Health & Fitness
Why People Spend their Money: Is it a Secret?
People also hold false biases and assumptions on how to invest and bet their money without doing their homework and research.
I am reading the book, The Secret Language of Money, by Dr. Dave Krueger, MD. Dr. Krueger is a practicing coach and former psychiatrist who trains and coaches people across the United States. Dr. Krueger writes the "secrets" on why people spend the way they do, according to their upbringing and false assumptions and biases they hold.
Regarding one's upbringing, Dr. Krueger writes that people spend money because it may be due to matter of having power and control and feeling secure within oneself.
For example, an individual brought up in a rich household where the parents did not provide love and affection will buy things they don't need as an adult. The act of buying is a soothing way to make them feel better and loved. As a result, this individual's home will be filled of merchandise they don't need as well as cluttering their living space. Along these lines, it boggles my mind when I hear of some low-income individuals spending their government checks to buy $20 to $50 worth of lottery tickets because it makes them feel better and in control of how they spend their money.
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People also hold false biases and assumptions on how to invest and bet their money without doing their homework and research. One example known as "Affinity Bias," is when people bet money on their alumni team to win a game because it is the right thing to do to support your college comradity.
Another example is investing in a stock due to its rise in value over the last two months and falsely thinking it will raise again the next month according to the "Rule of Threes." Dr. Krueger attributes this action due to the internal wiring of the brain to process this way.
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If people choose to spend their money as a result of their upbringing and being influenced by social psychological forces of holding false beliefs, what can be done to change the way they think. Dr. Krueger answers, "Rewriting Your Story" is the key to change the way you make choices in your life.
Other resoures are seeing a counselor; taking classes in financial management; reading additional books and material on this topic; or engaging in prayer and meditation.
For more information about Dr. Krueger, visit his website.
