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I’m a Saver
Having money makes me feel safe
Damaris Medina
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There was a psychological study done back in the ’60s by a researcher named Walter Mischel that looked at self-control in children. He sat a kid at a table with a cookie and told her that he had to leave the room. He said that she could eat the cookie while he was gone. But if she waited until he came back, she’d get an even bigger cookie.

All of the kids in the study tried to hold off on eating the cookie until Dr. Mischel returned. But many of them didn’t have the self-control to wait. And guess what? Those kids who waited ended up being more successful in life.

I’m pretty sure I would have been one of the kids who waited for the bigger cookie. I’ve always had a lot of self-control with spending money, even when I was little. I don’t go on shopping sprees when I come across money. Instead I put it right into my bank account and hold on to it until something more worthy or necessary comes along.

I’m thrifty, too—there is nothing wrong with shopping for sales! It’s not like I walk around like a bum with cheap things. I just know how to find bargains.

Afraid of Being Poor

When I grow up I want to be rich, which means the best thing for me to do right now is to save the little money I get. I’d much rather watch my cash grow than spend it on stuff that’s not going to seem important to me tomorrow. I always feel like I need to save my money because I never know when something more important is going to come along. I don’t want to be stuck and not have any money to back me up.

I was the poorest of the poor when I was younger, I mean dirt poor. There were days we were starving, with no food at all. Maybe a small package of oatmeal in the roach-infested cabinet, but that was it. When Mom got her food stamps, it was like a miracle. But sometimes the food only lasted for two days.

I’ve been in care since my mom died six years ago, and I still consider myself poor. Now, though, it’s because the money I get from foster care and working goes straight in the bank and I consider it off limits most of the time. I save because I don’t want to be dirt poor ever again. I want to be financially prepared in the future so I can avoid those desperate experiences of my childhood.

Is Saving an Obsession?

Sometimes, though, I wonder if I take things too far. When I notice that my money is going low, I feel like I have no power and it makes me feel very limited. You need money to get by in society today, especially if you’re a college student like I am. Although I have scholarships and grants to help cover my school expenses, I still have to take out thousands of dollars in loans every year to pay my tuition.

People often think my saving habits are strange; they can’t understand why I work so hard to save. Sometimes they make me feel like there’s something wrong with me. Why do I feel such a strong need to save my money when other people just spend, spend, spend? Where does that motivation to always have and save money come from?

I wanted to understand this habit better, so I interviewed Professor Eric Schoenberg, who teaches at the Columbia University Business School and studies the psychology of money. Schoenberg supported my feeling that saving money does provide a sense of safety and security, yet there could be other factors involved.

Thinking About the Future

According to Schoenberg, there are two main things that drive people to save money. One is called goal-directed saving, which is saving up money for a particular purpose: a house, a car, even an iPod.

image by YC-Art Dept

The other is called precautionary saving, which means that someone saves because they have concerns about being financially secure in the future. That’s the kind of saver I am. I’m not always saving up for something specific; I just want to make sure I have enough money for when I really need it.

Professor Schoenberg also believes some people save money because they feel social pressure to save—if they’ve seen their families and friends saving, they feel like they should be, too. It also means those who have not seen other people with the habit of saving may be less likely to become savers.

Self-control plays a role in our spending habits, too. Part of that, said Schoenberg, is genetic. But another part of it is life experience. He said kids who grow up poor or in foster care may have a harder time saving because it’s harder to imagine the future. If you’ve been separated from parents and other family or experienced a lot of difficulties, it’s hard to visualize things being better. You have less confidence that things will go according to your plan.

In that situation, it makes perfect sense, said Schoenberg, why people might live for the present and give in to temptation, not knowing when an opportunity will come again.

Remember the cookie experiment? It turns out that the kids from middle-class and wealthy families were able to resist eating the cookie longer than poor kids. Why? Schoenberg thinks it has something to do, again, with being able to visualize the future (having faith that you’ll be rewarded with a bigger cookie). It’s hard to plan and save for something that seems far away, like college, if some basic need isn’t being met, or if you’ve had bad experiences that make it hard to imagine a brighter future. So you live for the moment.

Imagining Something Different

According to everything Schoenberg said, I should have turned out to be a spender. But somehow, I didn’t. Sometimes it makes me feel like I should be spending like everyone else I know who went through hard times. But he said something else about life experience that helped explain why I hold onto my money.

He compared it to being the child of an alcoholic. Some children of alcoholics become alcoholics themselves, but others avoid alcohol altogether because they can visualize the consequences—they’ve seen bad things happen to their parents. It can work the same way with money: If you’ve seen the adults around you struggling to get by, or spending themselves into debt, you can visualize that happening to you and that makes you want to do something different. As Schoenberg said, “You know the negative experiences you want to avoid.”

Having money makes me feel safe. I want enough of it that I’ll be able to feel OK if I take my family out to eat. I want to be able to pay off my college debts. I know that being thrifty and cautious about how I spend money now is going to help me reach my goal to be rich.

To me, being rich doesn’t mean spending a ton. It means having enough money to live comfortably without having to worry about the future.

Changing Behavior

So is saving money a habit that could be developed over time? Schoenberg said if you’re a spender, developing the habit of saving involves making it a deep emotional experience. You have to first visualize a future the way you would like it to be. Then, you have to think realistically about how much money you’ll need to get there.

“You have to make people realize what the consequences of their actions could be,” he said. “I am convinced that forcing people to think about the possibilities is the single most effective technique to change behavior.”

As for me, Schoenberg said my obsession with saving is probably just fine. “From my view the average American is not saving enough money. And I think we are going to have a huge problem in society when people confront this fact.”

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(FCYU-2010-10-26)

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