Destructive Money Behaviours

When I was learning to drive a car one lesson that stuck in my mind was the idea that the faster I drove the faster I’d have to think. Since I don’t like having to make quick decisions that could endanger my life I slowed down.

Drive like lightning. Crash like thunder.

Quick Action, Bad Decision

Anytime we have the ability to act quickly it often leads to bad outcomes. Slow decisions allow us to consider consequences; instantaneous decisions force us to face consequences. This idea has never been truer than when it comes to spending money.

When we use cash to purchase items, we tend to be a little more cautious with our spending. There is a process to completing a cash transaction and it takes time. It forces us to look at those paper bills and really think about how much we’re spending. Study after study proves that cash spending is consistently less that credit spending.

Instant Spending

Let’s fast forward to the current situation where we spend money instantaneously and it is far far far too convenient. With the ability to purchase items online it’s temptingly simple to get whatever we want, and fast. That speedy process tends to cloud our judgement and has definitely led to a crisis in financially destructive behaviours.

So if you don’t feel like cooking tonight (who does after a long day at work) simply order, pay online and have the food dropped off at your door.

Even the very simple process of using a debit card was streamlined to allow faster transactions. Who’s got time to put the card in the machine, select the account, and enter the PIN when we can simply tap and we’re done. Even scarier is the idea of using artificial intelligence (siri or alexa) to complete online transactions literally by voice command.

Dangerous Trend

The latest trend I’m seeing is very dangerous. There’s been an advertising storm of online betting sites allowing you a multitude of ways to bet on sporting events. Naturally the wagers are conveniently connected to your banking information to allow seamless online purchasing. It’s easy, fast, and potentially disastrous, not to mention it encourages addictive behaviour.

Which brings us to the crux of the problem; instantaneous spending can and often does become addictive. It’s a potentially dangerous and costly habit especially when temptation and ease of use overrule willpower and determination. Never forget that every business out there has a vested interest in capturing your spending dollar. Making the spending process faster and easier is one of their greatest strategies.

In my E-books (“Water Barrel” and “The Balance”) I discuss simple methods to live sensibly for today, take charge of your financial affairs, and invest safely for the long term. For more information please visit David Penna Amazon.

As always, I am not a qualified financial advisor. I just relate financial management to my own experience which may not resemble yours at all. Advice is frequently worth exactly what you paid for it. Most of mine came from expensive experiences.