Derrick has had a stressful day at work, and when he comes home he doesn’t feel like cooking. He tells himself that he “deserves” a night out at a restaurant. This is repeated at least once a week, to a tune of $160 to $200 a month.
Victoria has $4000; instead of saving it, she remodels a part of her house. Before the remodeling is even over, she unexpectedly has a home repair of $8000. Because she has no savings, she must take out a loan from the bank. She laments that this is just the way her life is; she can never get ahead.
Billy frequents discount stores. Because he is getting items more cheaply than he would at a regular store, he tells himself it is okay to buy more. After all, he is “saving” money.
Rachael lives by herself. She thinks, what is the point of just cooking for one. She goes out to eat every night, spending over $100 a week.
What do all of these people have in common? They are all telling themselves financial lies. They have a recording in their minds’ playing over and over which causes them to make the same poor financial decisions over and over again.
In the first example, what Derrick really deserve is to save my money so that one day he can find another job that he enjoys more and is less stressful.
Victoria’s financial life is not as bleak as she imagines. She may be able to get ahead if she thought long term and saved her money instead of spending all of it whenever she gets a little extra.
Billy is getting a good deal by going to discount stores, but the good deal is lost when he spends just as much as (or more than) he would at a retail store.
Rachael could arrange a group of people that she swaps meals with; one week she cooks a meal x4 and shares with three of her friends. Three other nights of the week her friends share with her.
We all tell ourselves financial lies. We may do this unconsciously, yet they have dire effects on our financial future. What financial lies are you telling yourself?