College tuition has an interesting history here in the U.S. Did you know that in 1880, students were typically paying $300 per year for tuition, board and lodging? Students these days are lucky if they can find an apartment for $300 a month. As of today, students pay much more for their education than young scholars in the 1880s. Where is that money going? How much are students paying for attending school in-state versus out-of-state? These questions and much more are answered in this infographic provided by Nonprofit Colleges Online.
I asked three of my fellow “Office-addicted” friends to describe Michael Scott in three words. The feedback I received included lovable, facetious, insecure (but also secure), infantile, great salesman, and the obvious – world’s best boss. But one quality that was not mentioned by any party was financially savvy. Dunder Mifflin Regional Manager, Michael Scott, continually finds himself in dire monetary straights due to his clever financial maneuvering. So I’ve gathered five examples from the life of Michael Scott to show you how not to be financially responsible.
Don’t Make a Financial Promise You Can’t Keep
For Michael, this meant promising a group of third graders, appropriately named “Scott’s Tot’s,” that he would pay for their college tuition and not being able to hold up his end of the bargain 10 years later.
Now hopefully you haven’t pledged to pay anyone’s college tuition besides your own or maybe your children’s, but even in those situations make sure you’ve adequately prepared yourself to repay those loans. As a parent, there are different types of college savings accounts that allow you to help pay for your child’s education; and it’s never too early to start saving for college. It’s perfectly fine to make large financial promises to help pay for something like an education; just make sure you’ve got a plan to fulfill that promise when the time comes.
Don’t Jump into Something Without Knowing All the Details
For Michael, this meant believing he was getting a 10-year mortgage, when in reality he was getting a 30-year mortgage with a 10-year’s fixed rate.
Hopefully you’re not as naïve as Michael and you know the basic terms of your contract, but it’s important to read through and go over every last detail before signing a contract. Credit card agreements, leases, mortgages, car loans or anything else of the sort include different clauses and obligations that are buried within the fine print. If you don’t take the time to read that fine print, you could face some unexpected consequences.
Don’t Make Impulsive Decisions
For Michael, this meant selling his condo on eBay for 80% of what he paid for it after because he believed he was a shoe-in for a promotion at the corporate headquarters. He did not get the job.
Don’t put the financial cart before the horse. You can’t assume things will always unfold the way you think they will. Be the opposite of Michael and be certain of outcomes before you indulge in your impulses and make a decision that could have a negative affect on your life, in the short term or the long term. Don’t assume that the home you’ve been eyeing will still be on the market before you sell your current home. Don’t sell your used car before the delivery of your new one. Don’t quit your current job without knowing that you have a new job in line.
Don’t Go Over Your Budget When You Don’t Need To
For Michael, this meant spending $400 on a secret santa gift for the office holiday party because he received a holiday bonus. There was $20 limit.
Of course there are times when going over your budget is acceptable. Life happens and sometimes you need to shell out a few dollars over your daily, weekly or monthly budget. But don’t be like Michael and spend money just because you have it. Save it. Invest it. Like your grandparents used to tell you when they gave you a small check for your birthday, “Don’t spend it all in one place!”
Don’t Splurge on Things No One Ever Needs
For Michael, this meant purchasing multiple magic sets and professional bass fishing equipment.
Things no one ever needs can include a wide range products and services. I mean how many tush turners do you need? And is it really that hard to not spill your coffee in your car? Now these are beyond ridiculous products, but how many pairs of shoes do you need? Is Starbucks three times a day completely necessary? Take a look back at what you spend money on every week and write it down (or just keep your receipts). Cross out things you don’t need and see how much you can save. Think of it as a game, but with real money. Your money.
So what can we learn from the financial history of Michael Scott? Be patient, try not to act on your impulses and be realistic. I know that all of you reading this blog are extremely intelligent people that wouldn’t even think about making a few of financial decisions that Michael Scott has made. But I hope that these super unrealistic television examples have at least painted a picture of what can happen if you follow in the footsteps of Mr. Scott.
Have you ever acted like Michael Scott when it comes to your finances? Share in the comments section below!