Does a poverty mentality prevent you from enjoying your money?

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By Sabrina Almeida

Do you only buy items that are deeply discounted? Or make purchasing decisions based on whether they are needs or wants? You might be a victim of the poverty mentality… and you’re not alone. Many individuals and families are held hostage by it. Which means they would rarely, if at all, go out and spend on a whim!

I too am guilty of exhibiting this behaviour on many occasions. I guess I haven’t got passed those “pocket money” days.

I use the term poverty mentality loosely to mean acting like resources are limited when they aren’t. (Not the victimization or hate-the-rich philosophy it also encompasses.)

Studies suggest that with family and financial background playing a huge role in determining your money management or spending habits, this trait is mostly learned. While exceptions exist, most of us mimic one or both parents. If you have been taught to live frugally, you are likely to struggle with the poverty mentality irrespective of how much money you have.

This attitude is not limited to South Asians (though we are mainly seen as bargain and discount shoppers) but immigrants in general. The challenge of making it in a new country and any initial financial struggles might continue to influence our lifestyles and spending habits even decades later. Shaking it off takes concerted and conscious effort which is hard to sustain.

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For instance, a 75-year-old Austrian immigrant who grew up during WWII and still has a pantry full of essential food supplies and water just in-case, exemplifies this.

As does another gentleman of Indian origin who always worked overtime to earn “extra” money for a vacation even though he had a reasonably large safety net. Having built a business from scratch in the home country, he made every penny count. Unfortunately, he succumbed to cancer in his late forties and never enjoyed his wealth, but his children will. His wife took it upon herself to continue his legacy. She lived even more frugally and invested all that she could. Her failing health prevents her from leaving her home now. Friends hated that the couple cried poverty when they were abundantly blessed and now feel sorry that they never enjoyed what they worked so hard to build.

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My neighbour shared a similar story about his cousin who immigrated from Portugal more than 40 years ago. He never purchased a new car or went on vacation, preferring to save all his money instead. Cancer ended his life early too and now his kids are enjoying the money he accumulated. My neighbour was the of the opinion that indulging himself might have improved his cousin’s quality of life, even prolonged it.

I’ve also come across more than a few young people who refuse to shop with their parents because they only visit the clearance section in any store. Any purchase must be fully justified if not by need, then mostly definitely a low price.

While this doesn’t decry the importance of saving for a rainy day or being a smart shopper, frugality can take on extreme proportions for individuals that are struggling with the poverty mentality. This can have serious consequences on their physical and mental health. They may opt to cash in their vacation time rather than take a break which often leads to both physical and mental fatigue. Looking for the best bargain and justifying every purchase can also cause stress and anxiety. As one expert pointed out, it involves expending your energy in a less than positive way.

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So should we abandon caution and spend without thinking? No, but we must recognize and acknowledge the emotions that cause it—fear and insecurity. Some behavioural psychologists suggest that neither is poverty the absence of money and things nor is prosperity an abundance of it. They are mindsets.

Changing the programming involves introspection and honesty. It takes getting out of one’s comfort zone, closely examining our belief system and facing our fears. This holds true for everything not just spending or hoarding money!

Life is short so why not enjoy it when you have the means to!

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