Reality Check

For today’s blog I wanted to play a game. First, imagine that you were a billionaire. What were some of the things you would do or buy? Would you still save or would you spend it on outrages things? Here are some things you could spend your money on.

1. Super Bowl Commercials. It was reported that during the 2013 game the average cost of a 30 second spot was around 4 million dollars.
2. Lamborghini Aventador. This Italian sports car will start around $387,000.
3. Private celebrity booking.  A cameo appearance at a private event will start at a couple thousand to a million depending on who you want.
4. A room at the Royal Penthouse Suite, Hotel President in Geneva. This unbelievable location will cost you $65,000 per night.
5. Harry Winston’s Ruby Slippers. These fancy shoes will cost you 3 million dollars to own.

Now, let’s pretend you’re the average American. You work, make an average living and try to balance between spending your money on fun and bills. Here are some things you could spend your money on.

1.  Check cashing and money order fees. The average cost to cash a check is around 1.75%. Let’s say it cost you $10 to cash your check and you do this twice a month. You will end up spending $240 a year on cashing your check plus around a $1 every money order you use.
2. Eating out. In 2009 it was reported the average American family spent over $2, 600 a year on eating out, be it fast food or a nice dinner.
3. CNBC reported that the average monthly payment on a car was $452 in 2012…for many people this could make up over a third of their paycheck.
4. Like shoes but can’t afford Harry Winston’s? No problem, the average person will buy a $150 pair of Jordan’s or a $230 pair of leather boots.
5. In 2009 the average American household spent over $628 in entertainment, this included concerts, movies and sporting events.

Now stop and think about the two scenarios. The first one seems outrages, how could someone ever spend $65,000 for a one night stay in a hotel? But look at the second scenario. How could someone spend $240 to cash their checks each year? For most of us, we need our money to pay bills and we also want to have nice things and do fun stuff. However, how much of your money is going to things that you would call outrageous? Maybe it’s time to give your budget a reality check!