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The Big Lie

There’s a big lie at the heart of pretty much every book, article, blog post, and probably pamphlet offering personal finance advice for people my age, members of Generation Y or Millenials (does anyone remember when we got rebranded? I feel like it happened sometime in 2007, when all of a sudden dozens of articles were telling me I belonged to the Millenial generation, or writing things like, “or as they prefer to be called, millenials.”

Was there some plebiscite I slept through while I was sleeping through class in college? For my money, millenial sounds way too much like millenarian and reminds me way too much of the embarrassing Y2K party I went to when I was 15), and frankly for everyone else too, but the big lie hits people our age (my age?) worse.

It’s this: no matter your level of income, as long as you responsibly manage the money you have—never purchasing expensive electronics, saving responsibly, living the most ascetic lifestyle possible, and of course, cutting up all of your credit cards and maybe turning them into a nice mosaic to put on your wall—you can attain finance security, or financial freedom, or whatever the buzzword happens to be this week.

Come on. Do you really believe that? I’m pretty sure that earning more money is a swifter and more credible path to living comfortably. But it’s the big lie that lets people write columns about how you should always use the ATM at your bank, and never pay $2.00 to take money out of another bank’s machine because “it adds up.”

The big lie is nice because it gets people to focus on the boring minutia involved with being financially responsible, but if you’re in your 20s, buying into the big lie also does a lot of harm.

Why? Because the big lie says if you take care of the little things, if you pay your bills on time and don’t borrow money from those vicious, evil, credit card companies, you’ll be just fine. That gets less and less true as you make less and less money, and those of us in our 20s are at the bottom of the income totem pole.

If you’re concerned about money, making lots of it or just having enough of it, and you’re living on a just-out-of-college income, your focus should be on earning more. Good for you if you make what you have last longer and put some savings away, but at this age it’s your paycheck that matters, and getting a bigger one should be your top priority. You can go through all the conventional personal finance checklists and tell yourself you’re doing just fine, but if you don’t have a plan to get paid more in the future, you’re really just treading water.