A few days ago it was a friend’s birthday.
What we usually do in these cases is to collect money among all the colleagues in the group and buy a common gift for the birthday boy.
The custom is to put the money between everyone, but then only one is in charge of buying the gift … and this time it was my turn to buy the gift.
Surely you have also seen yourself in the position of having to buy a common gift for someone. So, you will know that choosing it is not an easy task.
And having to give another person many times is a bit brown. If want to know how the poor, the middle class and the rich spend their money, continue from here.
I tried to find the inspiration to make a special gift to my colleague thinking about his tastes and hobbies, but no matter how much he thought about it, I could not think of a good idea.
He was thinking about original options, but he was not sure if they were going to be of his liking, nor whether they were going to adjust to the budget.
In the end, in these cases, you have two options: either try to drain the package, buy anything, and distribute responsibilities among all who participate in the gift.
These are questions that make us reflect on how humans react to spending money according to certain circumstances.
Therefore, I have written this article in which I will analyze what I think are the four psychological ways of spending money.
Psychological ways to spend money
Surely knowing them is useful when it comes to using your money and managing your investments.
1 – Spend your money on yourself
This can be said to be the most common way in which we all spend money.
It consists of spending your own money on yourself.
That money that belongs to you and is your property and that you spend on things that you are going to use or enjoy nothing more than you.
From a psychological point of view, it is evident that in this case, you are going to be very careful with your money.
You will spend the right amount of money, and you will try to do it in the most efficient way to get the product or service that best satisfies your wishes or needs.
It could be said that it is a question of selfishness, but also of evolutionary intelligence: we are thus programmed.
Even the spendthrift will look more carefully at what he spends his own money, and use it to satisfy his wants or needs in the best way.
When you spend money on yourself you are very careful how you spend it, and you make sure you get the best for it. “
2 – Spend your money on someone else
In this case, what you do is spend money on your property for the benefit of another person who is not you.
As an example, we can put the typical case in which you make a gift to a person on your part using your own money for it.
It may also be the case of having to buy something from someone because you have that obligation.
As an example, we can put the one of having to buy a new air conditioner to the tenants to whom you have rented your home since it has suffered a breakdown.
I am sure that you will not buy the best device in the market, rather you will be looking for one at a good price.
Or imagine that your son has made a prank at school and has broken a window of a pitch, and you claim the cost of repair.
It is very possible that in that case, you bother to look for glassware that is cheap to spend as little as possible, and surely you do not care too much about the quality of that glass or its assembly.
In this case, human psychology tends to be careful with the money we spend, but we do not worry so much about the quality or the benefit offered by what we are going to buy.
You look for something at the best price, but you do not bother so much in obtaining the best product.
Careful in spending, but unconcerned about the quality of the purchase.
You will never pay as much attention to the gifts you buy for others as on the things you buy for yourself. “
3 – Spend someone else’s money on yourself
This is a great case, right?
Spend money that is not yours, but it is from someone else, and you do it for your own benefit.
Imagine that, because of your work, your company pays you a maintenance diet because you have been sent to a meeting or a training course away from your home or place of work.
Would you care about costs or quality?
I’m sure not.
After all, your company will be the one that will pay for the restaurant and the hotel.
Surely you eat the best possible and look for the best accommodation.
It does not matter if you have an amount limit; You will look for the best that suits you up to the price limit you have set.
When the money is from others, and we are the beneficiaries, we are very light when it comes to asking and spending money without consideration.
Therefore, from this psychological perspective, who spends the money wants the greatest benefit for him without caring about the expense and trying to get the best product or service possible.
4 – Spend the money of other people on someone who is not us
This is possibly the case in which it is easier to spend money.
Neither is my money nor will I get my own benefit.
From a psychological point of view, what do you think will happen in this case?
Sure you have it clear.
Nor are you going to worry about whether you spend a lot or little, nor will you try to achieve the best result.
It is a clear example of how politicians spend money.
They use money that is not their own, but the taxpayer’s, and they spend it supposedly for the benefit of society.
And what about politicians and spending public money?
Well, I think it’s no secret for anyone to know that when politicians use public money they do it inefficiently and carelessly.
They do not care about wasting it in a bad way or causing a huge debt in the accounts.
Total disregard for both the expense and the results.
Although honest and professional people rule (complicated thing) human psychology will remain the same and will push those politicians along the same path sooner or later.
That’s why the ideology or the party does not matter; Human psychology will always lead people along the same path, it is inevitable.
And the same can apply when you put your money in the hands of others, in this case for someone to invest it and get a return for it.
If you are going to put your money under the care of a bank, or you are going to invest it in an investment fund, for example, you have to be very careful of whom to trust.
These banks, companies or managers will try to get a return on your money; It is your job, but you will not pay as much attention to it as you would put it yourself.
After all, it’s not your money.
It is important at the time of investing that you look for someone who has their interests aligned with yours : that the other party also pays a price if he does not take care of your money or does not get good results with it.
Therefore, it is always interesting to invest in fund managers where their managers invest their own money in the fund they administer.
Or put the money in the hands of people or entities that play their own business in the results they get with their customers’ money.
For the same reason, we must be careful when investing in companies in which it is a board of directors who controls them without taking too much risk in the future of the business, especially when they have their future with millionaire dismissals, indemnifications and retirements.
On the contrary, investing in family businesses or managed by its founders is always a better guarantee that the management team will do its utmost and will be very careful with that company.
After all, they are playing their own money.
This question is something to take into account when buying stock of a certain company. Remember it.
In short, when we spend money that is not ours in people that are not us, it is inevitable that anyone does not pay attention to how he spends that money. “
You have already seen the four possible ways to spend money and how human psychology influences them.
These psychological perspectives on money will be useful to know yourself and to know how others will treat your money.
It also helps us all to draw conclusions about how we administer ourselves as individuals and as a society .
I think it is clear that the justest and efficient way to spend and manage money is when you own it and use it for your personal benefit.
In the other cases, either money is wasted or the results of what is obtained with that money are neglected .
I think that this article should serve us to reflect from a personal point of view, but also, why not, from a political point of view.
My consideration is that if we want a more just and efficient society we must always aim at the first point: that each person can have their economic resources to manage their lives according to their tastes, objectives and vital needs.
Nobody like yourself to manage your wealth and provide yourself with what is best for you or just makes you happy, whether it is saving, traveling, helping others …
Putting our money in the hands of third parties to provide us with the services we need only leads to inefficiencies, waste and poor quality services.
Seeing the psychology of how humans spend money, it does not make much sense that the vast majority of our personal wealth is put in the hands of politicians.
That’s why I think this article may be good for reflecting and considering a different way of doing things.
Human psychology has been formed over thousands of years of evolution and we will not be able to change it suddenly.
The human being as a whole will always tend to act as I have explained in this article as far as the expenditure of money is concerned.
To deny it is to deny human nature.
That’s why I think we should use this knowledge to do things in a more intelligent way.
Learn that you are the best guardian of your money, that you should be cautious when you give it to others to spend or administer, and that politicians will never manage everyone’s money better than we can individually do, both people like companies. “
And what do you think about all this? Now is your turn.