Is a sense of entitlement holding back your finances? We all operate from an entitlement perspective at times when we believe we deserve a special purchase or have the right to spend our money how we see fit. And you do deserve to reward yourself for working hard, but what happens when those rewards get bigger and more expensive, like that HD television or that new Cadillac Escalade? What good is a million dollar house if you’re never home to enjoy it because you have to work overtime just to make your mortgage payment? Sometimes, that urge to buy something you deserve (or something your neighbor has that you think you deserve as well) can significantly hurt your financial health.
When considering a purchase, if the thought that you “deserve it” comes into play, here are a few tips to help you evaluate the financial soundness of following through with your purchase.
- Ask yourself if the desire to purchase the item is born out of greed. We all get greedy at times, even if none of us admit to it. We think we need more than we actually do, and often, obtaining that big purchase just leads to the desire to make another big purchase. Ask yourself if a smaller or less expensive item would suffice in its place, and examine your motives for wanting the expensive purchase. If greed pops up its ugly head, you may regret your decision later.
- Am I spending more money than I should because of an unexpected windfall? Often, when unexpected cash comes our way, we mistakenly believe the money is ours to spend however we like. You should have a system in place for dealing with extra cash, such as putting 30% towards an emergency fund, giving 10% to charity, and saving 50% in retirement accounts. This helps you spend your money more wisely while still allowing you some freedom to make those entitled purchases.
- Am I buying out of emotional stress? If you have a bad day at work and find yourself at the mall with credit card in hand, you know the purchases you make will likely be based on a poor decision. When feeling emotional and looking for a purchase to make you feel better, try substituting a small splurge, like an ice cream sundae or a fun ink pen – something fun that won’t dent your budget. If you’re still feeling the urge to splurge, it’s time to take action. Leave the shopping center and engage in something stress relieving. Go for a walk, go to the gym or park, journal, rip paper into tiny bits, sing at the top of your lungs, play games, read a book, or watch some television. All these activities hold the potential to substitute a shopping splurge on a bad day.
- Recognize that all purchases are made based on our emotions. We may use judgement and logic to justify the purchase, but initially, its emotion that sparks the needs to buy. Identify the emotion and see if it can and should be dealt with in a more appropriate manner.
Personally, I have a sense of entitlement regarding the tennis shoes I buy and the office equipment I use. I think I’ve “earned” the right to wear name-brand shoes after years of standing on my feet caring for patients. I also prefer Apple or Android products when it comes to office electronics because I think they work well and make my work-life more rewarding. These are justifiable reasons to support my preferences, but the truth is, a $20 pair of Champion shoes from Payless work just as well as Nike branded running shoes, and my $300 Acer laptop types out sales copy just as well as my MacBook Pro when it comes down to the wire. My compromise is working on the MacBook Pro while wearing cheapie tennis shoes, but I did get the MacBook for a steal.
Identifying your entitlement weaknesses can help you strike a balance between what you want and what’s logical to purchase. What products do you feel entitled to and how are you curbing your expenses in those areas?