Is Plastic Making You Happier?

If you’re like most people, you probably own at least one.

And like most people, you’ve maybe never thought what it’s really costing you…

At a recent conference held by the Fabian Society at London’s Imperial college, one of the issues discussed was happiness, and, more specifically, why it seems to elude so many of us.

One of the conclusions reached was that one of the greatest causes of unhappiness in the last 50 years has been people’s constant desire to raise their level of material wealth (especially in relation to others who have more).

As one speaker noted, ‘We’re like children on a rainy Sunday afternoon, impossible to please. We have everything and nothing.’

You may disagree, but I can’t think of a worse modern symbol of this constant craving than the credit card.

Yes, I know, they might seem a godsend when payday isn’t for another week and a half. Having ‘free’ money can be a fantastic thing...if you manage to pay it back on time that is...

If you’re like a great many, though, and only managing to make that minimum monthly repayment, here are 4 things to think about the next time you reach for that piece of plastic…

1 It’s very expensive!

2% interest a month may sound like peanuts but that equates to 24% per year. Let’s imagine, like me, you lived in the UK, and had an average balance of £8000 on your card... that would mean you were paying £160 a month interest. On the national average salary, that’s almost a week’s work!

2 It’s not your money

You’re actually paying someone else for the privilege of making you poorer! That hard-earned cash should be in your pocket, not some lender’s. How can you remain solvent if you’re continually spending money you don’t have?

3 Money burns a hole in your pocket

If you’re like me, I can bet you’ve met or know loads of people who always seem to have too much month left at the end of the money. Yet, I’ll bet you if they earned double or even treble their income, they would still find some way to squander it. It seems to be in our nature somehow.

We’ve all seen those quiz shows where the contestants win big money. What’s the first question they’re asked? Yep, that’s right, ‘How are you going to spend it?’ I don’t recall many replying they would wisely invest it for their retirement.

4 You spend what you don’t have

Credit cards give you the illusion of being wealthy. Let’s face it, if you were handing over a 1000 dollars instead of that little piece of plastic, you might just stop and have a quick rethink.

It used to be the case that Gold cards (those ones with the massive spending limits) were the preserve of the wealthy, but the banks weren’t too long in realizing that if they gave these out to everyone, they would simply go ahead and spend as if they were wealthy. We seem to prefer illusion to reality, somehow.

Way back in the sixties, a French philosopher called Jean-Paul Sartre came up with a concept he called the Practico Inert.

Fancy terminology aside, he was trying to explain in a nutshell how humans almost always (and without realizing it) become prisoners of their own creations.

He used the example of Chinese peasants who needed wood in order to provide fuel and building materials for themselves. The long-term effect, though, was that the continual loss of trees needed for wood gradually exposed their land to flooding and drought.

Likewise, in our modern world, the credit card creates a short-term illusion of freedom and control, but in reality, only makes you poorer and increases your dependency on others.

So next time you’re tempted to reach for that piece of plastic, stop for a second and have a think about it’s true worth to you.

Is it really making you any happier, or like so many others, could it be seriously damaging your wealth?