Do we all judge a book by its cover? A story about financial health!
by Julie Lord
 

You know what’s worse than judging a book by its cover?

Judging a book by its cover… AND THEN making financial decisions based on what you guess the book might tell you. 

And yet, we do this all the time.

Not with books, but with people.

Look at the photo.

Not only are we judging that guy for the vehicle he’s driving (#NiceRangeRover, Bro)… we’re also likely to spend more on our own car just to keep up with him.

The question is... WHY? Why. Do. We. Do. That? Seriously... why?

The reason we do this—from the judging to the spending—is because we tell ourselves stories, and then we believe them.

Let’s consider the gentleman in the shiny Range Rover, for example. People often tell themselves the following stories:

1- Because he’s in it, he bought it (appearances = spending).

2- Because he bought it, he’s rich (spending = net worth).

3- Because he’s rich, he’s happy (net worth = happiness).

Let’s call that story what it is: a house of cards. Layer upon layer of assumptions that have no basis in reality. Of course we have no idea if that guy in the Range Rover bought it (maybe he’s the mechanic); even if he did buy it we don’t know his net worth (ever heard the expression "Fur coat, no knickers?”) and even if he’s filthy stinking rich, we all know that doesn’t mean he’s happy.

When we stop and think about it, of course it sounds ridiculous. And yet, these stories we tell are incredibly insidious. They sneak and slink into our thoughts on a daily basis. They fill our brains every time we size up another person.

The truth, though, is that we just don’t know. We don’t know anything about that guy in the Range Rover. Do you really want your spending to be dictated by the story you’re telling yourself about him, or indeed anyone else?

This post has been inspired by our friend Carl Richards who would agree that what’s really important is that you pursue your own passions in life. If you need any help making a plan to do that, do call us for a friendly chat.

If this article affects you or anyone you know, please feel free to contact Magenta on the number below for a friendly chat or visit their website at  http://magentafp.com/.

Julie Lord is CEO of Magenta Financial Planning. Julie is passionate about helping people to determine their life goals and then helping them to organise their finances most efficiently in order to achieve them. She believes in simple explanations of complex issues and long term client relationships.

Tel: 01656 760670

Magenta Financial Planning is Authorised and Regulated by the Financial Conduct Authority.