Why Your Finances Are Gross

It’s not surprising to anyone that Americans are TERRIBLE at managing their money. A quick look at some Staggering Financial Statistics will solidify the claim. I could list 1,000 reasons WHY everyone’s finances are “gross,” but today I’ll only present one.

Decisions, Decisions

Think about 5 biggest decisions you have made in your life. Since our minds become easily overwhelmed, I’m sure you’re struggling with this request.

Let me help…

Depending on your age, I would bet that 3 of the biggest decisions you have made may have involved:

1. Purchasing a car
2. Purchasing a house
3. Securing a job offer

Obviously, you have likely faced more monumental decisions than the above, but I would assume that most of my readers have experienced at least one or two bullet points.

Why Your Finances Are Gross

Think back to when I presented The Ideal Budget for a Single Guy. In that article you will notice that an income of $60,000 typically leaves you with $3,000/month rather than $5,000/month. A difference of $2,000 would make a BIG difference to nearly any budget.

Now revert back to the above 3 decisions…

In all 3 scenarios, we are anchored down by our GROSS income.

1. When purchasing a car, the dealership will use your GROSS income in order to determine which car you can “afford.”
2. When purchasing a home, the bank will use your GROSS income in order to determine how much house you can “afford.”
3. When securing a job offer, we become so focused on the highest figure we are offered rather than considering how much we’ll actually take home.

Thus, in 3 of THE BIGGEST DECISIONS WE MAKE, our minds are focused on an inflated figure.