164 | Buying Things You Can’t Afford

One of the biggest money mistakes lawyers make is taking on purchases they can’t afford.

Don’t fall into the trap of buying status symbols just because you’re a lawyer when your finances aren’t ready to handle them. That will only hold you back from achieving your financial goals.

In this episode, let’s talk about two examples of people buying things they can’t afford and how to know when you can afford the things you want to buy.

• • two examples of people buying luxury cars and not being prepared for the associated costs
  • the mindset that hurts a lot of lawyers when it comes to buying nice things
  • when you’re not ready to buy something new
  • the common way of looking at and spending money that keeps people from getting ahead
  • how to be strategic about new purchases
  • buying status symbols without the status
  • the downside of rushing to make a purchase your finances aren’t ready to handle

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If you’re ready to learn the mindset and strategies to master your money, learn how to work with me here.

You’re listening to Wealthyesque. We are a community of lawyers who believe that true wealth is having control of our time. I’m Rho Thomas, and as a busy wife, mom, and former Biglaw associate, I know all too well the tension between the culture of the legal profession and pretty much everything else you want to do in life. That’s why each week, I’m bringing you the information and tools you need to improve your money mindset and manage your money to create true wealth. Because ultimately, it’s not about the money. It’s about the freedom and flexibility the money affords.

Hey friend. Welcome back to the show. I hope you’re doing well having an amazing day so far. Today we are talking about buying stuff you can’t afford. I had conversations recently with two different people about luxury cars they had bought and how they were really excited about the car when they bought it, but it had become more of a burden to them. And both were talking about how they hadn’t anticipated the higher cost of maintenance and repairs. So when they had to get the maintenance done, it was much more expensive than they realized it would be and it threw them off when he doesn’t even want to drive the car anymore because she’s nervous about something else happening to it and having to incur even more costs. And they both were completely unrelated people I talked with them in completely different settings. And they’re telling me these very similar stories. So I was like, let’s talk about this because I know they’re not the only ones who are finding themselves in these kinds of situations. If it’s not clear from the conversation so far, in both instances, these individuals have bought cars that they can’t afford, even though they’re making six figures and they have their fancy law job or they got whatever promotion right they weren’t prepared for all the expenses that come along with a car like that. So they can’t afford to have a car like that yet, and I say yet because they can definitely get there as they get more control your finances and are able to handle these expenses without putting a strain on themselves financially. I think both of them fell victim to the mindset that a lot of lawyers fall into that I work hard, I deserve it and you’re looking at the numbers on paper and it’s like, oh, I can afford this. But when it’s a stretch to make the purchase when you’re just barely able to cover the cost when you can’t cover it comfortably to where it doesn’t make a significant impact on your finances. It’s not time to buy that thing yet. You don’t want to buy something you’re excited about and then be stressed about using it or worrying about how you’ll be able to juggle it with all your other bills. If you’re in that position. You can’t afford that thing yet. And I see this kind of thing happen a lot with lawyers because we’re supposed to be the ones who made it. You’ve got this prestigious position and you’re supposed to be well off and you want to look like it. But don’t try to look like your position look like you’re well off at the expense of your finances in your piece. Just because you’re in a particular position doesn’t mean you go and take on an expense that you’re not ready to handle yet. All in the name of being able to say that you have it. building wealth and actually being well off require you to make different decisions. The majority of Americans are living paycheck to paycheck including a significant number of those who are making six and multi six figures. So you don’t want to be in that position. And if you are in that position, you don’t want to stay in that position. You want to make sure that when you purchase this thing you want whether it’s the luxury car or a new house or vacation or whatever it is for you. You want to make sure you have ample room in your budget to be able to cover it so that it doesn’t become a stressor for you. The common way of looking at money is as soon as I have enough of this thing I’m gonna go buy it. You’ll never get ahead that way though. If you have just enough to purchase the thing and you’re just able to scrape by and get it you can’t afford it yet. You’re not in a strong enough financial position yet to buy that thing. Just because there’s money in your account doesn’t mean you have to spend it. Give yourself some breathing room. You don’t want the extent of your money strategy to be do I have money in my account? Yep, let me spend it, right. Instead, you want to be strategic about it. You want to plan for how you can spend this money comfortably. You want to wait to spend until you can do so without stress and strain. Otherwise, you’re always going to be stressed and you’re not going to be able to get ahead with your finances. I don’t want that for you because it’s not worth the stress, anxiety, all of that just to be able to say that you have this thing. So many people are spending money on status symbols without having the status to go with them. And what I mean by that is yes, you may have the status of lawyer, but if you don’t have the status of someone who has money, you don’t want to buy the status symbol trying to look like you have money. It’s just not worth it. Buying the status symbol when your finances aren’t ready to handle it will actually hold you back from achieving that status of being a lawyer who has money or at the very least it’ll slow you down. So I just want you to make sure that you’re thinking about the way that the purchases you make impact your ability to manage your money. They have a ripple effect on the things that you’re able to do in the future with your money. And when you try to rush it and you go and get the car or the house or the vacation or whatever other experience too soon. You do before you have your financial footing in place before you have that strong foundation set. Then it often leads to a lot of stress a lot of anxiety and an inability to really enjoy this thing that you’ve worked so hard for you end up working even harder just to keep up with having the thing. So the moral of the story is to consider how your purchases impact you financially and make sure you can actually afford the things you buy because it doesn’t feel good to buy this thing that you really want. When you’re stressed out about how you’re gonna pay for it. I want to help you manage your money better. I want to help 10,000 lawyers improve their net worth by at least $10,000 over the next few years. Taking a moment to think strategically about whether you can truly afford things you want to buy is just one step to help you get there. Come learn more tips to manage your money more strategically with less stress and more ease in my money membership group. It’s opening in September and it’s completely geared toward helping lawyers manage their money better. So join the waitlist at rho thomas.com/waitlist so you don’t miss it. All right, that is it for this week’s episode. Connect with me over on social media. You can find me on LinkedIn Rho Thomas and Instagram at I am Rho Thomas. Subscribe to the show and leave a review both of which help more people to find it. And please think of a friend or two who could use this information and share the episode with them. As we close out friend I pray that you take the information you learn here, apply it in your life and open up to the realization that wealth is available to you. As you do that consistently. Week after week. You’ll continue to take steps to regain control of your time, build wealth and live a life of freedom and choice you deserve. Talk to you later.