Hold up. Did we miss something? When did $50 stop being considered a lot of money?
Word on the street is $100 is the minimum for a baby shower, wedding gift, birthday money etc. As a couple who has experienced both giving and receiving recently, we find this particularly interesting. If we’re ever in a position to receive gifts, we never anticipate anything more than $50 value from any one person or couple. With that said, unless we’re feeling really generous, $50 is the typical gift cap from us. It’s small enough to not be overkill and big enough to get a pretty good gift.
Yet, on several occasions we’ve received gifts that blow our expectations away. While it should go without saying, let me be the first to say that we’re clearly appreciative and in some cases completely amazed by the generosity of our loved ones. We are truly lucky. But we’d be lying if we said we didn’t often wonder “what were they thinking?” when they spend gobs of money on us. It’s particularly confusing and conflicting when you know someone who doesn’t have much, give SO much. Declining the gift is rude, giving it away is disrespectful and accepting it can feel awkward so we’re often in this weird place between gratitude and guilt.
That’s why we stand firm in our belief that $50 is still A LOT of money. Think about all the really good stuff you can get for $50 or less. Some of our favorite things include-
- Four Roses Single Barrel – $49
- Au Bon Climat Pinot Noir – $36
- Hendricks gin $42
Noticing a theme here?
On a practical note, $50 gets you 4 months of Netflix or Hulu; a few months of a gym membership, 1 ½ tanks of gas [assuming you don’t have a guzzler] and should put a good dent in your weekly grocery bill. It also covers about half the cost of an Amazon Prime membership and gets you a few months of Apple Music. Even as a giftcard, $50 can cover two apps and a round of drinks at plenty of restaurant these days.
As an investor, $50 is also not pocket change. As of today, you can invest in several high-performing, low cost index funds such as SWTSX – Schwab Total Stock Market Index Fund which has no minimal investment amount.
This means that once you have a brokerage account, you can purchase shares as easily as you might order or re-order a pack of toilet paper so long as you have enough to cover the price and the transaction cost [est. 5 bucks or so]. Imagine how different your net worth would be if instead of making an impulse purchase in the appstore, grocery store or at the bar—you bought shares. Or if every time you came across an unexpected $50 windfall—you bought shares. Culture, social pressures and the bombardment of marketing have conditioned us to spend that $50 but if you can overcome those, you will be rewarded in the long run. THIS is what the rich do.
Today, it’s even easier to make tiny investments like this with apps such as Acorns, Betterment or other robo-advisors [more on that later]. Since we’re team Vanguard, we invest directly through them for our IRAs. For our supplemental brokerage account, [as of today] we use Ally but the approach is the same. During our monthly household investment checkup, we review Personal Capital to determine if we’re under-budget and if we don’t have a real need for that extra money—we buy shares. There’s something incredibly liberating about toasting to a glass of wine, opening an app and investing in funds in between episodes of Blackish on Hulu.
Creating and sustaining these sorts of micro-habits are just one of the big differences between those who have and those who don’t have a wealthy mindset. Those who don’t, see $50 as just that…$50. But those who do have a wealth-building mindset see $50 a month as $600 annually, as 12 shares of an index fund or as the total annual cost of an insurance premium.
We’ve found that people are often looking for tactics, instructions, apps and companies as tools to building wealth while ignoring that the bulk of the work is about softer actions like emotions and smaller habits done on a day-to-day basis. Ultimately, it’s the mindset that makes the difference.
So what ya’ll think? Is $50 A LOT of money or nah?