It is ridiculous that we sometimes base our spending decisions on stories we tell ourselves instead of our actual situation.
One day, a neighbor comes home with a fancy new car and the stories start pouring into our head.
That car costs $100,000!
The insurance must cost a fortune!
Where did she get the money for that?
They must be more successful than me!
And, after a time, these stories lead us to spend a lot of money we wouldn’t otherwise – perhaps on a car or perhaps on something else.
It sounds crazy when you think about it this way, but it’s actually behavior that is academically proven – and if we are honest with ourselves, it is a very recognizable pattern.
Instead of basing our behavior on how we think our income compares to our neighbors, what if we could base our behavior on our actual situation?
Wouldn’t that be more likely to lead to our long term success?
For more details, check out a deeper analysis at www.BestFinLife.com/blog, but in this space I want to simply make the point that this can be very important.
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Best Financial Life is a Registered Investment Advisor with the State of California and Joe Morgan is a fiduciary to his clients at all times. If you’d like to ensure your finances are on the right track, schedule a call with Joe at www. calendly.com/bestfinlife.
By Joe Morgan, CFP®, CFA, Principal: Best Financial Life, Resident since 2004
