This Is a subjet that I see as probably the biggest problem in our world today. Its a problem that keeps us from living life with a true perspective of ourselves and keeps us from seeing the things that are truly important in this life.
In today’s society we are all affected by the common mentality called, False Entitlement, a belief that you deserve to have something you didn’t necessarily earn.
The race is on. Everyone is looking for the smartest phone, the coolest car and the biggest flat screen. Add the latest computers and you've created a list of America's growing "necessities."
We live in a society heavily marketed, rushing to keep up with “The Joneses” the problem is, the Joneses are broke!
The Media uses entitlement to convince you that you deserve to spend, whether you can afford it or not. You see it every day as you turn on the TV: “L'OrĂ©al: Because your Worth it!” Burger King: “Have it your way” Or the luxury vehicle commercial with the word “RESPECT” in big letters on the screen. The chant “I want it all, and I want it now!” rings in our ears.
Scott Hannah, President of the Credit Counseling Society said,
“The problem is, that it’s hard, often impossible to detach the emotion from the purpose of spending and to separate the rational part of spending on genuine needs.”
The problem I want to express is that False Entitlement creates overspending.
The first evidence of this wide spread problem, is the number of home foreclosures that popped the housing bubble in 2008.
Jonathan Kohn & Sarah K. Bryant Of The University of Pennsylvania said:
“Consumers went on a spending spree driven by higher and higher, real and perceived home equity values, as well as equity market increases. In the US market, “bigger is better” or “as much as one can afford” became the mentality of home buyers.”
According to RealtyTrac.com (as featured In The Huffington post)
On average, 104,000 homes have entered the foreclosure process each month this year.
The second piece of evidence is the nation’s massive credit card debt. According to the U.S. Federal Reserve, The Total U.S. credit card debt is $793.1 Billion, the average credit card debt per household is $15,800, and the average credit card debt carried by undergraduate college students is $3,173
We live in difficult times. Our society’s mentality of Entitlement as a nation has helped damaged our economy, but there are solutions, and hope for a brighter future for us and our nation but, it requires each of us to be responsible for our individual actions.
It is an everyday dilemma weather to use cash or plastic for a new outfit, a dinner out, or perhaps a vacation. Since plastic postpones the moment of reckoning. We should limit credit card purchases and practice self control. We must come to grips with the reality, that feelings of entitlement emotionally grants us the ability to buy without guilt, whether we really need the item or not.
As featured in The Wall Street Journal, Here are 7 helpful tips provided by MoneyCrashers.com to help you cut back on spending:
- Rarely use credit cards or other lines of credit. using cash, forces you to
consider how much you’re spending.
- Withdraw cash from your bank account yourself, so that you can see the dwindling
balance.
- Pay for everything as it comes, and you’ll better understand how
all that money “gets away from you.”
- Be vocal about your savings goals. If you tell close friends and
family how much you intend to save, they’ll hold you accountable. You can
even use personal goal setting tools like stickK.com
- Reward yourself when you meet your goals, but only by spending a small
percentage of what you saved. This can help prevent “frugal fatigue”.
- Stop and ask yourself before each purchase “do I truly need
the item or not.” Know the difference
between needs and wants.
- Look at the future, no matter how uncomfortable it is. Ask yourself “how much money
do I need to retire?”,
or “how will I pay for my
child’s college education?”
If we can practice these steps, we can overcome the guiltless effect of false entitlement and be better equipped to tackle overspending.
I challenge each of you to make a difference in your own life and in society. Take responsibility for your individual actions and by seting financial goals, budgets and limiting spending.
If you or someone you know, needs more information to take control of personal debt and spending, go to the website for the The National Association of Personal Financial Advisors:
napfa.org to locate an advisor near you and start making a difference today.