Uncommon Cents

Trent over at The Simple Dollar had a great post on how personal finance is not just about dollars and cents, but about emotions. He states that it’s easy to say “spend less than you earn” but it’s a lot harder to do.

In my work as a social worker–in my life as a human being–I spend lots of time trying to help people–including myself–to behave in a certain way. It’s an incredibly difficult and frustrating task. The truth is, in many areas of life, people already know what they need to do. When I weighed 85 pounds more than I did now, I knew I needed to exercise and eat healthier. It took years before I actually did it. Many people know they need to stop smoking; it takes many, many tries before they can typically stop permanently.

It’s also not simply a matter of education; it’s not like we don’t know consequences. Ask the diabetic who doesn’t check their blood sugar what could happen in the long term and they can easily tell you about amputations, blindness, and dialysis. Ask almost anyone about the health consequences of overeating and not exercising and they can tell you almost immediately about being overweight, high cholesterol levels, high blood pressure, and more. Ask a pregnant woman who uses crystal methamphetamine what could happen to their baby and they could tell you that their baby’s life is at definite risk (if they were sober and actually cared to speak to you). Yet, diabetics don’t always check their sugars (some never do!), lots of people fail to exercise and eat more fatty or sugary food than they need to, and some pregnant women continue to use drugs.

It’s my professional experience that it’s often easier to get someone to give up an addiction to something that’s not necessary in life than to get a handle on something that must be done, but in moderation. For instance, an alcoholic can stop drinking, usually without significant negative health consequences; a smoker can stop smoking–both with great difficulty, but certainly possible. But you can’t stop eating, and you can’t stop buying stuff. So it may be more difficult to get someone perform a necessary function in moderation than to get someone to totally cease a non-essential behavior.

The eating analogy may be the most important one. The most common goal of Americans is to lose weight, and the most common goal that Americans fail to reach is losing weight. We actually know how to lose weight in vague terms: eat less (or at least differently) and exercise more. The formula is relatively simple, yet difficult to follow over the long run. Similarly, spend less than you earn is a relatively simple formula; why is it so difficult to follow? Among many examples, emotion may be an issue. Eating can be about emotion–you have a nasty day at work and eat something (maybe too much of something) that makes you feel better. Spending can be about emotion–you get caught up in wanting something out of budget and pay for it. And unlike smoking or drinking alcohol, you can’t just stop eating; nor can you stop spending.

There’s lots of theories on why people behave the way they do; there’s also lots of approaches to getting people to modify their behavior. Do these methods always work? Of course not. If they did, my job would probably be totally unnecessary. But that said, at least recognizing the issues might help. If you know you spend more when you go to a certain store, perhaps it’s time to avoid that store. If you know you spend more when surfing the Internet, by all means, limit your time on the ‘Net. See if writing down everything you spend helps curb your spending, or at least lets you identify areas where you spend more. Spend lots more while food shopping when hungry? Try a snack first. Remind yourself to wait three months before buying a big ticket item. The list is endless, but the thing to remember is this: it’s behavior, and changing behavior isn’t easy. If you’re going to make a significant change to your behavior, you need a plan and the discipline to follow it, and every little trick or hack that can help you get your spending better managed is worth investigating.

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