. You have to sacrifice some wants now in order to secure your financial future. You have to save, both for the short term and the distant future. You have to have a plan and stick to that plan, even when life gets in the way. You have to educate yourself about finances and make informed, proactive decisions. You can’t just wait around and hope that you’ll get lucky and money will fall from a tree as you pass under it. If you wait for luck to make you financially secure, you’ll never get there. Am I lucky to be debt free and financially secure? No. Am I hard working, disciplined, happy, prepared, anxiety-free, and able to enjoy life? You bet.
Image courtesy of cloud_nine