Spending Money

Ramit wrote a provocative post at IwillTeachYouToBeRich about friends that seemed to be spending extravagant amounts of money. He wrote of three friends who made very good incomes and were saving what he considered to be adequate amounts of money. He basically agreed with their spending patterns and justified it based on the fact that they had a spending and savings plan. I may be wrong, but it sounded like all 3 friends were single and did not own their own homes. When you are young, single and have no immediate plans to marry, spending money extravagantly may seem like a great idea.

Then there are the comments, which range from outrage to complete agreement. The interesting aspect of the comments is the emotion that is attached to them. For nearly all people, money decisions are emotional decisions. It is tied to their self-worth in a most intricate way. How we act towards and with our money says a lot about who we are. In fact, how we manifest money may just be a reflection of how we feel about ourselves and money. Some people worry that having money will change them, when in fact it is our inner beliefs and attitudes towards money that is reflected outward by how much money we generate.

Getting back to Ramits' 3 friends, here's my thoughts. I am not opposed to spending money as I discuss in my post on Prosperity Vs Scarcity. But, I think in each of the 3 cases Ramit discusses, the friend is demonstrating a complete self-centered behavior. In my mind this is the most troubling aspect of their spending patterns. If any of them do marry, I would expect that each will spend their marriage struggling with money issues with their spouses. And if they ever deal with a true financial hardship, I would be surprised if they didn't have a huge personal crisis to go along with it. Even if you have a good financial plan, spending out of self-centered behavior does not breed a mature attitude towards money.

Now some interpretation of the comments:

• After all - we are only young once! [so lets be self-centered and spend on ourselves]
• These people are ruining the planet by spending money [I'm so holy and self-righteous]
• I agree [because I'm too undisciplined to stop spending]
• These #%&ing people all make six figures [and I'm lazy/jealous]
• I have lots of money but can't stand to spend it [I'm afraid of losing it]
• You should feel guilty about spending money [because I have none to spend and by the way how do you a make six figure income?]

None of the commenter's were at all unemotional about their money and each made an unsaid comment about who they really are. Although it may seem I am mocking these people, my intent is not to attack them, but to point out that there is underlying emotional baggage that each attaches to money.

Money is a symbol of energy and it not good nor bad, positive nor negative. It is impartial. It is only the significance that we attach to it that creates any meaning. Abundance is never a factor of how much money one has, it is a factor of how one feels about the money one has.

So before you make a savings plan, decide to spend lavishly on shoes, attack others for spending their money or blasting Walmart, it might be worthwhile to think about your attitude about money.

• What were you taught as a child about money? That it's evil or good? That corporations are greedy or that rich people are bad? We tend to carry our early life teachings through our lives without ever examining them
• Do you have fears about not having enough or having too much money? What is the basis of these fears? Is it rational or based on some underlying emotional conflict that you haven't resolved?
• Why are you spending money? Are you trying to make yourself feel better about some other part of your life that is unfulfilled?
• Can money be used for good? Is it possible that by creating wealth you will be helping others?

There are other questions you can think of as well. Try to do some reading about money. Books by Ayn Rand, Milton Friedman (Free to Chose), Adam Smith, or Joseph Schumpeter may broaden your outlook on money. My favorite book is Unlimited Wealth by Paul Zane Pilzer.

When you truly understand yourself and really understand the role of money, then you will not be caught up in mindless spending, hoarding or jealousy about money that dominates society. Money will just be a game that you play.