Does the proverb “Penny wise, pound foolish” applies to you? Are you good in restraining yourself when it comes to spending trivial amounts of money? For example, being careful not to spend on those small daily items like your morning cup of coffee, the pastry to go with it, the pack of cigarettes, the snacks, etc.
If you answered “Yes” then you have mastered your small spending. However, you may yet to have a better control when it comes to spending the big bucks. It could be the monthly retail therapy you are addicted to where splurging on branded goods is a necessity. For others, they cannot live without the weekend entertainment to hang out with friends at nightclubs and have a nice time. What about those who love to go on expensive holidays overseas several times a year?
It is not difficult to find such a person. Someone with a weakness for something may easily fall into this description. For example, a guy who is passionate about cars may think nothing of spending lots of money on changing cars every few years and equipping his current vehicle with the best accessories that money can buy.
If you are a person who is “Penny wise, pound foolish,” you may get to save some money through small acts of saving money but then will blow away that savings by spending large amounts of money in other ways. You will find it difficult to reach your wealth target unless you re-examine yourself to find out what are your weaknesses. You should reflect on the questions “What motivates you to buy something?” Or “What motivates you to part with your money?”
The answer will vary person to person. It could be one or all of the following:
- You buy or spend to make yourself feel good
- Your friends recommend you to buy
- You want to belong or “fit in” to a certain group or class
- You like the product advertisements
Once you have found the answer, you may be able to clean up your act and become “Penny and pound wise” instead. I admit that I am a “Penny wise” kind of person. I have been “Pound foolish” a few times in my life which happened when I rushed to spend money without taking time to analyze my options and the impact on my finances. So next time, no more rushing for me.