Today’s article is an observation about the credit crisis plaguing the nation, and how it might have been easily avoided. The lesson is from Chris Parnell and the wonderful folks at “Saturday Night Live,” and it’s really very simple. It goes: “Don’t buy stuff you can’t afford.” Incidentally, it also applies to the government, to corporations, Winona State University and individual students.
That’s right! The nation’s economic woes could be solved with a simple one-step process. If you don’t have any money, you shouldn’t buy anything. When prospective homeowners wanted to make the jump from an apartment into a house, the first thing that should have been asked was “Can we afford this?” I understand fully that some people have been taken advantage of by predatory lenders and con artists. But the reason con artists are successful is because they show people what people want to see. People want to believe that they can have their dream home on an adjustable-rate mortgage with that oh-so-attractive teaser rate. Governments want to believe they can spend money that doesn’t even exist, much less money that they haven’t collected.
Just like people want to believe that the nice men in the long coats at Union Station in Chicago are selling real Rolexes, which for some reason turn green after being worn for two days. A Roman from over a thousand years ago, proving that P.T. Barnum’s cynicism is not a recent innovation, said “Mundus vult decipi—et decipiatur,” or, “The world wants to be deceived—so let it.”
Students right here can be like that, too. I know personally individuals who max out the amount of student loans they can take each semester and use what’s left after paying tuition as spending money for the semester. I was only $18,000 in debt and I am graduating on time in four years, but I had accrued almost $3,000 in interest as of this winter. Student loans are a great tool, but come on. Take what you need, and “Don’t buy stuff you can’t afford.”
Credit cards likewise. Have one. But don’t use more than a third of your available credit limit at a time. Don’t spend money you don’t have. And pay it off in full every month. Does 23 percent APR mean nothing to people anymore? Might as well hand your firstborn over to your credit card company. The high credit limit you earn as a result of paying on time and being responsible is not a license to fly to Australia on your card and buy everything in sight. It’s for emergencies. Running out of beer on Friday night is not an emergency. Replacing your transmission is.
A simple and effective way to “Don’t buy stuff you can’t afford” is the envelope budget. Add up what you need to get by for each pay period, and write your budget on envelopes. Put the appropriate amount of money in each. For each category, only spend what money is in the right envelope. And don’t buy stuff you can’t afford.

Reach Sam Keane-Rudolph SKeaneRu4088@winona.edu