Saturday, November 28, 2009

Quote of the Week & Commentary

"Never spend your money before you have it."

My Fellow Americans,

The quote above was spoken by the great Thomas Jefferson.  Jefferson was one of the most influential of our founding fathers.  He was also the main author of the Declaration of Independence, not to mention the 3rd president of our great country.  You can read more on Jefferson here, courtesy of Wikipedia.

Now, I realize it's a short quote.  But, sometimes it's better to just keep things simple and short.

The quote obviously refers to debt.  And I was initially looking for something by Ben Frankin (the king of frugality), but came across this Jefferson quote.  It really spoke to the message I wanted to convey to you today, so I had to go with it.

With what we saw this week with Dubai and the uncertainty in the commercial real estate market, it is so important to have our own finances in order (someone should tell that to Washington, too!).

I, like many other Black Friday shoppers, was waiting in line outside Best Buy around 5:00 am on the morning of Nov. 27.  When I was inside to purchase the 40-inch HDTV I came for, there was a young gentleman who looked to be in his mid-20's behind me in line.  We both came for the same television.  The TV was $600.  If you wanted to get it interest-free for 18 months, you had to sign up for a Best Buy credit card.  I filled out the application and was approved.

Unfortunately, for the young man behind me, he was not.  Now, I am certainly not a debt specialist here.  But, it doesn't take a genius to figure out that if you can't get approved for a Best Buy credit card, something is seriously the matter with your personal finances.  I really felt bad for the guy.  He promptly left the store of obvious embarrassment.

I tell you this not to brag, but to explain my stance.  I hate when I hear or see this kind of thing.  It's very sad. 

On the flip side, why was that kid there in the first place?  I mean, I realize he wanted the TV and didn't know for certain that he would be denied a store credit card.  But, if you end up being denied, there is obviously something very wrong.  Why are you buying a TV if you have credit card debt or student loan debt?  It's very irresponsible.

I would have loved to have sat down with the guy and talk some sense into him.  Like many Americans, he doesn't understand the burden of consumer debt.  Maybe Black Friday was a wake up call for him.  I sure hope so.  I hope this time next year he can get the TV or computer he came there for.

What I want all of you to take away from this is: get your finances in order.  We need to start taking our debt seriously.  Pay off more on your balance each month toward the principal.  Stop spending money you don't have.  If you want something like a TV, make sure you put some money aside each month to cover the payments and NEVER put yourself in the position to pay interest on a purchase like that.

My hope for these quotes of the week and my commentary on them is that you learn something.  I want us all to learn from each other here.  I have grown to love learning about finance, politics, and economics and I hope that since you're here, you love it too.

Please let me know your thoughts.

Thank you,

The Refounding Father

(Picture from

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