Sunday, November 16, 2014

A Fool and his Money ...


I was told recently that more than 65% of people will be financially dependent on their children by the time they are into their late sixties. That means that statistically two out of every three people you know will fall into that category. A lack of financial planning and discipline being the chief cause of this outcome! I find this fact hard to believe, especially considering that almost all the people I know are either financially savvy or extremely conservative in their money management practices. But then maybe that is not a representative sample of the entire population.

And then I connected the above fact to an advert that is being frequently aired on the radio recently, and feel a little less sure. The first couple of times I heard it, I shook my head and wondered who could ever believe that advertisement. It is by (obviously) a Bank and in the ad a son calls his mother up and tells her in an excited breathless voice that he has got a huge bonus. His mother asks him whether it is from his employer and how many months of salary it equates to - to which he replies that it is 20 months of salary and it is not from his employer, but from his Bank.

This begs the question as to whether this reputed financial institution actually expects any one to believe this advert? And if not, then why run such an obviously spurious ad campaign? Putting two and two together I realize that there must be a huge number of people who fall prey to this sort of manipulation of the truth. I could imagine a long snaking queue of people lining up to get their free money, signing a multitude of forms without understanding what they are committing to and then living a life in debt. I am sure that there must be people who are suckered into these deals, just as there are others who get convinced to subscribe to every credit card offered to them.

And that brings me then, to the number of highly educated and sensible people around who have no financial wisdom and even worse, discipline. They are experts in their various fields and can be quite expressive and knowledgeable about politics, technology and a wide array of  other disciplines. But when it comes to basic financial management, it seems common sense is not as common as is made out to be. It could also be that for a lot of people - money and money talk can be quite embarrassing.

Investments, financial planning, insurance - try and bring these up in a social context and people’s eyes glaze over. Their discomfort is apparent, as they fidget from foot to foot, trying hard to extricate their way out of that conversation. Money and money matters are often taboo topics even amongst couples and families. Money itself is an extremely fractious element, with most people having been brainwashed from very early on, into a "money is bad" mindset. And money talk can be perceived as quite distasteful – with two common approaches used. Some people can make one feel quite cheap and shallow to talk about money, and then there are others who adopt a more spiritual approach - implicitly indicating that money is rather base and hence not important in the grand scheme of life. They will spout homilies and hogwash like - 'money cannot buy you happiness' and 'money is the root of all evil'.

Of course the same people will have no compunctions in using this vile and dirty element for their existence and consumption.
 
This dichotomy between the external projection of disdain for money and the internal desire for its value, creates a divide that is then exploited by Financial Institutions. How many times have you (in a social setting) heard passionate arguments on the merits (or lack of) of a movie, an artist or a cuisine and how many on the virtues or pitfalls of financial planning? 
 
All I ask is the chance to prove that money can't make me happy - Spike Milligan