Envy thy neighbor

Here's a fun article from MSN about how the wealth around you can make you feel poor. We get to hear a couple of stories, sounding very typical, of young people entering the workforce and finding themselves surrounded by rich, successful people. So what do they do? They spend themselves deep into debt to keep up.

When you hang around people who spend lots of money, you're probably going to do the same (or be miserable that you can't). Odds are also good that it will leave you broke.

it is a daily struggle to keep it from skewing her financial perspective. "I find myself looking at something and saying, 'Oh, it's only $200.' Then I look at my accounts, and I have to remind myself, 'You can't afford $200!'"

Personal finance has a lot to do with perspective. Especially for younger generations, sometimes its hard to focus on what the true value of a dollar is. We grew up with parents who spent, spent, spent. New cars, bigger houses, leveraging loans. What we didn't realize was that many of them weren't saving enough for retirement, were eating up all their equity, were deep in debt, or were just not thinking far into the future.

many of us might hesitate to admit, you strive to buy your way into the lifestyle of Mr. and Mrs. Jones, even when you can't afford it

We want to live like our parents. We want to live like our neighbors living like their parents. But sometimes we forget that as Baby Boomers they were having fewer children later in life, so their careers were already well established. By the time we were preteens our parents were in their peak earning years. That'll really distort the perspective on what's "normal" for a 20-something just out of college.

Adam once worked with a woman who had "lived the good life" but was so broke at age 46 that her parents refinanced their home to bail her out.

The lesson is to watch what you spend and happily accept a lifestyle you can afford. While your friends are all out living it up, will they be happy when they're flat broke and can't retire?