Money Beliefs that Hurt Your Finances

by Jamie Simmerman · 10 comments

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?

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{ read the comments below or add one }

  • Lea says:

    I always try to identify the reason why I’m buying something. It has increased my savings and decrease the quantity of useless stuff around my house.

  • Jerry says:

    Entitlement leads to all kinds of problems not just a lack of money. I found many young people who refused to get entry level jobs because they thought the work was beneath them. I think your insurance for success in life is to work smart and work hard and note expect a handout.

  • Jean says:

    It is never a good idea to make purchases when emotionally stressed out. People may say shopping is a stress reliever but you rarely make good decisions when doing that. I personally am not masterful at self control when tempted to buy something but I try my best to atleast get things that are truly worth the money to me.


  • Shannon Black says:

    Do not anticipate. just follow where the market is going. U will make your money. I find myself saving the extra condiments I get from my fast food orders and I have cut back on driving to save gas.I agree I absolutely love forex factory and spend lots of time there. I did not include that here because that is a forum and not a blog. But that is a resource that all traders should spend time there.

  • Long says:

    When I bought a house, I felt entitled to buy in a very nice area. This was primarily born out of the fact that I grew up very poor. My first home was literally a tin shack that was hand built to the side of a detached garage. Because I worked hard to get to where I am today, I felt that I deserved a nice home.

    Truth be told, I could have been perfectly fine in a less upscale neighborhood and could be saving gobs of money on the mortgage every month. Now that I think about it, emotions really did spark the home purchase.

    In other arenas, I do feel that certain products are higher quality and will last longer. I recently bought some All-Clad cookware that I believe will last the rest of my life (the cheapy ones I bought on sale when I first purchased my house are already falling apart less than 2 years after I bought them). I try to save money by shopping around and waiting at least a couple days before I pull the trigger.

  • Marbella says:

    The desire to have the latest electronic stuff or larger car-house – boat, etc. has proven to be one of the reasons why the U.S. and Europe are in this economic crisis that we have put ourselves in. We must conserve the personal finances and does not pre-purchase them.

  • Financial Samurai says:

    Feeling entitled certainly does hurt. It’s when C-students think they deserve A-lifestyles that blow themselves up!


  • Monroe on a Budget says:

    I ditto the Mac Book Pro while wearing cheap sneakers!

    On a serious note, while we’ve decided we deserve better than mismatched furniture, we are not beyond hand-me-downs or seconds. Some of the pieces we have are second hand or more than 20 years old, but we’re quite happy with them. The furniture purchases we made in more recent years were to fill in specific gaps rather than fill an entire room.

  • The Ten Bob Millionaire says:

    Thankfully I’ve gotten a lot more frugal since last summer when I finally took control of my finances. When it came to spending prior to that I could have probably checked “All of the above” when it came to the reason I was doing it. I am much happier now that I’m living a more frugal life, but I will admit I’ll allow myself to splurge on the next iPhone later this year!

  • Chuck says:

    I will say I have become more frugal as I have gotten older. I find myself saving the extra condiments I get from my fast food orders and I have cut back on driving to save gas. I do upgrade my iphone every two years and play the best golf balls though.

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