What’s Your Spending Mentality?

by Bill on March 16, 2012

Does your financial mentality follow the herd or suit your personal needs?

How does your financial mentality affect your spending? I know, odd question to lead with. But lets look at this. And I warn you, this is a long post today.

Okay, first what is a financial mentality? It could be defined as a few things.

  • the Herd Mentality
  • the Entitlement Mentality
  • the Poverty Mentality
  • you can’t take it with you

Here come the examples.

The Herd Mentality

Simply put, this is also called “keeping up with the Jones’s”. This can also be a distructive financial mentality in relation to spending. Here’s a few examples to check yourself against:

  • Everybody around you has, or is getting, new things for their yard/home this season so you have to update your yard/home.
  • Someone in the neighborhood is always trying to be the first one to “have” something, so you join the race whether you can afford it or not.
  • You must have a certain way of life that fits within the neighborhood ideal; this includes gadgets, bobbles and toys.

The problem with the herd mentality is that the herd isn’t paying your bills, nor are they responsible for them. And no, they wouldn’t care if you fell behind. Trust me.

So, what to do to fix this. And yes, I can hear the “but we can’t move out” speech echoing. Here’s few ideas to help you brainstorm:

  • figure out what is worthwhile to YOUR family and YOUR life. Live on that, live for that.
  • Live within what you can to make your basic needs attainable. Remember what it cost to have a roof over your head, food in the belly and clothes on your back. Keep yourself safe and healthy because no one else will.
  • If you honestly cannot live without being on even footing with the neighborhood, move. Yes, I will say move. You probably can’t afford to live there anyhow. Find a location where you can afford the basic needs and you can live with yourself.

The Entitlement Mentality

This is one financial mentality I hate. This is the one that most welfare recipients get blamed with; although it is not all “welfare” people that have this. Let’s get this straight – if you think the money is owed to you when you did not work for it, you have this mentality.

  • If you live with someone and don’t pay for at least your own basic upkeep, you have this mentality.
  • If you get government assistance and make no effort, even remotely, to break free (via education or work search or networking whatever), you have this mentality.
  • If you constantly tell people you “deserve” more money for what you do, you may have this mentality.
  • If you tell someone you are “owed” something because you did something for them, you may have an entitlement mentality.

Here’s a few things to consider now that I’ve probably pissed somebody off:

  • Can the person you are living with support you solely on their own, without help, and without stress? Would they be better able to handle the house with some support. If they were not there, would you be supporting yourself anyhow?
  • Why would the government, or anybody, owe you for your existance? What if that support vanished? What if it was reduced? Yes, there’s a difference between being in a low spot and looking for a way out, and just waiting for someone to kick up a contribution because you are there.
  • Did you do something as part of a mutual agreement? Working for a specified wage is done via mutual agreement; don’t like it, go find something else.
  • Why did you do something for someone else? Was it as a favor? Was it intentional? Did they know they owed you or did you expect it?

The Poverty Mentality

Here is a spending mentality that is sad and sometimes heartbreaking. This is also one that I have suffered from, and sometimes still do.

  • It’s when you are so financially deprived that every penny is counted, every purchase hurts because you don’t know if you might need that money for something else.
  • You scrutinize needs in priority of what can be pushed back to next week.
  • Your goals remain low because you are afraid of loosing what you currently have.
  • You don’t plan too far ahead for fear of not being able to get there.
  • You wish you could have so much more, the wants and wishes overshadow the needs and what you already have.

How do you overcome this one? This is one of the hardest spending mentalities to change. But, here’s a few ideas from someone who was actually in this position:

  • Go back to what you believe internally. Find what brings peace within yourself.
  • Keep current with basic needs such as clothing, housing and food. Do not allow yourself to be deprived of your humanity.
  • Realize that there are literally thousands of other families, and probably hundreds of thousands of people in America who are in this exact same position. You are not alone, so there is nothing to be ashamed of.

 You Can’t Take it With You

I have neighbors who follow this one. I still can’t figure it out. Yes, you can’t take it with you, but to go to extreme is a disaster in waiting.

  • You have no savings plan, or account, at all.
  • You have to borrow money at the end of each month to get to the next month.
  • You don’t bother looking at the price, you just buy it and figure out how to pay for it later.

While I do agree that in the end you can’t take material possessions with you, I don’t agree with ignoring obvious financial safety measures.

  • Get an emergency fund. Set up a percentage or a dollar amount. You don’t know when a monetary pothole will show up in the road.
  • Make a budget and prioritize. Having to borrow money every month can’t be all that fun.
  • Make things last. Just because it won’t last forever doesn’t mean you need to wear it out as quickly as possible.
  • Don’t live a disposable lifestyle. All those paper plates, razors, fast food meals and such cost more to consume than living without them.

Notice most of these are not workable in reality, even though they look good in theory.

What’s your spending mentality?
William Swan, writer

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Crystal March 16, 2012 at 6:53 pm

Each of these is devastating in its own way. Thankfully, I don’t fit into any of the four – but I have friends and family that do and the results range from inconvenient to disastrous. Any chance of a follow-up post highlighting positive financial mentalities?
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Felicia March 17, 2012 at 1:50 am

What a heart-felt post. I’ve got to say that I believe I’ve suffered from at least 3 of the 4 mentalities.

Being the odd one (aka dancing to the beat of a different drummer), I’ve tried to fit in with the herd so I ended up spending on things that really meant very little to me. That behavior occurred when I was young and insecure. Never had the entitlement mentality, but have rented apartments to folks with such lifestyles. They always had their hands out.

I’m being a bit self-indulgent and am taking the liberty of altering the title of the poverty mentality to the frugal mentality. I truly believe there’s enough to go around, but just because there is enough, there’s no need to spend foolishly. We are all stewards (whether we want to believe it or not).

And finally, I believe you can’t take it with you so it’s up to us to invest in things we can take with us like love, respect and integrity.

Bill, I’ve got to say that I’m really enjoying this blog and your posts.
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Bill March 17, 2012 at 1:14 pm

Hey Crystal!

The idea of highlighting the positive side did occur to me, but I wanted to point out possible warning signs first.

Possible guest post if you want a crack at it.

Bill March 17, 2012 at 1:16 pm


Somehow, my best posts always come from personal examples. The one thing I tend to see from both myself, and others, is its not the actions but the awareness of the problem or consequence.

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