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The psychological poverty trap
FB was a bit compact for everything I wanted to say from this link.
I don't agree with all of it, especially not how it dismisses financial education. Although I would frame it in broader resource-allocation terms - as this article touches on with the comparison between money and time.
There's a saying "Don't put off until tomorrow what you can do today" - not that I live up to it any better than the next person but the parallel is that unexpected tasks can pop up analogously to unexpected expenses, and things can (always) take longer to do than expected in the same way that sometimes things cost more than budgeted. Of course we use time all the time and most of us only use money on an intermittent basis.
Aside - relaxing/taking time out is also a something you shouldn't put off to tomorrow - also something I'm particularly bad at.
The two most important points I think the article makes are about
1. the positive feedback loop of having a buffer.
- If you are somehow/somewhat insulated from the effects of a bad decision,
- you are then less stressed by the need to make the decision
- and more likely to make a better decision
- which will of course leave you in a better position to make the next decision
2. people are not to blame for being poor
- it may certainly be because they made a bad decision or series of bad decisions - but that's not a crime.
- it may equally well be due to circumstances outside their control
- either way now that they are poor the deck is stacked against them. If we as a society wish to alleviate their situation we need to stop demonising them and cut them a break
~~~
It also touches on the difficultly of actually making changes in your life, regardless of the time spent planning there is always this psychological hump to be overcome before taking action. I am very familiar with this hump, having failed to overcome it on many occasions :-/ The biggest changes in my life (and employment issues are uppermost in my mind at the moment) have always come from outside - when the hump suddenly becomes the edge of a cliff.
In some cases (looks at the "to do" item marked "health insurance" and the pile of research stacked underneath it) the cliff could mean it's too late.
FB was a bit compact for everything I wanted to say from this link.
I don't agree with all of it, especially not how it dismisses financial education. Although I would frame it in broader resource-allocation terms - as this article touches on with the comparison between money and time.
There's a saying "Don't put off until tomorrow what you can do today" - not that I live up to it any better than the next person but the parallel is that unexpected tasks can pop up analogously to unexpected expenses, and things can (always) take longer to do than expected in the same way that sometimes things cost more than budgeted. Of course we use time all the time and most of us only use money on an intermittent basis.
Aside - relaxing/taking time out is also a something you shouldn't put off to tomorrow - also something I'm particularly bad at.
The two most important points I think the article makes are about
1. the positive feedback loop of having a buffer.
- If you are somehow/somewhat insulated from the effects of a bad decision,
- you are then less stressed by the need to make the decision
- and more likely to make a better decision
- which will of course leave you in a better position to make the next decision
2. people are not to blame for being poor
- it may certainly be because they made a bad decision or series of bad decisions - but that's not a crime.
- it may equally well be due to circumstances outside their control
- either way now that they are poor the deck is stacked against them. If we as a society wish to alleviate their situation we need to stop demonising them and cut them a break
~~~
It also touches on the difficultly of actually making changes in your life, regardless of the time spent planning there is always this psychological hump to be overcome before taking action. I am very familiar with this hump, having failed to overcome it on many occasions :-/ The biggest changes in my life (and employment issues are uppermost in my mind at the moment) have always come from outside - when the hump suddenly becomes the edge of a cliff.
In some cases (looks at the "to do" item marked "health insurance" and the pile of research stacked underneath it) the cliff could mean it's too late.
