Time for a round of Answer the Reader’s Question: Ignorance vs. Bliss.
Today’s question comes from a reader in his twenties who says:
“I was wondering if you have ever written an article on converting the (financial) ‘non-believers’?
“I’ve been trying to get my girlfriend to … help us be financially free, but I am having trouble getting her to participate. I know she’s scared to read personal finance blogs and make a budget because she doesn’t want to know how much she wastes every month. She’s in denial.
“I’ve encountered this apprehension with many people in my life. I’m sure it’s a psychological defense mechanism, the ignorance is bliss syndrome. Do you have any tips on inspiring these kind of people?”
Here’s my reply:
Success unfolds when we face the brutal facts about our situation, no matter how dire, while simultaneously having faith that we’ll achieve our goals in the end.
I didn’t make that up. That idea is called the Stockdale Paradox, and it’s named after Admiral Jim Stockdale, a Vietnam prisoner-of-war who helped his soldiers face the brutal reality that they wouldn’t escape their imprisonment for a long time … while simultaneously trusting in their eventual freedom.
So how do you encourage someone in denial to “face the brutal facts?”
A lot of people are turned off by the notion of skimping and saving, but they LOVE the idea of quitting their lousy job.
I’d probably approach the topic with your girlfriend by showing her how passive income can allow her to buy the things she loves. She gets to continue living her lifestyle — AND doesn’t need to work in order to support it!
That should get her attention. Once you’ve piqued her interest, show her how setting aside some money now will create passive income streams for the rest of her life.
This post shows how I created $4,400 per year in passive income from just one of my several rental units. Meanwhile, the guy who lives in that unit, the guy who works hard to earn that rent money, drives a brand-new Mercedes-Benz. If I wanted a Benz, I could buy it purely from passive income in 8 years. (Of course, I could also re-invest that passive income and be one step closer to freedom …)
People are motivated by different factors. I’m motivated by freedom. So are plenty of the Afford Anything readers. Most of us want the autonomy to decide how to live our lives, without being pushed around by economic pressures.
But some people are motivated by material objects — houses, cars, clothes. That’s fine. Tap that motivation, and use it as the source that inspires you to waste less, invest more.
You can fritter money away mindlessly and then stress about the bills (ignorance), or you can retire at 40, travel to Bali and live in a mansion (bliss!). Sometimes it helps to start with the end in mind.
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Paula, good points on focusing on what motivates the person who won’t face the reality of their finances. Understanding “what” could happen if spending is out of control, there’s not enough money for retirement, or you don’t have enough money to pay for an emergencies can also be effective.
As a Christian financial coach I always focus on what the Bible says about money. Those principles are timeless whether someone is a Christian or not. However, they answer the “why” question for those who choose to live their life according to the Bible.
One last thought…a coach is sometimes helpful when couples can’t get on the same page about money. Perhaps even a female coach could help here. I know free coaching can be found through Dave Ramsey or Crown.org.
@Jason — One of my favorite money principals, a principal that I learned by reading Christian blogs (although I think this principal is universal, no matter what your religion), is the notion that none of our possessions are “really” ours. Everything belongs to a higher power, and we’re just temporarily stewards of it during our short time on earth.
I love that notion, because it’s a reminder of how fleeting this all is, and how much we should appreciate every moment of it, be grateful for every detail.
That is hard situation. I think you either need to scare her to show how it is hurting or show her the benefits you will receive or both. Hopefully she comes around and at least considers her spending and lines it up with your long term plans.
I think Lance is right. Here is the tough truth: this is not an area susceptible to compromise. Either money gets spent one way or it gets spent the other. It can’t be spent twice. we all know the stats about divorce and that money is the most common factor other than infidelity.
I would go further than Lance and make it a terminal issue: my way or no way. It’s going to come to that in 7 years anyway (or 10) so why not have it out now before you lose those years?
I don’t think you can really “get” someone to do anything, although it can be very frustrating. (And difficult to deal when you’re sharing finances with someone who isn’t on the same page as you.) I like the idea of piquing her interest with passive income. If that doesn’t work, I’d probably consider separate finances if it were me. (Having been through the whole years-of-money-issues followed by a divorce thing.)
I’m not sure why you’re saying passive income doesn’t require work. I’d say you’ve been working very hard for your passive income. 🙂
Unfortunately, it seems some people never get it when it comes to handling money. My sister once dated a guy who didn’t keep track on his checkbook balance and bounced checks all the time. He wasn’t clear on the concept that a balance query did not mean he had that much money available to spend.
My sister spent days going through old bank statements, got his checkbook straightened out with an accurate balance, and even showed this guy how the checkbook balance and bank balance could be different. She might as well been trying to teach a brick to swim.
The motivation to manage needs to come from within. If it’s imposed from the outside, the imposer’s job is never done. If you take the financial reins in hand, chances are it will be yours forever.
Thomas Jefferson, for example, was brilliant when it came to things like writing the constitution, but his wife managed the money. After she died, Jefferson went into financial ruin.
BTW, I didn’t mean for the above to come across as a reason not to try motivating someone. It’s certainly worth a shot.
@DemosCat — “to teach a brick to swim” — that’s a beautiful analogy. I’m going to start using that. (I also like “to teach a cat calculus.”)
I didn’t know that about Thomas Jefferson, but his story makes a certain amount of sense. I’ve met a handful of people who are incredible big-picture visionaries. I don’t mean that that they simply sit on the couch dreaming up great ideas. I mean that they’re observent, they see where society is headed, they come up with a vision, and they excite the people around them to buy into that dream. But they’re not necessarily detail-oriented.
In that context, I can imagine that Thomas Jefferson (or someone like him) might be a brilliant visionary with no aptitude or interest in the daily drudgery of monitoring accounts.
As for passive income … setting it up, getting it established, is incredibly tough. But once the systems are in place, I should hopefully (knock on wood!) have passive checks rolling in ….
One of the things that has really helped me improve my life the last few years is not being ignorant. I have done what I can to learn about different things, about myself and build awareness to my situations. This awareness has helped me work out a plan to make things better. With finances, it is always good to be aware of what you are doing.
I certainly don’t subscribe to the “my way or the highway” idea in any part of a relationship. Until you can figure out a way to date yourself, there are always going to be two different people in a relationship and that means two different approaches to everything (from money to cleaning the toilet). A relationship can survive those differences be they big or small, as long as the people involved are willing to talk about the issue.
In this case, I wouldn’t start with trying to force the girlfriend into anything. I like finding what motivates her. And maybe it’s the relationship that does. I’d start by asking to have regular money conversations, reminding her that money is one of the main factors in all divorces/break ups, so being able to talk about it is key to keeping the relationship happy.
After that, both people need to learn to compromise, be open to change, and be willing to revisit subjects.
Well here is an update to this question. My girlfriend and I have since split up and gone our separate ways. Interestingly, as soon as we split up she decided to get her finances in order and created a budget. She asked me to help her set it up so that she wouldn’t be flat broke for the rest of her life. What had happened (and I think we are all victims of this sometimes) is that she felt like she was safe and didn’t need to budget her money. Once the relationship ended and that safety net was no longer there she wised up and tapped into reality. If I could do it all again I would have started going over financial responsibility with her from the get-go but 5 years ago I wasn’t much different than her when it came to money.
On another note, to fight the “ignorance is bliss syndrome” I save all of my receipts. I take them all out at the end of the month (I’m changing this to the end of each week) and type the purchases into my spreadsheet. I really hate the feeling of looking at an unnecessary purchase at the end of the month so I’m much more conscious of my spending.
Some people have to hit rock bottom with debt and finances until they see the light. I assume it’s kind of like any addiction or dangerous behavior. You can preach, kindly suggest, educate, etc, but until they are ready to hear it, sometimes you just have to sit back and be ready to help when they are ready to accept it.
You do attract what you put out there. When you are sour and negative then that is usually what leads back to you. But, your insurance for success in this life is to see what you want and cheerfully go for it. It’s amazingly simple but hard to put into practice.
You had some great points here. I try to show people that they need to be positive in order to achieve anything.
Pam