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Why Smart People Make Bad Spending Decisions

by J. Money on Monday, June 27, 2011

wizard dollar bill doodle
(Guest post by Ornella Grosz – who brings up a VERY good point about treating every dollar the same!  I completely SUCK at this myself, and often wonder if I’m missing on something important here, or if it actually helps me mentally?  Take a read and let us know what you think :))

Why is it that (sometimes) budgets don’t work? I think it’s because many of us set them up and never look at them again. We never evaluate them and see how we are affecting our overall financial health.  And even if we do, our life takes over and we succumb to temporary amnesia.  Without realizing it, here are a few reasons why smart people make bad spending decisions:

1. Not treating all dollars with the same value.

Here’s an example: A $100 under your mattress should constitute the same wealth as $100 in the bank, $100 of gambling winnings, or $100 tax refund.  Let’s say you and your friends take a trip to Las Vegas and decide you will not lose more than $200 on gambling.  The good thing is you are giving yourself a limit, but let’s pretend you lose $100 in the end. Now, let’s say you go home and realize your bank just charged your $100 in fees!

Here’s the question: do you feel more upset about losing $100 with gambling or $100 in bank fees?

I bet most people would be more upset with the bank charging you $100 in fees versus you losing $100 gambling.  Why?  Is it because one loss was expected over the other?  Mr. Benjamin should have the same value and significance to you.  It should be the same way if you won $100 from gambling winnings or received $100 more in your monthly salary.  Every financial decision should be made based on its effect on your overall financial wealth. If only it were that easy.  We are not robots and computers to constantly calculate every transaction against every financial goal or need.  It would be a daunting task since given the fact we are all emotional creatures.

Accounting money for different purposes has its benefits and drawbacks. The drawback is that the gambling loss was already accounted for…it was expected whereas the bank fees were not.  The benefit to accounting money, or “mental” accounting is that we set money aside to make sure we have money for the bills, retirement, savings, etc.

2. A dollar here and a dollar there equals real money

Take a look at these two scenarios:

Scenario 1: Imagine that you go to a department store to buy a work shirt. It sells for $50.  However, while at the store, you learn from your phone (you know, you can get an app to scan the bar code of the shirt and the app will locate other deals for you) that the same work shirt sells for $25 at another store 10 minutes away.  Do you go to the other store to make the purchase to get the lower price?

Scenario 2: Imagine that you go to a furniture store to buy a new bed set which sells for $1,950.  However, while at the store, you learn from your phone (yes, again) that the same bed set sells for  $1,925 at another store 10 minutes away.  Do you go to the other store to make the purchase to get the lower price?

I bet most people would drive to the other store to save $25 in the first scenario, but not in the second scenario.  Again, I ask, “why?”  Saving $25 should have the same value regardless of the size of the transaction.

3. Sales and discounts

Imagine two friends, Anne and Evelyn.  Anne said to Evelyn, “Oh, look! The store is having a sale.”  Evelyn responded, “Let’s go check it out.” And off they went only to leave the store with two extra bags in their hands.  And, yet, these are the same two people who say they don’t have enough money to save.

I’ve known people similar to Anne and Evelyn.  This is known as impulse buying which typically involves the use of a plastic card rather than cash.  A sale and discount doesn’t necessarily mean you are saving money. I can understand you buying more things with a specific dollar amount, but it doesn’t mean you’re saving.  The point of sales and discounts is for the store to have the opportunity to get rid of their inventory. To hurry up the process, the store advertises the sales and discounts to reduce the prices so you can buy more things.

Here are a few solutions to keep in mind (aside from setting up a budget):

  • Treat every dollar the same no matter the size of the transaction. When making a big purchase would you pay an extra $1800 for a navigation system in your current car?  If not, then don’t tack on the extra expense when buying a new car.
  • Automatically funnel money to your savings and retirement account. It’s easier to put money to the side automatically, then to write a check or manually make a transfer.
  • Pay with cash until you are able to control your spending. Ask yourself if you would pay for a particular item if you were paying cash rather than using your plastic card.  Your answer might be that you would pay less or not even make the purchase.
  • Treat all income as earned income. No matter if its bonuses, tax refunds, inheritances, or gifts.  Hold on to the money for a few months before making any spending decisions.  In the interim, park the money in your savings account.  When the time is up, you will view this money as savings.  And, your decision making process will adjust.

—————-
Ornella Grosz is a personal finance expert, speaker, and the author of Moneylicious: A Financial Clue for Generation Y. She blogs regularly at Moneyliciousblog.com, and has been featured as a financial expert on top hit radio stations across the country such as CBS, NBC, ABC, FOX, TheStreet.com,  AOL’s WalletPop and Daily Finance, CreditCards.com, and more.

J$: Again, I SUCK at not treating money the same! Do you guys have the same problem? Or do you find that it actually helps you one way or the other?

(Dollar Doodle from Jorymon.com)


{ 42 comments… read them below or add one }

1 Liam June 27, 2011 at 6:47 am

I am certainly guilty of not treating all dollars the same. One good example is Amazon Associates, which I see this site’s also a member of. Because I’m based outside the U.S., the only payment options available to me are checks or gift certificates. Most of the time, because of my bank’s international check fees, I opt for the gift certificate.

I have noticed that I spend those gift dollars a lot more freely than the other income I earn. I will spend it instantly (did so just this morning) and on products I probably wouldn’t have stumped up “real money” for. I find since the Amazon gift money has only one possible use: to spend on Amazon, I treat it very differently to money in my bank which can be used for all manner of things. There is a slight upside though: buying things I might otherwise have ignored, I have found new interests and tastes.

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2 Meghan June 27, 2011 at 6:53 am

I am more than guilty of not treating every $1 the same. I hadn’t even given it serious thought until you mentioned it! Of course, there are certain things in life I’d rather spend my money on than other things and on that note, those things are more valuable to me than the $1 but when it comes to certain situations I definitely need to give more thought to it.

I have told myself for (literally) months to at least try using only cash because I know I might not be as “bad” a spender as some people but there are definitely certain things I wouldn’t spend my money on if I was just going to use cash!

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3 Jenn @ Frugal Upstate June 27, 2011 at 7:37 am

Great post! there are some really interesting points in here about the psychology of spending money. The flip side of point 2 is that when folks are already spending a ton of money (think building a new house or buying a car) somehow it makes them feel free to spend even more. . . “Oh, getting the marble tile is only $1000 more on the $150,000″. . .

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4 Melissa June 27, 2011 at 7:39 am

I am definitely guilty of this. Somehow I don’t have much of a problem spending $50 for sushi for my family, but it irritates me when my weekly grocery expenditures go above $80 a week. (They are currently running $100 to $110.) Logic would say, just don’t eat out and I would save A LOT more than what I could at the grocery store skimping and saving, but my mind has yet to work that way.

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5 Andrew June 27, 2011 at 8:29 am

While I understand the intent, I think that scenario one sort of misses the point.people aren’t businesses and our spending isn’t just series of debits and credits against a ledger. In that scenario, the money “lost” to gambling was no more lost than the money spent to attend a concert or a movie: The money was used to pay for an entertainment expense, which presumably added some degree of personal value or pleasure to one’s life.

On the other hand, spending money on a bank fee is simply lost money. It’s no different than dropping a $100 bill in a running garbage disposal and walking away, since (presumably) no value was added to your life as a result of the fees.

I’d even go so far as to say that spending $100 on bank fees costs more to you personally than spending $200 on an entertainment expense, because you’re trading money for something (an experience, etc.)–not just throwing it away.

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6 MariaN June 27, 2011 at 8:53 am

Good post and it got me thinking. Right, I also suck at treating all money the same and tend to be a bit less responsible with money that is form wins and, surprisingly enough, a proportion of money from side hussle. Silly, I know and this article made me realise it; which will help watch it.

About the second point raised in the article – I am sure I won’t go to a shop 10 min away in the second scenario. And here I am not alone; in fact this is a well know experiment from behavioural economics illustrating the fact that all our judgements and decisions are made as a result of comparisons. Even the cleverest humans are not that clever – we all do that. $25 out of $50 – great! I’ll get it half price! $25 out of $1,750 – yes but the shop is tem minutes away and this is not so much anyway. In fact, the chances of any of us walking 10 min to get something cheaper increases with the ratio – if a pen is $10 in one shop and $2 ten minutes away most of us walk.

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7 cashflowmantra June 27, 2011 at 9:05 am

I agree. This is a very insightful and thought provoking post. I would be more upset about the bank than Vegas because I planned to lose that money. You are right that each and every dollar is important and should be watched after with the same diligence. Great example with the shirt and bed too.

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8 No Debt MBA June 27, 2011 at 9:07 am

I have a problem treating all dollars the same when it comes to scale. I might work to keep our weekly grocery bill $5 lower but when we were looking at houses a difference of $1,000 seemed like no big deal.

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9 Crystal June 27, 2011 at 10:15 am

She got me on the furniture vs shirt purchase. I would drive 10 minutes to save $25 on a shirt but not to save $25 on a couch…nope, apparently I don’t treat every dollar the same. I also do feel worse about a $2 bank fee than a $100 gambling loss precisely because I hate paying to get my own money but I budget for gambling losses if we are hitting a casino. Great post!

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10 Erin June 27, 2011 at 10:35 am

Good tips, but your tone is very scolding, superior and preachy. Pretty off-putting.

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11 Elise Adams June 27, 2011 at 10:38 am

GREAT post! And I’d take it further for us ‘poor folks’…we certainly don’t treat financial aid dollars or food stamp dollars the same as income from a paycheck. Don’t even get me started on housing assistance (like Section 8) or the local charity who’ll pay to keep your lights on when you’ve budgeted badly and are about to have em shut off.

With financial aid dollars so many students, whether they are young or returning, treat these dollars as if they are ‘free money’. Beyond the question of fraud (since this money is intended for education expenses only) it’s like you said–this money isn’t equated with what comes in a paycheck so often is wasted on ‘fun stuff’ instead of targeted at real expenses. Then everyone wonders how they’ll pay the babysitter or the electricity bill after they’ve got their new laptop or fancy phone! I, unfortunately, speak from experience :-(

As for food stamps: there is nothing worse for teaching financial responsibility. I know many families who routinely run out of food stamps because the concept of budgeting them seems silly–but it’s a finite amount, why wouldn’t you be careful NOT TO RUN OUT OF FOOD? On top of that the amount given to a large family is ridicules–we get $700/month for a family of 5! I’d never be budgeting that much out of our income if we were paying cash for our food (even at an annual income of 30k+, which is about double our current income!)

For a family on assistance, getting an honest REAL grasp of all those dollars coming in and being used up every single month is very difficult. While our income is low, the amount of assistance we receive easily doubles the amount of dollars we’re responsible for managing. Strange thought, right?

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12 CityFlips June 27, 2011 at 10:53 am

Guilty! Especially with “earned” money. Surprise money is always treated different than paycheck money.

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13 Kelsey June 27, 2011 at 11:12 am

WOW, that is totally me in the Mattress/Shirt example. I guess I think savings are relative, but you are right, I should be taking any extra $25 I can get.

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14 LB June 27, 2011 at 11:32 am

I don’t really fit any of these examples, I guess I like to calculate everything too much. Vegas would be fun money spent, bank fees would not, but either way I wouldn’t like it. Probably why I have never gone to Las Vegas. As for the mattress, I wouldn’t have to pay more for the mattress because the local comapny around here is generally cheaper and I would do research before hand. I definetely wouldn’t pay more for the shirt and would go for last seasons discounts through the internet first. I guess I just really really like my money. :)

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15 Stephanie June 27, 2011 at 11:40 am

Andrew brought up a great point about the $100 spend gambling versus bank fees.

From an economics standpoint, there’s a big difference between those $100 in terms of utility. At least if you lose that $100 gambling, you’re being entertained for a couple of hours, so you get some degree of satisfaction from it. Not so with the bank fee.

And I think focusing on the concept of utility really can help keep our spending in check. If we focus our discretionary spending on things that give us a great deal of (lasting) satisfaction (a fun night out with friends, eating good food, having a few drinks and building some wonderful memories), we’re less inclined to constantly chase those little “highs” you get from buying some stupid little thing that doesn’t make you happy for more than a day or two (like, say, that shirt you bought just because it was on clearance and seemed like a good deal, at the time even though you’re not 100% in love with it).

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16 Bill June 27, 2011 at 12:07 pm

This is known as penny wise and pound foolish.

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17 Ornella June 27, 2011 at 12:56 pm

It was interesting reading everyone’s comments. @ Erin, I’m not superior. I’m from NY. We (New Yorkers) are more straight to the point. The post is meant to be more informative, so the approach is more direct.

And to those of you who commented about Scenario 1, experience does play a factor. It was purposely left out to illustrate a simple point that we (including myself) tend to not treat all dollars the same. And, so we tend to place more value on certain things. The point was to value your money ( you work hard for it). I’m not against splurging, either. I’m actually an advocate for it. However, splurge when it makes financial sense for you. That’s one of the main points in my book.

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18 Kathy June 27, 2011 at 12:57 pm

Guilty!

Does the saying “being penny wise & pound foolish” fit this senario? Ironic; I’ve used that saying for myself for a while.

I’d feel equally bad about losing the $100 in Vegas & the $100 in bank fees. NOT a gambler and can’t stand Vegas….so, I’d feel like I was throwing my money away.

Think I might be one of the few that ‘would’ go to the other store 10 min away to save $25 (either senario). That would be, of course, after I talk to the manager about matching the price.

@MariaN ~ good point about senario 1 is a 50% savings & senario 2 isn’t. In the end, it’s still $25.

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19 Richard June 27, 2011 at 1:18 pm

1) The difference is expectation. You decided to spend $200 on entertainment, and only spend $100. You (presumably) got value for this money in entertainment. With unexpected bank fees, you get nothing for it, and weren’t expecting it. Of course it’s annoying. If the bank fees were for some service rendered, and it was worthwhile and expected, that would be fine.

2) The difference between saving $25 on a $50 shirt and $25 on a $2000 bed is frequency. You buy a few shirts a year, so saving $25 a few times every year is actually worth a whole lot more than $25 once every ten years. This is also why it’s worth getting the $2 filter over the $5 latte.

3) You have a point there.

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20 Jenna June 27, 2011 at 1:46 pm

I tend to view my money pretty equally. I just had a birthday and got a check from my parents as a gift, and I’m actually considering using that to pay down my student loans rather than spend it!

I know where every dollar I make goes, and that knowledge is power. Once you understand your spending habits, you can understand that every decision you make is a tradeoff. That $25 saved (on either a shirt or a bed) has more importance to you if you know what you would do with it. Otherwise, it can be easy to just throw away, especially when it’s a small percentage of your total purchase. I think Anne & Evelyn might have thought twice about that sale if they were planning a vacation together, and could have instead considered that they could use that money to go on their trip earlier by setting the money aside now.

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21 retirebyforty June 27, 2011 at 2:30 pm

It’s only human to treat each $ differently. Of course I hate unexpected bank fee! It is much more painful than spending $100 to eat out at a fancy restaurant. Anything budgeted for are easier to let go of.
Our spending is pretty much under control, but we still prefer cash over credit.

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22 Ashley @ Money Talks June 27, 2011 at 2:50 pm

I’m guilty of this. not so much the shopping aspect of it but how I earned it does make me want to spend it in a different way.

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23 LLF June 27, 2011 at 3:34 pm

I always see my money as a whole instead of earned vs bonus. When I buy anything, I always wait to see if I am getting the best deal, whether it’s a $25 or a $2000 purchase. The ONLY time when I am willing to pay more is if it’s a reputable company and if I have to spend more time than I have to get the smaller price. There comes a tipping point of cost-benefit in terms of money vs time.

For spending the same amount of money, and seeing it in different POV, see my comment under this post http://www.thousandaire.com/blog/move-on-when-you-lose-money/. When you are out $100, you are out $100. It’s what that $100 get you is what makes your emotions go crazy.

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24 Barb Friedberg June 27, 2011 at 4:44 pm

I have been thinking about this “mental accounting” phenomenon quite a bit as we are making a big move across the country, selling the current home and buying a new one. Money is flying out the window. I made a decision, during this stressful transition I am not going to worry about the smaller expenditures at all. It won’t make a big difference to us financially in the long run, and the stress of worrying about a few bucks would probably push me over the top. I really liked your examples. Nice article.

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25 Lacey June 27, 2011 at 6:37 pm

It should also be noted that they’ve proven when using cash your brain registers the ‘loss’ as a sort of mental pain. When spending with plastic, specifically credit, but debit to an extent to, I believe, the brain does not register the ‘loss’.

A good reason not to use credit. As if we needed another one :)

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26 Mary M June 27, 2011 at 7:47 pm

Great post, and I’m a southerner and I didn’t think you sounded at all superior or harsh!

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27 Edward Antrobus June 27, 2011 at 8:09 pm

I’m actually more likely to spend if I have cash on me. Cash isn’t in the budget. So I’m free to spend it without worrying and then use it all on impulse purchases. If I have money in my pocket, I WILL get a bag of pretzels out of the vending machine (50 cents) even though I could just get a bag that would last me 2 weeks for the price of two little bags. But when I’m at the grocery store picking up filler items (like milk), I’ve been known to put impulse items back down because I couldn’t justify going over budget.

In senario 2, you could save even more money by getting rid of that smart phone and data plan and going with a more basic phone. Then spend a few minutes at home comparison shopping online before going out to spend almost $2000

As far as bullet point 4, very rarely will you receive unexpected money. You may be given money, or get a tax refund, but you usually know what it is going to be before you receive it. That’s when I decide what it’s being used for. Sometimes even before I know the actual amount…my wife’s new computer was budgeted with the tax refund even before the year ended!

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28 J. Money June 27, 2011 at 10:51 pm

Thanks again for stopping by and sharing w/ us today Ornella! Was/is VERY interesting to read and think about. Especially with everyone else’s thoughts being spread as well. And you can tell it was good because we got mentioned in LifeHacker today!!! Wooo! So thanks again my friend, way to get our attention :)

@Liam – HAH! I do the *exact* same thing!! Literally – last night! I dropped $30 on 2 pairs of socks cuz I had the credit and didn’t want to go bargain shopping all over the place (they were toe-socks for my new FiveFingers shoes). Excellent excellent example, my man.
@Jenn @ Frugal Upstate – Haha, that’s for damn sure :)
@Andrew – I would agree with that! Although I have to admit ripping a $100 bill to shreds in my garbage disposal actually would be kinda entertaining ;) But only because I’d film it and then blog about it and see what everyone has to say about it! haha…. hmmmm…
@MariaN – I used to treat my side hustles as “do whatever I want money” too ;) And I actually think that’s a great way to think too – I’m still keeping some dollars seperate than others even if they are technically worth the same.
@Erin – Wow, really? I didn’t catch that when reading it through… interesting though.
@Elise Adams – YES!!! Budgeting goes with everything, including FOOD! Good one :)
@Stephanie – Agreed! Kinda like me spending $100 on lottery tickets too – it’s all about the experience and satisfaction I get from the “what ifs” even if I lose every single one of them… which came close in my lottery experiment, haha…
@Jenna – You beat me on that one :) I always use birthday/xmas money on things I’d normally not buy myself. It’s the only time I really do that, and it keeps me excited and not hardcore about always being super frugal! haha…
@Barb Friedberg – I’m right with you on that one! But only because you and I know what we’re doing with our money and are not in crazy amounts of debt. Which is one of the perks of managing your money well – you get more freedom down the road to relax a little!
@Edward Antrobus – Get rid of smart phone? Are you trying to depress me?? :)

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29 Rafiki June 27, 2011 at 11:24 pm

I believe I have the same problem. It really struck me with point number 2.

Interesting post and a good eye opener.

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30 Forest June 28, 2011 at 8:33 am

This really is an awesome post and that isn’t one of those “great post” spam comments.

I love the idea of treating your salary like you won it each month :). Good excuse to celebrate (but not go spend it all!).

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31 joe June 28, 2011 at 1:51 pm

one issue to really consider these days is gas. is there any point in saving a dollar on something if it takes you $3 of gas to get there? also, factor gas prices into your decisions as travel expenses with gas prices what they are are getting real, and gas is likely to get more expensive, not less. remember this when looking for your next vehicle.

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32 J. Money June 28, 2011 at 5:01 pm

@Forest – haha, is yours ever a great post spam comment? :)
@joe – very true about gas. but even more importantly, TIME. saving $25 to leave stores and park and wait in line and do all that stuff could take an hour or so, which most days isn’t worth it to me. if I happen to be caught up w/ work, then maybe ;)

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33 Edward Antrobus June 28, 2011 at 10:29 pm

J, Somehow I survive with a basic QWERTY phone and no data plan. Try it sometime. :)

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34 Kristin June 28, 2011 at 10:33 pm

Like Joe and J.Money said, I would also factor in time, gas, and effort here. My boyfriend is all about trying to find an awesome deal online. I, however, especially with more expensive clothes or gear, like to go to a store and try things on, talk to the salesperson, make sure the item is exactly what I want/need. If something is not an impulse buy and I’ve been looking/researching for awhile, I’m willing to drop a few extra bucks to get it right there and then, because I know I have my item, it will fit, and I won’t have to wait/ship/return/miss-a-flash-sale anything. He spends a lot of time reselling or returning items. To be mentally done with the purchase is worth a few dollars to me. So I don’t treat every dollar the same, and I don’t think it’s always appropriate to do so, either – there are often other hidden effects or benefits involved. (Maybe the first furniture store can deliver when you will be home, where the other one will be a hassle).

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35 J. Money June 29, 2011 at 7:28 pm

@Edward Antrobus – No way – that’s my life (and now career) when I’m on the road ;) I don’t need to bring my laptop if I’ve got my iPhone w/ me on shorter trips!
@Kristin – Yup! If everything seems “right” at a store, I don’t risk it at another either just for a few bucks. Especially w/ clothes and stuff that can be tweaked a bit per item (or like shoes that all fit differently even though they’re the same size).

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36 Kate July 1, 2011 at 1:56 pm

The tile will make your home worth more and probably be more durable not to mention more enjoyable. That expenditure was an investment, not a throw away purchase, so it’s hardly an apples to apples comparison. There may be a big difference in delivery fees at different furniture stores, so that felt like a bad example.
I used to get irritated at atm fees being high in the building I work until I realized, I would easily pay someone a dollar and a quarter to run and get me the cash.
Personally I get really anal about large expenditures and explore every possibility of car model and accessory before I buy, which I do in the most frugal way possible. Lunch for every day, I don’t fuss over because that time adds up and I don’t think it’s worth it.
Time is worth more than money.

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37 Ornella Grosz July 1, 2011 at 2:15 pm

I enjoyed reading everyone comments. It is always interesting to see how people view money. try not to take the examples to heart, just take the learning lesson on how we view and value money. Have a great Fourth of July!

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38 william July 3, 2011 at 6:24 pm

your examples are really… REALLY terrible.

comparing an evening of gambling with a bank fee is incomparable. An evening spent with friends provided entertainment. Also most sane people go in w/the understanding that they may lose. there is a built in expectation. there is also the possibilit of winning. There is “winning” a fee with the bank. If the bank mistakenly puts cash in your account, it will be taken back. And what bank fee costs $100? if I’m hit with a bankfee of $100 then a) I’ve got a reallllly crappy bank and b) I’ve either seriously mismanaged my bank account and/or got some serious financial issues. Either way I’ve got some serious problems which will require my time and attention and may also involve me looking for a new bank. None of this has squat to do with the money lost in bank fees. It is the hassle of dealing with the sitation.

As for shirts and beds…. buying a shirt is a simple transaction. buying a bed is not. is the bed in stock is the first issue. assuming yes, Is the other company more reliable? or less? do you have experience w/either company? will there be a delivery fee? or a hail away fee? that could easily negate any savings? In all lilihood I would just say to the bed store guy “hey can you price match the other store?” and he will likely say yes, because I’ve done this myself.

Sorry dude, your examples suck and your evidence is “you think the answer is such and such.” Sorry, but I want to see some data not opinion.

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39 Ornella Grosz July 3, 2011 at 8:56 pm

@William. Wow, William. I apologize you didn’t like the article. Well, so you know the example are based on behavioral economics. Basically, it’s about the emotions behind our decisions. “Expectations and “simple transactions” are behind our emotions decisions on how we VALUE money. The point of the article was about how we tend to change the value of a dollar when we justify ourselves for the expenditures. If you would like, you can learn more about me at http://www.moneyliciousblog.com and at http://www.moneyliciousbook.com. I’m licensed in the financial industry. Have a great Fourth of July.

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40 william July 4, 2011 at 7:22 pm

@ ornella

The premise behind the article is solid. unfortunately (for me anyway) the poor examples stood in the way of the point to where the point was not just obscured but actually in the first case, I think the opposite point was made by the example. $100 SHOULD be valued equally and yet I think the gambling vs bank fee is justification of why they are not valued equally, and that’s because it isn’t always jsut about the money. Often there are other considerations involved.

I would say that better examples where money was the sole factor would’ve made for a better article

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41 Ornella Grosz July 4, 2011 at 8:59 pm

The examples are not just from me but from research. The point of the article was not to illustrate money as a sole factor. As I state in the first example, we are not robots, but rather emotional creatures which impact our decisions. And I do say the $100 should be valued equally. It’s our justification for the expectation of losing versus the unexpected bank fee that changes the value. In addition, I had written this article (short) so readers may manage their money from a different light and why at times (I do it, too) we make bad decisions when we allow our emotions to interfere. I’m in no way telling anyone what to do with their money. Plus, it’s interesting to see how many readers can view the same article differently and take it out of context. It’s ok if you don’t like the examples. Everyone is entitled to their own opinion. But, next time, slow down on the hatred, dude…so wasn’t necessary ;) Have a good evening.

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42 william July 4, 2011 at 9:44 pm

But, next time, slow down on the hatred, dude…so wasn’t necessary

//citation needed.

show me where I demonstrated *hatred* yeah I said the examples were terrible. i even said they sucked. even labeling that as harsh criticism is a stretch, but to say that was hatred? please. are you suggesting that criticism is not permitted? I’m, really curuous what consituted hatred in what I said.

and if this is based on research I wish we had some more of the research because so much of this article was written as opinion. nowhere is data cited.Instead we get “Bet most people would” and then in example two… why it’s the exact same phrase “I bet mot people would”. no reference to studies or research or polls or any actual facts. this sounds like some guy’s blog expressing his opinion. Now I do know that what you’re saying is based on research and is sound advice but I didn’t know that because of this blog entry, I know it because I read it elsewhere. if that’s harsh, sorry man, that’s not hatred, thats the facts as I see it.

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