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There's a guy that I work with from time to time.  We don't sit near each other or work directly together, but our paths cross every now and then.  He's a nice enough guy.  He seems good at what he does.  He's easy to work with.  Yet I can't stand being around him.


He wears too much cologne.

It literally gives me a headache to be in the same room with him for more than fifteen minutes.  There's nothing wrong with the particular cologne he wears, he just puts way, way, way too much on.

He turns something good into something bad.

I work with him so rarely that I just bite my tongue, versus making a potential enemy.

But, I realized, that this theory, applied to personal finance, is how many people make enemies of themselves.

Consider just a couple of ways:

  • Using credit cards – Credit cards can be great tools.  For those who are able, putting charges on them and paying them off can net airline, hotel, or cash rewards.  They can be a short-term method of paying for a large, unexpected bill or emergency situation.  If used properly, they're good.  But, when they're used as a method to pay for things after you run out of money, if a balance is kept and keeps growing, it can be bad.  Very bad.
  • Housing – Fifty years ago, most people didn't enter the housing market until they had 20% to pay, could afford the payments, and were willing to keep up the inside and outside of a home.  The home provided a foundation and a roof upon which to build a family. Most bought the house that they needed.  All good things.  Yet, look at the mess we got ourselves into.  People were buying (and lenders were lending) with nothing down, when payment ability was questionable, and people were buying houses that were way beyond what they needed, and that they didn't even intend to stay into for very long.  Now, the idea of housing has a very bad stigma.  We turned a good thing into bad.

These examples show that there's a fine line between something being good (a benefit) or bad (an obligation).  So much of what determines that is how we make use of the resources in question.

Just like when spraying on your cologne (or perfume) in the morning, it's true that when it comes to personal finance, a little common sense goes a long way.