Today we are going to be talking about the psychology of money…specifically the psychology of social comparison and money.

But first off…I just want to acknowledge that I completely realize that even just talking about money makes a lot of people uncomfortable.  And I get it.  Money is everywhere and it affects all of us and confuses most of us.  In future episodes I’ll share my own gigantic mistakes with money…let’s just call them life lessons.

But I’ve found in my own personal work around the psychology of money, that if we get super cringy even talking about it…we will repel it. 

Fights about money is the 2nd leading cause of divorce in America?  So digging into the psychology behind our spending and our bank accounts is important…not just for your own happiness but also your relationships.

So to kickstart this mini money chit-chat, have any of you watched that HGTV show called “My Lottery Dream Home?”  It’s this show where host David Bromstad takes new lottery winners shopping for their new homes.  I find it fascinating how someone who won a $4 million jackpot ends up buying a house for $350,000 and then you have someone else who won $500,000 buying a house for $400,000.  

And here’s the thing: 

People all come from different generations

Raised by different parents who earned different incomes and held different values, in different parts of the world, born into different economies…

You get it…we all have been programmed differently and educated differently about money.

So I love the quote from Morgan Housal, who wrote an amazing book called “The Psychology of Money ” where he says “People do some crazy things with money.  But no one is crazy.”   The stock broker who lost everything during the Great Depression experienced something the tech entrepreneur in Silicon Valley basking in the glory of the late 1990’s cannot imagine.  

Basically we all have different experiences and beliefs around money…and oftentimes those are stored in your subconscious…so you don’t even freakin’ realize how you feel and why you feel that way!    

So going back to lottery winners…

Why is it that 70% of lottery winners end up broke within 3-5 years?  

And get this…60% of NBA players go bankrupt within 5 years of retiring.

78% of NFL players go bankrupt within 5 years of retiring.

So why is this?  Well it could be for a lot of reasons right?  Divorce, mismanaged investments,…you name it. But in nearly every study I found, the concept of social comparison always played a role.  

And what is social comparison?  Well, keeping up with the Joneses right?  It’s looking at what cars your neighbors and your friends are driving.  Where did Mark and Karen go on vacation this time and what fancy hotel did they stay at?  

For many women today, it’s looking on Instagram and comparing your shoe closet to the influencer casually showing her shoe closet and she has like 50 pairs of golden goose sneakers.  

And comparison can absolutely infect us like a disease if we’re not careful.  And if we allow it to spread, we might find ourselves spending money on material things that do not make financial sense…and we won’t be any happier because of it.

Just because the chick on Instagram has 50 golden goose sneakers doesn’t mean she’s super happy and fulfilled pooping out rainbows and unicorns.

So in today’s mini money chat, I hope you found it helpful to just shine a light on where you might have some comparison stuff creeping into your own life?  

Are you allowing yourself to feel less than or not as good as someone else, simply because of the image they project?  The shoes they wear or the car they drive?  

We gotta remember that sometimes that stuff is like lipstick on a pig.  

61 percent of the wealthiest people in the United States actually drive a Honda, Toyota, or a Ford.  

And I’m not saying “you shouldn’t buy nice things!”  Um, no.  I love nice things.  

So this is just a little reminder to forget about the game everyone else is playing…focus on your game.  How you want to contribute to the world and what you want your own life to look and feel like… and if that includes a pair of grubby looking tennis shoes with stars on them…then you go girl.  Just make sure you’re doing it for you…not because strangers on the gram say you need them in your life.

Dare to decide to make buying decisions less about the ego and keeping up with the joneses…and more about what is right for us personally!

The less we pay attention to what others are doing, the more confidence and momentum we create in our lives…and that’s where you’re going to thrive.

I’ll see you next time!

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