money health weekly


Wasting Financial Windfalls


"Money went as quick as it came."

-Tupac "2Pac" Shakur


I'm tired as I arrive at the restaurant for work. It's 1998 and I get to work the morning shift today. This is a coveted shift. Even though we have to be at work by 7 am, we get done at 3 pm. The trade-off is worth it.

The kitchen manager, who I'll call Bobby, tells us that one of his relatives recently passed away and he inherited $100,000. This is a lot of money for restaurant workers in the Fargo, North Dakota area! I can't speak for my fellow cooks, but I'm jealous. I immediately calculated how long the money would last at my current pay rate of $20,000 per year. If I had $100,000, I could live for five years with the same amount as I make now.

Said another way, I would have blown the money. In my mind, I want to be a bum for five years. I don't really think about what happens after five years. I guess I'll have to get another job but I won't have any marketable skills. I would reward my self in the present, but at the expense of me in five years, and me in 10 years, and so on.

It turns out, putting a lot of money into my hands when I'm not prepared for it would be a bad idea. But certainly, others will do better.

Not Bobby. He had his money for a week and already spend 20% of it on a truck, wants to buy a house, and has grand plans of traveling with the rest of it.

There's something inherent about us that wants to use up all the money we have. This is the proverbial hole in the pocket. It's why our savings rates are so low. We are terrible at providing for our future selves.

Why is it that we tend to waste our windfalls?

balance present and future you