Six Lies We Tell Ourselves About Our Spending

NEW YORK (MarketWatch) -- Self-deception and a lack of control are the chief reasons for many poor spending decisions, and whiny explanations about wasteful purchases are nothing more than excuses for bad spending behavior.

If you are an impulse shopper who simply can't stop throwing money around, recognizing some of the common lies people tell themselves to justify their spending could help you rein in your urges, says syndicated personal finance columnist Gregory Karp. In his new book "Living Rich by Spending Smart," he lists six clichés that freewheeling spenders treat as mantras:

I could die tomorrow, so I'll live for today.
This immature attitude justifies actions of the buy-it-now and pay-for-it-whenever class. It's the primary excuse for not saving money.

I work hard, I deserve it.
This is akin to a four-year-old throwing a tantrum in a toy store crying "Gimme, gimme." While it is true that many Americans are overworked and that you have to treat yourself occasionally, self-gifting is more prominent today because of advertising pitches to buy things "because you deserve them." You also deserve to live out a retirement that doesn't include regular helpings of Alpo.

I don't have a head for numbers.
This is the excuse given for not paying attention to personal finances. But managing money doesn't require complicated mathematics. Consumers now have a plethora of free online tools to help with all sorts of financial planning. Be happy to do smart things with your money, if they aren't the absolute best you can do. Often, the absolute best involves more risk than you should be taking.

I'm too busy to compare prices or manage money.
This might be true for a small fraction of people, says Karp, but mostly it's a lie. Shutting off the TV one night a week will provide most people plenty of time to manage their finances. For those truly time-strapped, consider hiring a good financial adviser. It's more costly than managing your finances yourself, but better than doing nothing.

It's an investment.
Most consumer purchases aren't investments, because almost all of them plummet in value the moment you leave the store. So you don't "invest" in a car, a plasma TV or a new pair of shoes unless somehow they'll make you money. They are expenses. Pacifying your self-guilt by calling them an investment is self-delusion.

I don't earn enough to save money.
Saving is not about what you earn, it's about what you keep. If your paycheck truly covers only the cost of bare necessities, you have an income problem. It's time to work more hours or earn more with the hours you work.

By Marshall Loeb