Even an innocent thing such as the language one uses can cause a very huge difference between failure & success in sticking to your financial plan. Everyone starts a budget with some conviction may be by borrowing cash from a licensed money lender – Easy Credit Money Lender – https://easycredit.com.sg
; but later it tends to slip away. If you have at some point questioned yourself the reason as to why it is difficult to save money, you might be shocked to realize that the answer might not be obvious as most people think. Below are some little known but important causes of the interference in your budgeting endeavors.
1. The language that you use
It might appear strange, but if you only speak and think in a certain language can affect the manner in which you save. A behavioral economist by the name Keith Chen first pointed this out, as countries which speak some “futureless” languages stand higher chances to become better savers.
What we mean by futureless language is a language that has no past, present, & future tenses. For instance, in English, we put it “I am going to walk to the park” in order to indicate some event that will take place in the future; this is different from “I went to the park” and “I am at the park”.
In some languages like German, Mandarin, & Japanese, there is little distinction in time among the phrases. This appears to be a coincidence with our fact that those countries which use such languages seem to save more.
Theory has it that, once you fail to mentally differentiate the future like a “faraway place”, the saving concept starts feeling less abstract.
In case you are bilingual, you might attempt thinking of personal finance in some other, “futureless” dialect – which could steer you to save even more.
2. Lack of sleep
Lacking sleep might interfere with your saving ability. This is due to the simple fact that once you are deprived of sleep, the brain leans much toward making some riskier & more impulsive choices.
The section of the brain which predicts the positive outcomes (for instance winning a lottery, or clearing your loans) becomes much active. The section of your brain which assesses the negative outcomes becomes much subdued on the contrary. Due to this, risks which you did not plan for start appearing much attractive.
The other impact of being deprived of sleep is the loss of willpower. Failure to have some rest is going to make you have less mental stamina of resisting your impulses. Individuals tend to be driven much into temptation – like eating out instead of preparing dinner; or buying a few single serves rather than being patient for a mark-down on the family-size servings – once we’re tired.
The last effect that sleep deprivation affects your saving ability is the fact that it causes tardiness: in case you are late to wake up, you will in most cases require private means of transport (or hire a private cab) in order to get to work, instead of saving money by simply utilizing public means of transport.
3. You combine thrift with saving
This is among the most regular complaints: you cut down your transport costs, eat cheap & purchase only once there is a discount. Despite being thrifty your savings seem not to get any better. But why is this so?
The reason behind is a usual mental pitfall, where we combine savings with thrift. For instance: once you utilize a promo code in order to pay S$10 lesser for a Grab ride, at that point have you actually saved S$10?
The simple answer is no. This is supposed to count as savings only when you take that S$10 to a different bank account. Otherwise, you are only getting much stuff for your cash.
This is similar with sales. In case you purchase a product for S$30 which is worth S$50, you actually have not “saved” S$20. What actually you have done is spending S$30.
Thrift helps in cutting costs, & it is prepares you to save – but it isn’t really saving till the point when you put it in your bank account.
4. You often dress down
It is not a good stereotype: anyone who dresses in shorts & singlets, with stains on their clothes, is taken to be a little bit worse with cash as compared to a sharp and a well-dressed businessperson in a suit.
However sometimes, there is some truth in this stereotype. Research has it that dressing good is going to boost your confidence as well as your self-esteem. Most importantly, the research indicates that once you are dressed like someone who is in charge then you enhance your skills of thinking.
What this means is that you are in a better position to predict the effect of the purchases that you make, & later weigh the prices in a reasonable manner. The possibility of falling for some slick marketing campaigns is less, & you are going to tap into cash which you wanted to save.
Therefore the next time you wish to make a major financial decision, move in appearing like someone who is competent & ready to make an important decision. That is supposed to get you in a “boss mode”, & you are going to be prone to spending.
5. Your insecurity feelings
Once you start feeling insecure about anything, or sometimes lack self-esteem, it is more likely that you will be driven into spending. Though psychologists have not yet succeeded to determine the main reason behind it, it narrows down to 2 possibilities:
The first reason is that you use the money to “buy” security. For instance, assume that you are stressed out due to your job performance, since your boss simply shouted at you. This can unexpectedly force you to use much money on food, to the extent that you end up overeating; this is due to the fact that your body’s survival instinct becomes triggered. The body tries to accumulate energy for the threatening crisis that your brain persists is currently happening.
The second reason is just a simple distraction. The process of purchasing new goods offers you some emotional “high”, therefore you forget all your worries. This mode of escaping is so much addictive, & you spend much on “retail therapy” in order to avoid facing your problems.
The secret is to discover another (free if possible) outlet, like swimming, painting, or even playing music. This is going to help you get out of the situation, having not to “spend” the problems away.