Fortunately, like lemmings to the sea, there are plenty of great examples around us in our friends and neighbors as to how to model the â€œUltimate American Consumer.â€ In case it escapes you, here is a simple â€˜How Toâ€™ guide that can serve as a great roadmap to this continued process. Enjoy!
â€¢ Always spend right at the level of your after tax earnings. Having surplus dollars is troublesome for most because itâ€™s difficult to know exactly what to do with them.
â€¢ Avoid having 3, 6 or even 12 months of basic living expenses tucked into a liquid account such as a money market or CD.
â€¢ Repeatedly purchase, preferably on credit, items that rapidly depreciate such as cars and consumer goods. Why pay all cash for something when you can use other peopleâ€™s money (OPM)?
â€¢ Be sure to maintain at least $7-12,000 of revolving credit card debt and preferably â€˜store credit cardsâ€™ and be sure not to read the monthly statements.
â€¢ In the event that revolving debt gets to be somewhat of a burden, be sure to take out a home equity line of credit (HELOC) to alleviate the monthly payments
â€¢ Look for and take advantage of â€˜get rich quickâ€™ opportunities that offer simple and easy wealth accumulation plans with little effort. Leave the hard work to all the â€˜drubsâ€™ who donâ€™t know any better.
â€¢ Spend at least half of your allowable IRA contribution each year on Christmas and holidays (preferably on credit)
â€¢ If you have an investment or asset plan, be sure not to review it too often as this can be tedious, boring and rather dull. Once every 6-10 years should be fine
â€¢ If possible, avoid the toilsome task of creating asset accumulation strategies in favor of more dinners out with friends and fun vacations. After all, you only go around once
â€¢ Be sure to invest in insurance and protect yourself from disability, death, dismemberment, accident, ill health and be sure to insure your pets as well!
â€¢ Be sure only to buy new automobiles due their quality and reliability over used vehicles. Used vehicles can cost as much as $150/month in long term average maintenance.
â€¢ Avoid regular financial plan setting and goals progress
â€¢ If you have a home mortgage, be sure to refinance every couple of years to capitalize on low rates. Ideally you could own your house for 20 years and still have 20-25 years remaining on whatever debt is there at the time
â€¢ Avoid having financial coaches and truly objective advisors assisting you with your money plans
By following this plan, youâ€™ll have every opportunity to engage in being the â€œUltimate American Consumerâ€ with all of the rank privilege that is conferred by that term. If, on the other hand, you want out of this, call Eric Johnson for guidance at 941.713.9307.