In the battle to save more money and improve our financial situation, unfortunately, many of us are our own worst enemies.
The problem here is that we don’t really want to save but would much rather spend the money.
Of course, our logical side (our ‘SuperEgo if you follow Freud’), knows that saving money is the right thing to do and will try to stop us spending unnecessarily.
On the other hand, our more impulse driven side (our ‘ID’) will be telling us to buy. Spending money is fun because it tends to mean that we get new things.
Even if the thing you’re buying isn’t particularly exciting, you’ll trigger a release of dopamine in your brain when you spend the money and this teaches us to enjoy spending.
When you try and stop spending money then, you are going against your very nature and your gut impulses and that’s why it’s often so difficult.
Understanding this is the first step to turning it all around though, and the next step is to understand the ways our unconscious tries to coerce us into spending that money.
Whenever you think about whether you should buy something or not, you will trigger an ‘argument’ in your head between your logical side and your impulsive side, and during this process, you will try to ‘convince’ yourself that it’s okay to spend the money.
Following are two examples of the arguments we make to convince ourselves to spend money, and why they’re actually examples of faulty thinking.Ice cream/PHOTO: Java Cofee House
‘I deserve a treat’
This is an incredibly common one, and is based on the premise that whenever we’ve had a hard week we deserve to have something nice to cheer ourselves up.
The only catch is that we also seem to think we deserve treats when have a good week. This time, it’ a matter of making a good week better – you’re in a good mood so why not make it perfect? Either way though, you give yourself an excuse to buy and end up spending money you often don’t have.
The solution? Remind yourself that buying things aren’t the only way to treat yourself. How about you just treat yourself to a nice dinner or a nice pudding? Or by just spending some time doing something you enjoy but already have access to? You must have a DVD you haven’t watched yet…
‘It’s on offer’
While the marketing department might be responsible for this one to a degree, we aren’t completely innocent in going along with it.
Buying fast seems to make sense when we think that an item is going to get more expensive with time, but if you’re honest with yourself you probably know that a new deal is going to come along straight after.
That’s just how business works. And even if it doesn’t, the item will go down in value over time. If you really want to get a bargain, wait and get it used!
All these are examples of how we might trick ourselves into making purchases we can’t afford when really we should be saving that money or using it to pay bills.
If you really need or want that purchase this doesn’t mean you can’t go ahead with it – just that you need to manage your cash flow a little first by maybe saving up or taking out a loan.
Apply some logic when making money decisions in future to avoid falling prey to your natural biases!