Seven Habits of Highly Unsuccessful
After working with people and money for years, this is what I've
learned: Money makes us crazy! "I have too many choices. I am inundated
with too much information. And life is moving at warp speed."
What becomes apparent are the habits od these unsuccessful spenders.
- I can do it, just watch me. We are overconfident
that we can control our spending. We think we can control our
behavior--this time. We accept the teaser credit card application
because we think we won't use it. We buy "six-months-same-as-cash"
because we know we'll have everything paid off in time. Bad
things--life--only happens to the other guy.
- I know I'm right and I can prove it. We rationalize
and confirm our spending decisions. No one likes to be wrong
and losses/failure emotionally hurt--a lot. We ask "experts"
we agree with to confirm our spending choices. We discount anyone
who disagrees with us. Over time, we can rationalize just about
any spending decision.
- I'm smart. We think the skills and abilities that
have made us successful in one area will carry over to our spending
decisions. I know a number of very smart and successful professionals
who thought they could run a restaurant. They could not--regardless
of how good their mom's pizza recipe. We tend to confuse luck
with being smart. Admit it, some of our buying choices worked
because we were at the right place at the right time. Brains
had nothing to do with it.
- This time is different. We want to believe that a
bad spending choice in the past won't happen again. It can and
it may. We aren't very good with figuring out risk and probability.
If we were everyone would own life insurance and not more than
10% of their company's stock. Remember, the group can be wrong--dot
coms, housing, and so forth.
- It's an investment. We as individuals have no control
over the market price or rate of return of anything. We can
ask a price for our Beanie Babies, gold plated coins, and collector's
edition presidential plates but the market will determine what
it is worth. Just because the guy on television says it's a
great investment does not make it so.
- I have enough time to get my spending under control.
We never have as much time as we think. Compounding is our friend--if
we use it. We seldom get a "do over" with our money.
- I don't have enough money. If we are really honest
with ourselves, we have money. We simply don't like to make
the hard choicesa bout our spending choices. Instant gratification
is great. Our feeling brain loves it. However, have to choose
between the car that cost more than my first house and being
able to retire in the future.
Ted McLyman is a fully licensed financial advisor and author.
He is a retired Lt. Col, USMC where he served in various command
and staff positions to include: economics instructor, U.S Naval
Academy; Aide to the Assistant Secretary of the Navy for Financial
Management; and served a tour in Southwest Asia during Operation
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About the ICFE:
The Institute of Consumer Financial Education (ICFE) was founded in 1982 by the late Loren Dunton (creator of the Certified Financial Planner (CFP) designation). The ICFE is dedicated to helping consumers of all ages to improve their spending, increase savings and use credit more wisely.
The ICFE is an award winning, nonprofit, consumer education organization that has helped millions of people through its education programs and Resources. It publishes the Do-It-Yourself Credit File correction Guide, which is updated annually. The ICFE has distributed over one million Credit/Debit Card Warning Labels and Credit/Debit Card Sleeves world wide.
The ICFE became an official partner with the Department of Defense/Financial Readiness Campaign in June of 2004.The ICFE was an active partner in the California Student Debt Resource Awareness Project (CASDRAP) which resulted in a new web site: (studentdebthelp.org). CASDRAP disbanded in 2010, shortly after the web site project was completed. In 2011 the ICFE assumed the single sponsorship of the (studentdebthelp.org) web site and is now responsible for its content and operation.
The ICFE is also an on-line help for consumers who spend too much. ICFE's spending help was featured in PARADE Magazine in the Intelligence Report section. The money helps and tips are from the ICFE's Money Instruction Book, our course in personal finance.
Visit the ICFE's other web sites at: www.financial-education-icfe.org and studentdebthelp.org. Both sites helps consumers and students with mending spending, learning about the proper use of credit, budget and expense guidelines, how to set up and implement a spending-plan and also how to access financial education courses and how to teach children about money. Other ICFE services include: Ask Mr. G, a free eNews, and an online resource center for students, parents and educators, plus financial education learning tools and a book store.