This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
And they hurt themselves in the process
Mishandling your financial resources is detrimental to your money unless you have enough coming in to offset your less healthy choices.
Not only does the mismanagement of money affect your future, but it affects your options and opportunities in the present.
What does this mean?
Most people don’t prioritize the best actions with their money, and it’s not always due to a lack of education but instead a misalignment in perspective.
The marshmallow experiment proved that most people would choose instant over delayed gratification.
Instant gratification feels good 100% of the time.
Delayed gratifications feel good 0% of the time.
Now we see why people don’t enjoy postponing purchases, saving and investing for a future date, and decreasing spending.
Why would we want to delay gratification when we can spend more liberally now versus dealing with the discomfort of financial self-discipline?
But the truth is, instant gratification numbs the pain of not making progress on your financial goals. You’re in pain and feel it shortly after every financially imprudent decision.
At some point, most of us have experienced the guilt of buying something that we should’ve put back.
Examples
New Car vs. Old Car
It’s easier to buy a brand-new car if you can afford the monthly payment instead of driving an older car that’s paid off or even finishing the payment plan of your current car.
What’s shiny, new, different, and better looking can appear as a more attractive option.
Paying Off Credit Cards vs. Running Up Credit Cards
When some max out a credit card, their first instinct is to open another.
Instead, a more proactive approach would be to pay off the maxed-out credit card and then rethink how you use credit cards so you can avoid maxing out credit cards in the future.
Investing vs. Spending
There is nothing wrong with spending money. But if you’re never keeping any of your money and allowing it to fly out the window, what good is that doing you now or in the future? Not much.
There is a delicate balance between spending and investing.
Living below your mean is the first step to setting yourself up to invest.
The second step is to determine how much money you need to invest.
The third step is to invest and stay consistent.
Buy A House or Rent
For some, it makes sense to rent because the upfront costs and regular maintenance costs will become too much of a burden.
Yet, some still leap and get the house even though they need to prepare financially.
If renting makes more sense to you, then rent.
There is no shame in renting – especially if you’re in a healthier position.
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.