Why Do We Make Bad Money Decisions?

If you’re ever up late at night and turn on the television, more often than not you’re going to see one of those get rich quick informercials. You know the ones I’m talking about – the “Buy our software and you’ll be able to pick all the best stocks, making thousands of dollars a month!” or “Buy our real estate system and you can own your own rental properties with little or no investment on your part!”.

All of these get rich quick schemes have one thing in common – they play upon your need to have material things. Money, cars, boats and a nice house. In a word, they play upon your greed.

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In an article over at Gather Little by Little today Jason Anderson talks about why sometimes otherwise very bright people make very bad decisions:

When you see a hapless grandma who’s just lost her pension check or a hard-working, blue-collar guy who’s blown his life savings, it may seem harsh to saddle them with some of the blame for their loss. But the hard truth is this: the characteristic that makes a person most susceptible to a con is not stupidity or gullibility, but greed. Smart people set themselves up for financial disaster when they start to believe they can get something for nothing.

Now, we’re all greedy to a degree, and not to sound too much like Gordon Gekko, but sometimes that’s okay. You can be greedy for the right things. If you’re greedy for more time with your kids or for a closer relationship with God, that might actually lead you to make better decisions. And a desire for more money doesn’t necessarily qualify as greed. Providing a better life for your family and getting yourself out of debt are noble goals. But there comes a point where a healthy desire to get ahead veers into oncoming traffic.

When we’re making decisions about our money, we always need to make sure that we’re checking ourselves, and making sure we’re doing things for the right reason. Are we jumping on board a money making venture because of greed – or because we actually think it is a good deal? Have we let ourselves be blinded by the lure of quick wealth?

One verse that sticks out for me in such situations is the following from Proverbs 13:11:

Dishonest money dwindles away, but he who gathers money little by little makes it grow.

Sometimes you can make money in a get rich quick scheme, but often money gained in such schemes is quickly lost. Finding a good job, and gaining ground “little by little” through hard work will always be more successful.

More good stuff at the link below, check it out!

LINKS:
Gather Little by Little – Path to bad decisions

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Last Edited: 28th February 2013

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  1. elizabeth says

    thats ok. you speak of the truth. am blessed by the verse you have given proverbs 13:11. and its explanation or how you have explained it. thanks and God bless u.

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