Yesterday I walked into a mountain mansion up in Park City, Utah and I was instantly jealous of the excess on display.
My eyes were immediately drawn from entering the massive wood doorway straight back to the large windows displaying a beautiful mountain side fill with pine trees and a beautiful sunset sky.
I thought, “Wow, I could really get used to this.”
Mansion in the Mountains
The decor of the house was fancier than I personally like but the wood beams were dark, rich, and booming high above head. The floors were a mix of wood and marble. The monster fireplace went over 30 feet from floor to ceiling with beautiful river rocks covering the outside. The opening to the fireplace was large enough for me to walk in to and the mantle was large enough for generations of family pictures and of course a TV more than 80″ big (that somehow still looked tiny in this house.)
This mansion was gorgeous and in one of the most beautiful areas of the country and I wanted it so bad. I was amazed at how elaborate homes can be. How do people even think to do some of the designs and features they have in their house? But I knew ahead of time entering this house the grass isn’t always greener on the other side.
Broke Millionaire
After my daydreams of a house, I will never own faded away, I quickly met the owner who joined us in the side office. The current owner was older lady who looked worn out and tired. She knew the coming conversation would not be pleasant. She had this amazing luxury to enjoy 24/7 and yet she was one of the most unhappy people I had met in a long time.
Sometimes I wonder how rich people can be unhappy.
They have all the money in the world. They can buy anything they want. They don’t have to work. They never have to worry about anything.
Well that of course isn’t true. Most people have the same problems as everyone else, they just have more money than we do and sometimes that is the problem. If we can get in trouble with making $30,000 a year, then someone making 100 times more than us can absolutely do the same. They just have more zeros than we do.
This wealthy lady who was living a high and mighty life in the millionaire club told us about how after decades of success, due to now deceased husband owning several businesses, is now crashing down. Instead of having $300,000 coming in a month it has slowed to a trickle of “just” $100,000 a month. She is on the verge of being completely broke (her term) and losing this beautiful house and everything else because of obligations to the business and creditors. She is stuck in a life of debt.
Still a Millionaire but Broke
The person I was visiting with has been working with this “broke” millionaire for a while. He has been encouraging her to know that they are still pulling in over $1.2 million a year, but they will have to dramatically change their spending. The lists of assets and obligations was so mindbogglingly long that I would be in a bad mood as well to see page and page of asset being crossed out.
They have been working at eliminating obligations and have been able to get their monthly expenses down to $250,000 a month, but that is still a long way off. They were bringing in $300,000 a month at the high time and spending that much and sometimes more each month. It would be impossible to meet the current income without losing some of the houses (multiple), cars, boats and selling off one of the businesses.
It’s What You Spend Not What You Make
I’ve said it before but many times but often we think that if we just earn more money that all our problems will go away. We’ll it’s simply not true. If you can control your spending then no matter what your salary is, you are set.
What good does it do to earn more than a million dollars if you are living like a multi-millionaire. If you can control your wants over your needs, then life can become simplified. It’s often hard to maintain the same income over a long period of time. Sometimes there will be fluctuations and we should plan for those, but when life gets good, we often think it will last forever and increase our spending to match or exceed earnings. That is why so many extremely wealthy people file for bankruptcy.
Should I Feel Sorry for Broke Millionaires
I’ll be honest at first, I felt disgusted at how someone who had so much could feel broke. How could she ever understand how hard it is for us regular folks just trying to live day to day.
However, I thought it’s probably the same way some folks feel about me. There are many different levels of income and we’re often jealous of anyone that has anything we perceive to be better than what we have. It was hard to feel sympathetic, but for a moment I couldn’t believe that my financial situation was in better shape than someone with millions.
I wanted to take picture after picture of the house to post to the blog, but you shouldn’t kick people while they are down. I believe most of us on writing finance blogs are trying to help each other out with tips and encouragement and shouldn’t crush people in their time of need even if they put themselves in that poor finance situation.
People always make poor judgments, what really matters is what you do after the mistake. Are you going to pick yourself up and move on and learn from the experience? Or are you going to wallow in self-despair and let one bad decision determine the rest of your life and destiny?
You Always Have to Budget No Matter What Your Income
This really goes to show that no matter how much you earn you have to control your spending. If your earnings decrease, then you should decrease your spending. If your earnings increase…. well, I think you should still live like you make less and invest the difference just in case tough times come along and also to build up your future wealth. Your income needs to outpace your spending, even on the salary increases.
If you make $10,000 a year and spend $15,000 you will be in trouble.
If you make $1,000,000 a year and spend $2,000,000 a year, then you will be in trouble.
It’s not what you make, it is what you spend. If you want to be wealthy (in-charge of money and not money in-charge of you) you will always have to spend less than you make and start saving and investing. It is that simple. A wealthy person is someone out of debt and saving and investing…. doesn’t matter the amount.
Oh man, was that a nice house. Who knew so much misery could take place behind such an amazing mansion.
