With all that has been going on these last couple of years with our economic times, I feel the call to write about the problem in a clear and concise manner. You won't hear any thing about derivative securities or sub prime mortgages or [insert industry here -- banking, auto, etc] bail out. Let me be as clear as possible and bring it back to 5th grade math.
Do not spend more than you make.
What you do not spend, save.
My kindergartener had a hard lesson yesterday at the the elementary school book fair. Her mom and I gave her $5 to spend and she could add however much she wanted from her spending money. The total was $7.76. Now most books at the fair were about $4 and she had her eye on 2 particular books. (Here is your 5th grade math lesson - 2 books at $4 each is $8 total. $8 is more than $7.76.) During the deliberations mom and I discussed whether or not to give her some extra change to cover both. The decision was to let her make the hard choice. Now before you say that we are cruel to not give her what she wanted, think about what she learned yesterday.
You can't spend more than you have.
A hard lesson, but one we should all relearn.