Overcoming Spendthrift Habits 1 - The Roots

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One of the toughest things for yuppies to learn includes the fine art of learning how to budget. Fresh out of college, a good number of middle-class yuppies have little to zero budgeting skills. We could point fingers towards a number of factors, but the bottom line is that we may have to face the music and come to terms with the fact that we, the guilty, have to unlearn these spendthrift ways.

Before we go on to the solution, we'll take the time to enumerate the causes of the problem first. While we don't want to dwell on what's wrong, as they say, "Knowing is half the battle." So when we understand the roots of our behavior, we can find the remedies for it, or the strategies on how to retrain ourselves.

Here are some possible causes of why carefree teens grow up to be spendthrift young adults:

1. For the middle class to the privileged, the daily (weekly or monthly) allowance gives an illusion of financial security. For the impulsive personalities, this illusion is a cue to spend until the last peso.
2. "Relative Deprivation" ruins the growing adolescent. Ever wonder why the well-to-do have more issues with "deprivation"-induced greed? Blame it on the media, blame it on the milieu of "keeping up with the Joneses," or blame it on high school social stratification. Either way, the green-eyed-monster isn't a great pet to have. Feeling like one doesn't have enough isn't necessarily based on reality or facts. One only has to have issues of envy and one may already acquire an issue of becoming a spendthrift induced by relative deprivation.
3. Lack of incentive to make ends meet. Has the person been "enabled" for most of her life? If all her needs --and wants-- have been given her, then the incentive to create and stick to a budget may be nowhere in sight. When the spoiled brat hits her twenties, crisis may ensue because the skill of making sure her budget reaches the next pay period is yet to be cemented in place.

These three points are, by no means, a comprehensive list of what creates a spendthrift personality. Think about how you developed bad money habits. What specific incidents led you to be as carefree with money as you are today? How do you suppose you could unlearn these?

Our suggestions on how to overcome being a spendthrift are in the next installment of this series, "Overcoming Spendthrift Habits."