With the exception of the mortgage on our house, we live a debt-free life. I was raised to believe that if you can’t afford to buy something outright, then you can’t afford it at all. As a result, I’ve never had a car payment; I never pay interest on my credit card; and my husband and I have been socking away money for our daughter’s college education since she was a baby. We’re as fiscally responsible as they come. Why, then, you might ask, do we, and others in our situation, continue to worry about money? The answer is both simple and imponderable: healthcare.
Statistically, more people are driven to bankruptcy by medical bills than anything else. Horrific illnesses and accidents are rarely foretold, and are, therefore, difficult to plan for. That means that in order to ensure that you can weather whatever unforeseen disasters come your way, you have to plan for the worst case scenario. (If that doesn’t take the joy out of buying a new car, nothing will.)
The process of reviewing our financial portfolio starts out innocently enough. What do we envision retirement looking like? What do we need to amass money for? In our case, we expect retirement to look a lot like life looks now, without the job part. Based on that, the question is, will our investments, social security, and whatnot, be enough for us to live on after we retire, even if we retire at 65? That seems like an optimistic retirement age when you consider that, actuarially speaking, I’m expected to live until 94, and Andrew until 92. (I’m guessing that a deeper dive into my misspent youth might cause the actuaries to adjust down a bit, but we’ll worry about that another time.) Clearly, the longer we work, the brighter the financial future gets, but when dealing with imponderables, it’s best to avoid bright light.
After a thorough review of our portfolio, we’re comforted to know that we’re wealthy enough to have pizza every night for dinner if that’s what we want to do. Unless… What happens if one of us has an unexpected, uninsured illness? If we live the pizza lifestyle, over twenty years we will have spent $109,500. That would surely be enough to cover a medical expense or two. When you start looking at your spending habits in that light, it becomes clear that you’ll never have enough money.
If it’s true that we’ll never have enough money, it begs the question, why bother to worry about it at all?
So we spend $15 here, $15 there. Because, what the hell, it doesn’t matter at all, until it does. Better hold the pepperoni.