Badass vs Dumbass
Master your Financial Kung Fu to be one and not the other.
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Go to Sifu’s Notebook for Doom Spending Unveiled
Primer: Who are Sifu & Ronin
Episode 38: Lunch Money x 10
Ronin: Sifu! I am depressed AF these days. The only news I read is bad news. Daily disasters everywhere. I don’t think my generation has a future – a good one anyways! And, global warming isn’t helping!
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Sifu: Dark thoughts, dude. It does sound pretty disheartening when you put it like that.
Ronin: I’m about done with killing myself to get ahead, when the future is so bleak. I’m headed to the mall, man. Gotta break up this negative fog in my brain and buy something cool for myself. It’ll make me forget this bullshit Matrix world we’re living in.
Doom Spending Explained
Sifu: So, you’re one of those young souls drowning in luxury to escape your doom?
Ronin: Escape? Please, Sifu. I’m sprinting! The world’s ending, inflation is soaring, and my feed is full of bad news. Buying stuff makes the apocalypse feel…softer, like cashmere.
Sifu: You are attempting to soothe a deeper fear with superficial splurges. Doom spending, Ronin, is a fatalistic response to uncertain times. You buy because you feel there’s no point in saving.
The Unhealthy Cycle
Sifu: Doom spending may feel good now, but it creates an unhealthy cycle. Every luxury purchase depletes your savings and deepens your anxiety.
Ronin: Ai-ya!
Sifu: Each swipe of the credit card adds to your stress, feeding the very thing you’re trying to escape.
What Are You Really Buying?
Sifu: Tell me, #1. What did you get recently to help you escape these feelings?
Ronin: This, my wise master – super bad timepiece. Sweet, no?
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Sifu: Oy! That watch, like some of your designer clothes and expensive vacations, offers only temporary satisfaction. These are things that give you nothing lasting.
Ronin: Lasting? Who needs lasting when I can look fabulous for five minutes, even longer if you don’t stare at it?
Sifu: Holy dumbass.
Consequences of Doom Spending
Sifu: And what of your savings, Ronin?
Ronin: Savings? Hmmm….
Sifu: With depleted savings, you’ll be vulnerable. Increased debt and financial instability are the direct results of this doom spending. Never mind what happens to your FIRE goals – they’ll be obliterated thanks to doom spending.
Ronin: Doh! Forgot about my big goals for a moment, didn’t I? Guess that’s all it takes. Sheeeeeit! Man, I need to focus …
How to Avoid Doom Spending
Sifu: Ronin, it’s time to break the cycle. You know the drill – practice mindful spending. Before you buy, ask yourself, ‘Is this a necessity or an emotional response?’
Ronin: Hmm, let me see. Emotional response. Emotional response. Oh look, another emotional response! Is there an app for this?
Sifu: Listen up Junior Jester. Budgeting will help you control these impulses. Set financial goals, and focus on your future. Emotional support from friends, not shopping bags, will truly ease your stress.
Ronin: So, no more retail therapy, huh? I should know these rules backwards and forwards after our lessons together. It’s just hard sometimes, boss.
Sifu: Padawan, a rich life is rarely easy. You get out what you put in – remember that.
Long-Term Happiness
Sifu: Remember also #1, happiness comes from security, not things you buy. By saving and focusing on long-term goals, you will find peace and stability. Maybe that peace will get you through these times.
Ronin: Roger that, bossman. Need to balance all the negative BS out there with my own positive living.
Sifu: Yes sir. You might also consider doing a little less doom scrolling. That can’t be helpful to anyone.
Ronin: Ok ok. I won’t waste my day reading bad news online and then spending my hard-earned dollars at the mall. But this stack of cash is burning a hole in my pants – lunch is on me, boss! You saved me again from doing stupid shit – you should be rewarded.
Sifu: Ha! You have today off. If you really want to pay me back, wash and detail my cars. I’ll pay you enough for your work so you’ll be able to afford 10 of those lunches. This is the road to FIRE.
Ronin: Always thinking ahead, boss, Done and done. But first, lunch! Sushi Bar Izakaya – we’re coming for ya!
Sifu’s Notebook
Doom Spending Unveiled
- What is Doom Spending?
Doom spending refers to the impulsive purchase of luxury goods and experiences as a way to cope with feelings of stress, anxiety, or hopelessness about the future. Instead of being thoughtful expenditures, these purchases are often made to soothe negative emotions in the short term. - Why is Doom Spending Happening?
Young people are constantly exposed to bad news, particularly regarding the economy. Rising inflation, job insecurity, and other global issues make them feel anxious about the future. According to Ylva Baeckström, a finance lecturer at King’s Business School, young people, who are “chronically online,” are bombarded with negative headlines, which makes them feel like “Armageddon” is near. As a result, they cope by spending money, often in a mindless way. - The Unhealthy Cycle
Doom spending is described as both “unhealthy and fatalistic” because it doesn’t address the root cause of anxiety. Instead, it exacerbates financial stress. The more someone spends, the worse they feel about their finances, leading to more impulsive spending in an unhealthy cycle. - What Are They Buying?
Doom spending typically involves splurging on:- Designer clothes and accessories
- Expensive vacations
- High-end electronics
- Trendy dining and beauty experiences
While these items provide short-term satisfaction, they offer little long-term value.
- The Economic Impact
A survey by Intuit Credit Karma in November 2023 found that 96% of Americans are concerned about the economy, with over a quarter engaging in doom spending to cope with their financial stress. Young people, in particular, are neglecting saving in favor of instant gratification through luxury purchases. - Consequences of Doom Spending
The long-term impact of doom spending includes:- Depleted Savings: Less money is available for emergencies or future financial goals.
- Increased Debt: Many rely on credit cards, increasing their debt burden.
- Financial Instability: Prioritizing short-term pleasures leaves individuals vulnerable when unexpected expenses arise.
- How to Avoid Doom Spending
Strategies to break the cycle of doom spending include:- Mindful Spending: Pause before buying and consider if the item is a necessity or an emotional response.
- Budgeting: Create a budget to prioritize savings and essential expenses.
- Long-Term Goals: Focus on financial goals like home ownership or retirement.
- Seek Emotional Support: Talk to friends or professionals instead of using shopping as stress relief.
