Look around. What do you see? I see packed buses, traffic jams, busy open houses, expensive restaurants with only 9pm seatings, and friends finding new jobs again. Double dip recession? I don’t think so. With the Dow over 10,500 and the S&P 500 over 1,020, it’s as if last year was just a bad dream.
Yet, it is exactly during good times, when we must be more diligent about our finances. It’s so easy to forget how bad things were and stray. Rather than spend more money, save more money during upswings so that we can spend more money during downturns.
When times are good, it’s not necessary to spend more money to create any sort of additional fulfillment or pleasure. We’re getting paid more, the opportunities for promotions are greater, and the demand for our services surpass our supply.
In essence, we feel good because we feel wanted again. It’s when a downturn hits when money can help balance the mood out a little with some retail or food therapy, or maybe even a vacation. In essence, spend money counter-cyclically for better returns.