We make more money only to fund higher lifestyle – street smart finance
I got very excited when my pay rise request was finally approved. To me it presented an opportunity to escape from the vicious cycle of living from one pay cheque to another. We’ll two months down the line and I am yet to see much change in my personal finance. I have only managed to achieve half of what I had anticipated from the pay rise and surprisingly, my expenditure has doubled. Do we make more money only to fund higher lifestyle?
We live in a culture where possession depicts financial progress in one’s life. Sounds a little bit complex, right? Well, as Shilpan from Street Smart Finance Magazine puts it: As we make more money, we are automatically conditioned to spend more to buy things we don’t need. We go out of our way to please people who don’t contribute much to our lives. It is because of this we find ourselves trapped in the same financial position in spite of making more and more money.
Below are three factors that negatively influence how we spend our money:
The illusion of happiness
I have been lucky enough to have found a relatively cheap apartment that is approximately 15 minutes walk from my work place meaning I always walk to work and save on travel expenses. The main problem with my apartment is frequent water shortages which to some extent I have managed to cope with well. After my pay rise was approved, I found myself unhappy staying in this apartment and I have even been tempted to move out, but here’s the problem: I am currently paying KES 8,000 and if I am to move to an apartment that is close to my work place I’ll find myself having to pay double on rent. Moving to a more expensive apartment will have a negative impact on my savings and won’t necessarily guarantee my happiness.
The only way that I can make the most out of my money is to escape from the bondage of possessions. At the end of the day, my happiness is based in knowing that my financial future is secured.
Desire to impress
Our friends and relatives have a significant impact on how we spend our money; they influence our attitude and thoughts, especially when it comes to money. When one starts earning more they automatically find themselves wanting to please others with their finances. It’s in our human nature to want to show off and at most times we do at the expense of our finances. It is no wonder most guys would want to take that girl they are interested in to a fancy restaurant in order to impress her. Or in order to gain your family’s respect and recognition you’ll find yourself spending more on them. Here’s the thing, the society will never be content and they will always want more and when you stop trying to please them they start talking negatively about you. It’s best to help or try to impress up to a certain extent, don’t jeopardize your expenses trying to please others.
Remember, as Will Smith once put it, we spend money that we do not have, on things we do not need, to impress people who do not care
In as much as our thoughts are intangible, they shape our lives. A few years back a friend of mine bought a brand new Subaru Legacy. A week after buying the car he saw a Subaru Outback which impressed him to the extent of him viewing his once precious and significant Subaru Legacy as being so insignificant in comparison to the Subaru Outback.
History has taught us that’s it’s in our nature to want more. Communities fought each other in order to expand their territories and political influence, the colonialists conquered Africa and scrambled for vast territories in order to exploit the territories and express their political might.
The mere thought of knowing you are earning a little bit more than you did before could push you to want to spend more and subsequently lowering one’s ability to save more.
At the end of the day, if you are unable to understand what true happiness means, or the loss in trying to please others, or how to control your thoughts, you will be trapped in the vicious cycle of earning more only to fund a higher lifestyle.