Now that everything is getting more expensive and purchasing power is decreasing, it is becoming more and more important to take a look at your spending pattern. But economizing is not easy, because it goes against what your ancestors were taught: keep what you have.
The reason we save less quickly than is actually good for us has to do with the behavior that has developed through evolution. This is what Martijn van den Assem, a finance professor at the Free University of Amsterdam, specializes in human choice behaviors.
“We struggle to give up on something we already have. We seek short-term satisfaction and like to bury our heads in the sand when there is possible bad news,” he says.
According to Van den Assem, we as humanity have learned it in order to survive. “In the stone age, if you lose your ax or your food, you could kill yourself. We have an aversion to losing what you have because of that. And anyway the future was uncertain, so we had to take what was inside. and they were mostly engaged in short-term planning. “
“We give more weight to the present. We give in to temptation again and again ”.
Martijn van den Assem, professor of finance
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Taking a step back is annoying
The National Institute for Budget Information (Nibud) offers people all kinds of information practical advice save money. Yet we don’t always follow them. According to Van den Assem, this has to do with our behavior.
Take the tip to buy fewer A brands as an example. “People get satisfaction from buying an A brand. Sometimes the quality is better, but so is the prestige that such a purchase brings. I ever had, “says the professor.
More importantly, we pay too little attention to our future needs. We focus primarily on the now, says Van den Assem. “That’s why, despite good intentions, we find it so difficult to quit smoking, eat less or save enough for retirement. We give more weight to the present. We give in to temptation over and over.”
The brain is particularly bad at looking ahead, says consumer psychologist Patrick Wessels. “The brain subconsciously assumes that all the setbacks that exist now will not occur in the future. And that next week or next month we will have more time, more money and more energy than we have now.”
“It’s a form of overvaluation that comes from optimism,” he continues. “This is a good thing, because it allows us to take risks, make progress and embrace new ideas or activities. Unfortunately, it also means that financial planning is difficult for many people.”
The planner checks the agent
We behave like ostriches, says Van den Assem. “If we can prevent an unpleasant emotion, we will. It is very human. It is difficult to change the behavior that is in our DNA. But unlike animals, we are also born with the ability to think about our behavior. We can use that talent to our advantage “.
“Each of us has two selves fighting each other: the planner and the agent. The agent seeks short-term satisfaction. The planner thinks ahead and it’s the voice in your head that says, ‘Don’t doing it, it’s not good for you. ‘ That smart side is smart enough to hold back the unwise side. “
The fact that everything is now more expensive than before is finally an incentive for us to act, Wessels believes. “The brain doesn’t like to lose, so don’t lose even those extra dollars. That’s why even a relatively small increase can get people moving. Whenever someone goes shopping, has something to eat or drink, or does the shopping. , there remains a lot of media attention. This makes people alert, then more thrifty and then more uncertain or even more anxious about the financial future. This helps to keep the budget under control in the short term. “
