Upselling – Part 1 – Before the Counter

Most of the time, when it comes to shopping for clothes, I would much rather buy books – and at many times in my life, I have gone into the mall with the purpose of buying clothes and come out having purchased books. Or, if there is not a bookstore available, I will talk myself out of buying clothes so that I can go buy books some other place.  There appears to be some wiring defect in my head that, when I begin looking at the price of clothing I begin to think about how good an investment books are. In order for me to buy clothes, I almost have to know exactly what I am going to buy, walk in, grab it, go to the counter, pay and leave.  If I don’t do it this way, the voices in my head can become very active.

Well, recently, I finally decided, after a long debate in my head, that it was time to go buy some clothes.  Specifically, I was in the market for some t-shirts.  The majority of mine had served their purpose and had become fairly well worn out.

Not that you could tell by looking at me, but I am pretty picky about my clothing.  I don’t like wearing logos.  Most of the time, when it comes to shirts, I’m actually not a big fan of pockets.  And, yeah, I’m picky about t-shirts, too – high maintenance, right?  And being that I’m picky, once I find a piece of clothing that I like, I am quite apt to stick with that item for a long time – and then when I am forced to shop again, I frequently return to the specific product I have used before.  It’s suppose it’s a little bit like brand loyalty, but maybe not exactly.  Or maybe so…

Now, I knew going into this shopping expedition that I could get exactly what I was looking for online. But instead of taking the tried and true path, I decided to listen to the people in my inner circle about where I should go for my purchase, perhaps to expand my horizons a bit.  So, I go to a specific store because I have been given a good recommendation about the specific t-shirt in which I am interested. Now, based on past experience, I know when I walk into that store, a whole series of weird behaviors are apt to begin.

I walk in. I do a good job of finding the specific product I am interested in buying and go straight to it.  As I am walking, it is almost as if I can feel the dopamine rush, I breathe in deeply, my eyes widen and I begin thinking, “Ah, Jeez! there are SO MANY OPTIONS, $16.50 for a t-shirt, that’s at least one book, maybe two, this is going to be exhausting, ooh, that fabric feels nice – wow, I wonder if I can pull off the yellow or purple shirts — I’m pretty sure those will look awful on me – no, I just need black, gray and blue — but I need to broaden my tastes — I swear they’re pumping in oxygen — the colors are so vivid — the air is crisp — it is really bright in here –I really do need a v-neck and a crew neck –-I know this song they’re playing — is my heart beating faster?”

Now, when I came into the store I was fairly certain of what I wanted to accomplish and had a set amount of money that I was willing to spend on said product.  But I notice that as I am perusing the products, my limit has somehow moved to another location in my mind – and I begin bargaining with myself.  “I’ll grab a bunch of different colors and I can bring some back” and then, “I never go shopping, I haven’t had new clothes in two years, just buy what you want.” And then,  “I know I could get this cheaper, but I want quality for a change. I’m tired of cheap-ing out.” And of course, “I earned this!” or “I deserve this!” – both of those messages growing louder and louder as the primary messages rattlin’ around in my noggin.

I make my way to the counter with 7 different t-shirts in my hand…(to be continued)

The Tyranny of the Moment Video Post

You might have read my blog on this, but here is a video of me talking about the tyranny of the moment over a year ago!  Enjoy…

Holidays (Easter) Under Control

I have a seminar that I started delivering two years ago titled “Holidays Under Control.”  The reason why I developed this seminar was because when I was teaching my other programs, people would always start talking about how incredibly stressful the holiday season is and how much more money they spent during the holiday season than at other times of the year.

Well, when people talk about the holiday season, they usually mean from Thanksgiving until the New Year – and that is the time frame on which my seminar primarily focuses.  However, this last weekend, the Easter Bunny made his annual visit.  My wife and I felt compelled to make the basket and fill it with goodies – and our daughter actually expected the Easter Bunny to appear and bring her some goodies.  She didn’t have a list prepared like she did at Christmas, but she had expectations nonetheless.

So, while I don’t typically include the Easter holiday in my seminar, I thought I’d go ahead and look up some statistics on Easter spending in the U.S. According to Statistic Brain (http://www.statisticbrain.com/easter-statistics/), we dropped about $14.6 Billion on Easter this year, of course only $2.6 Billion of that was on candy.  Yeah, $2.6 Billion on candy (turns out that’s 120 million pounds of candy).

So I have three questions for you, my friend:

1. Do you feel compelled to spend money at Easter the same way you do during the fall/winter holidays?

2. Do you feel like there are a lot of expectations around spending during the Easter holiday?

3. Does Easter make the “stress” in your life go up at all?

 

Does Easter stress you out?

 

The Pain of Paying from Dan Ariely

Here’s a short video from Dan Ariely about how we spend differently depending upon the form of payment we use.  If you are not familiar with Mr. Ariely’s work, you should definitely check him out.

Misbelief

Opportunity Cost

Opportunity Cost is a fancy schmancy term that is usually used in economics classes and it usually is applied to how people use their money.  But I have found that the concept applies equally as well to how we utilize our time, and in fact many people actually grasp the concept better by applying it to time.

The opportunity costs of a particular action are the benefits you could have received by taking an alternative action.  As I mentioned, opportunity cost is usually discussed in terms of money, so here’s what it might look like in an econ book. Imagine that you invest in a stock yielding 3% over the year.  By investing money in the stock, you give up the opportunity to invest in something else like, for instance, a risk-free government bond with a 7% return.  In this example, the opportunity costs are 4% (7% – 3%), the difference in return between the forgone investment and the chosen investment.  Blah, blah, blah – insert lots of additional economics jargon.  What does that mean to you?  Well it means that every time you make a decision to use your time or money one way, you can no longer use it for something else.  The cost is what you spent on the item; the opportunity cost is what you could no longer purchase with those funds. And I know you might be thinking, “Duh! That’s so obvious.” But believe me when I tell you that people often don’t really think about it this way – especially in their day-to-day decision-making.

Now, as I said, opportunity costs are usually discussed in terms of money, but I think the concept can be applied to our time and energy as well.  For example, if I work an 8-hour workday, take 30 minutes for lunch, and commute 30 minutes each way, that adds up to a total time cost of 9.5 hours.  Since that window of time is devoted to and taken up by work, the opportunity cost of working therefore includes everything else I am unable to do during those 9.5 hours.  Spending time with my children, preparing and eating a meal with my family, exercising or recreating with my friends, and watching a favorite television show with a loved one are all examples of the opportunity costs of working.  In order to work, I must give up the time that might otherwise be spent doing and benefitting from something else.  In either case, a choice between two options must be made and the benefits I could have achieved by choosing the alternative option, whether monetary or otherwise, are the opportunity costs.

For some people, this concept has a huge impact on how they see their resources flowing out of their possession. But even if this isn’t a big “Aha” moment, this little concept of opportunity cost, the fact that we have to give up one thing for another can cause us to squirm a little.  Let’s say that I really want that pizza, but I know I’m going to need that $15 for childcare in two days.  But I really want that pizza!  But I know I’m going to need to pay the childcare!  There is conflict, and that conflict leads to some squirming.  And in that squirming we find ourselves dealing with a little problem we discussed earlier.  This is where you might notice that we have Internal Inconsistencies with our time as well as our money.  I might justify what I have to give up by rationalizing my choice, like, “I’m just too tired to cook tonight.” Or maybe some mental bookkeeping, like “I’ll just pay a little less on my credit card bill this month.”

Opportunity Cost is something that is happening every time you make a choice.  It is not something to be eliminated, but rather to be aware  of to help you in your decision-making process.

 

The Perception of Money

A key concept in Meaningful Consumerism and improving your financial health and  is to understand our perceptions of money and how money operates as a component of our financial health.  However, most people who I work with tell me that they don’t have any money, don’t have enough money, can’t save money, don’t know how to budget their money, and/or feel stressed about money.

So before we can really get any deeper into the discussion on financial health, I recommend that we should probably have a little bit better understanding of this term “money.”  So I’d like to ask you…What is Money?

In all my years of teaching, I have never met anyone who wouldn’t like to have more money.  In fact, the vast majority of my students view more money as the ONLY solution to their financial troubles – their golden ticket to being able to stick to a budget, save money for the future, improve their credit, reduce the amount of stress they experience in their daily lives, and to have a good life.  So, what is money?  When I pose this question to one of my classes, the responses I get are typically verbalized with vigor.  Money is power!  Money is status!  Money is opportunity!  Money is evil!  Money is freedom!  Money is worry!  It’s bad, no, it’s good.  It’s paper, it’s electronic.  It’s imaginary.  It’s government conspiracy.  It’s control. It turns out to be a lot of things.

Let’s use our imagination for a moment.  Imagine you had a hammer sitting on a table.  Does the hammer have any use just sitting there on the table, without a human to interact with it?  No.  The hammer can’t get up and start pounding nails into the wall on its own. All it can do is sit there on the table, patiently waiting for a human to pick it up and use it.  On its own, it has no use.  Sitting there on the table, the hammer merely represents the ability to do several things – some good, some not so good. It could put nails in walls, take nails out of walls, knock something loose that was stuck or push something into place.  On the other hand, it could also smash your thumb, knock a hole in a wall, make dents in things, or potentially seriously injure or even kill someone.  The hammer is simply a tool.  You get to determine how to use it and until it is being used it is neither inherently good nor bad.  It just is.

Money is really no different.  If left sitting in the wallet, it will do nothing.  If left sitting in the bank account, it will do nothing.  It might draw some interest, but until it is used, the interest will do nothing too. By itself, money doesn’t do anything, and it doesn’t do anything to us.  It does not move without us “willfully allowing” it to leave our possession, a behavior commonly referred to as spending.  In order for money to leave your possession, you have to willfully allow it to do so – always.

If you have a $10 bill in your pocket, it can represent many possibilities – but it is neither inherently good nor bad, it just is.  If you have $100,000 in the bank, it might mean a lot of different things to you, but until it is being used, it is neither inherently good nor bad, it just is. That $10 or $100,000 can be used to make purchases that will be beneficial, or it can be used to make purchases that are not beneficial. In the same way that you get to determine how to use a hammer or any other tool, you also get to determine how you will use your money.

So, as a reminder, money is simply a tool.  Money might come in many different forms, like paper, coins, or electronic information, but ultimately, it’s still just a tool and we get to decide how to use it.  All of those other things that we think about money, they are just reflections of what money represents to us.  And it is good to know that about ourselves as well.  But we will come back to this point over and over, money is a tool and it is a neutral object that we use.  Money does not use us.

 

Justifications

As mentioned in the last post, Internal consistency is restored and maintained through denial when we refuse to recognize or acknowledge that an inconsistency exists.  It is restored through justifications when we defend, excuse or uphold an inconsistent choice or behavior with a reason or explanation.

Justification, the more common of the two responses, comes in several different forms.  Here are some of the most common forms of justification:

1. Rationalization whereby our friends, our acquaintances, or we ourselves offer logical explanations to defend contradictory actions and beliefs in an attempt to restore internal consistency. An example would be, “I’m stressed, I need to blow off some steam so I’m going out tonight!”
2. Moral Licensing happens when we reward ourselves with something that is not in alignment with our values.  For example, “I worked out super hard at the gym today, so I’ll have two deserts.”  Or the other way around, “I’ll eat this cake now because I can work it off at the gym later.”
3. Social Proof is when you justify your behavior by telling yourself or others that it is okay because everyone else is doing it.  Basically, all holidays are evidence of social proof.  It’s also a favorite of teenagers.
4. Arbitrary Resource Devaluation.“It was only…”  If you’ve ever uttered these words to describe a purchasing decision, you have participated in what I call Arbitrary Resource Devaluation . In this situation, an individual intentionally devalues the their resource, time, money or energy in order to make a behavior feel okay.  For example, with money, this can be used for small amounts, like, “yeah, it was only 50 cents.” Or we can do it with larger purchases through comparison, like, “Well it was only $200, but at the other store is was $250.”  If you are compulsively drawn to clearance events, you may be participating in ARD frequently.
5. Future Self –  Often we like to rely on our “future selves” to get us off the hook for today.  For instance, we might allow ourselves to make a purchase today, but tell ourselves that tomorrow or next week we will be more steadfast in our choices and besides, we get paid in a couple of weeks anyway – and I’ll probably get a bonus at work. Our future selves are almost always superhumans that do not have the same weaknesses that we are having today.
6. Mental bookkeeping–We frequently keep track of how we spend our money, time and energy in our head, which is a very dangerous way to manage our resources, but it is quite common.  So here’s what happens, again, using money as an example.  First, we attempt to manage our finances on the fly.  To do so, we often will move funds around in our heads, figuring out when out the next paycheck will arrive and how we can massage our finances to make everything work out.  While nothing has really changed outside of our heads, we feel better about our finances in our heads.  Now if this is just a way to manage finances, it will end there.  However, sometimes there is a second step where we will create all of this mental work in order to figure out how to squeeze and additional expense into the mix.  By figuring it all out in our head, it gives us the courage to move forward with our spending decisions.

These different types of justifications are things that everybody in our culture does.  I still do it all the time. The point of discussing them is not to say that you should try to get rid of them, or to say that they are bad.  But at the least, you can be aware of the fact that you are making a justification for the behavior.  The awareness alone can be very powerful.

So, what are some of your favorite justifications?

 

What’s Important to You about Your Resolution?

Personal values are the qualities, objects, ideals, customs, beliefs, philosophies, institutions, etc. that are important to an individual. They are considered subjective and vary from one individual to the next.  Family, genes, environment, experience, religion, and political affiliation are all things that can influence our personal values. Personal values begin to develop early in life and can change over time.  When we are young, we typically adopt those personal values held by our primary care givers and role models, such as parents, teachers, and coaches with little or no thought or investigation.  As we grow, we begin to challenge that initial set of personal values and actively develop new ones, more heavily influenced by our own thoughts, beliefs, perceptions, and experiences.  I often ask my students to think back to when they were 18 years old and about whether the qualities, objects, ideals, beliefs, etc. that were most important to them back then, are still just as important to them today.  Typically, they find that their personal values have shifted over time and that many of the things that were most important to them back then, while they may still hold some importance, are much less important to them now.  For example, many 18 year olds rank excitement, adventure, change and variety, freedom and friendships as being of great importance to them, yet by the time they reach their late 20s, early 30s, things like security, stability, commitment, and family have become bigger priorities.  Like age, poignant life events, such as the death of a loved one, can also significantly impact and alter our personal values.

Most of us have some idea about the kind of person we, or others, believe that we are. Frequently in class I hear people say, “I’m the kind of person who…” or “she’s thinks of me as the type that…” Rarely, however, have we formally sat down to think specifically about what our personal values are.  We are not fully aware of our personal values.  Since personal values guide our decisions and determine how we treat others and how others perceive us, defining them can offer great insight into the various factors that drive our behaviors.

When it comes to making an Intentional Change to your behavior, I believe that it is very important to see if that change lines up with your personal values.   A person is much more likely to stick to a course of behavior change if they believe that it is in alignment with the person they believe themselves to be and the things they believe are important to them.   For example, there was a woman I was working with who wanted to save money but felt that she couldn’t, she had tried on several occasions in the past to save money, but was never able to accomplish her goal.  But when she decided to save money so that she could visit her children, it became more focused and easier.  Instead of moving away from something, like telling herself that she couldn’t have that new shirt, she focused on what she was moving toward – visiting her children in New York.  This was in alignment with her value of “being a good parent.”

In fact, there is a ton of data that suggests trying to repress a behavior ( I’m not going to eat that candy bar!) frequently leads to the reverse of our intended result.  There’s even a term for it, called “Ironic Rebound.”

If you want to make a change in a behavior but it is not in alignment with your values, very often the change will not stick at all or it will be short-lived.  This is why I strongly encourage people to take a close look at their values before setting up a plan to make any changes.

Take a moment and think of what you believe are your top five personal values (for example, being a good parent, economic security, faith/spirituality, health, immediate family, friends, entertainment, etc…).  Really think this through, what are the things you believe are most important to you right now (not what you want others to believe about you)? Write them down. No one will look, be totally honest. And then ask yourself, how the change/resolution you want to make lines up with one of those values.

 

What is Financial Health?

In terms of looking at our personal consumption a little differently, we will be offering some slightly new definitions to some old terms, or even creating new definitions all together, so that we can approach these terms a bit more holistically.  The first term I’d like to go over is “Financial Health” because I want to move us away from the concept that our personal finances and consumer behaviors operate in isolation.

Investopedia defines Financial Health as: “A term used to describe the state of one’s personal financial situation. There are many dimensions to financial health, including the amount of savings you have, how much you are setting away for retirement and how much of your income you are spending on fixed or non-discretionary expenses.” You will note that “health” in this definition refers to one’s financial situation, and not to the soundness of one’s body or mind. And when I bring up financial health, in almost all contexts, this is what people think about.  I think it is a bit too siloed.

The World Health Organization, on the other hand, defines “Health” as: “A state of complete physical, mental and social well-being and not merely the absence of disease or infirmity.”   While in this definition, a person’s financial situation is, at best, implied, the World Health Organization does further elaborate on this concept in their explanation of Health Promotion.  Health Promotion is described as:  “The process of enabling people to increase control over, and to improve, their health. To reach a state of complete physical, mental and social well-being (their definition of health), an individual or group must be able to identify and to realize aspirations, to satisfy needs, and to change or cope with the environment. Health is, therefore, seen as a resource for everyday life, not the objective of living. Health is a positive concept emphasizing social and personal resources, as well as physical capacities. Therefore, health promotion is not just the responsibility of the health sector, but goes beyond healthy life-styles to well-being.”

Well now, that’s very interesting.  “Health is seen as a resource for everyday life…Health is a positive concept emphasizing social and personal resources, as well as physical capacities.”  Let’s break that down a bit, Health is “a concept emphasizing resources and capacities?”  Hmmm. That sounds a little bit like economics to me.  I like this definition as it would support what everyone I’ve ever discussed this concept with already knows – that is, health is an invaluable, intangible asset closely aligned with the ability of a person to maintain or grow economically.

So, that being said, I would like to offer the following definition.

Financial Health is:

The dynamic relationship of one’s financial and economic resources as they are applied to or impact the state of physical, mental and social well-being.

Your personal finances and all of your financial decisions impact so many other areas of your life and we want to begin to draw attention to these intersections.

What is Meaningful Consumerism?

Meaningful Consumerism is my dedication to helping people recognize that it is possible to survive and even thrive in our consumer driven culture and still have meaning and intention in their lives.  In fact, not only is it possible to have meaning and intention, but that we can actually find a deeper, perhaps even spiritual, understanding of ourselves by looking at our thoughts and actions as we exist inside of our consumer driven culture.

This blog will explore in-depth, through any medium that is beneficial, how we can begin to make changes in our lives that will lead us toward a meaningful consumerism that in turn will help us to lead more meaningful and healthy lives.

It’s funny, because when it comes to how we handle our time, money and energy it appears that everyone else knows how to use it and has things under control. But so many of the people I work with, when asked where they learned about how to navigate the use of their time, money and energy look at me like I’m an alien.  For some people, they may have learned a bit from their parents, some might have gotten a bit of help in school.  But for the most part, smart utilization of our most precious resources is often assumed to be an inherent human ability. And because it appears that everyone else knows what they are doing, most people are hesitant to admit or ask for help when they don’t feel like they understand.

That being said, here are some things we know that we will be working on:

1. People in our culture are stressed and that stress is causing a lot of health issues.

2. A lot of people are in significant debt and it is causing them to be extremely stressed.

3. A lot of people in our culture are unhealthy and stressed and it is very expensive and stressful to be unhealthy and stressed:)

4. Frequently, our consumer behaviors and our personal core values don’t align.  Often through habits, routines and/or a basic lack of awareness we allow our resources to leave our possession without intention or meaning.

Vicious Circle