Personal Finance: Practice the Values you Preach, or Alienate your Followers
I happened across another personal finance blog article over the last few weeks that left me scratching my head and then doing some deep reflection.
I won’t mention specifics on who the blogger was to save him additional embarrassment (and to save you from ready misinformed personal finance advice), but if you read him, you’ll probably know who I am talking about.
This blogger bragged to his readers about buying a new car. According to him, he had paid his dues and gosh darn it, it was time to splurge a little because he deserved it!
Now, buying a new car can be excusable. The used car market has been ridiculously competitive since the Great Recession started – prices are inflated everywhere and from my personal experience – just about any decent fuel-efficient car manufactured in the last 5 years that has a clean title is gone within a day of it hitting Craigslist. BUT, if you’re guying to buy new, you have to do it the right way.
And if you’re a personal finance blogger who buys a new car and be transparent with his/her audience, you better REALLY do it the right way. And that means all of the following:
- Find a cheap, fuel-efficient model.
- Get just the base features (which are plenty generous these days).
- Time it right with discounts.
- Pay for the purchase with cash or 0% financing.
- Negotiate like your life depends on it, BEFORE you ever set foot in a dealership. And even more when you get there.
This personal finance blogger did none of this.
- He bought a not very efficient mid-sized car that is overpriced compared to perfectly legit alternatives.
- Every feature imaginable was added – moonroof, heated front seats, 360-watt stereo with subwoofer, rear camera – top trim level. Judging by the make and model and every luxury feature he listed, my estimate that it was priced to about $35K. Twice what a compact base model costs.
- No discounts.
- He financed even when he had the cash available to pay.
- He didn’t negotiate ahead of visiting dealerships (and when you choose every feature, the dealers know you’re a sucker who’s willing to pay top dollar).
Throughout the entire post and ensuing comments, he made weak point after weak point defending himself on why the purchase was justified and why he went about it the way he did.
But what was most interesting to me were the ensuing comments.
Probably about 25% of the readers were cheerleaders: “Congrats! You deserve to splurge every now and then! (and you just made it excusable for me to do the same, yay!)”
But the other 75% took a drastically different tone…
Personal Finance is All About Values
I’m not sure why the blogger highlighted the purchase to his audience. I think maybe it was to demonstrate transparency. Personal finance bloggers are humans too – and sometimes we do make mistakes when it comes to spending. And that’s fine. His honesty can be appreciated, I suppose, but he did ALL THE WRONG THINGS in making the purchase and then didn’t own up to his mistakes. So, at best, he was demonstrating his personal finance incompetency, in a transparent way.
At worst, he was demonstrating how poor purchase decisions are all justifiable – which is Cardinal sin #1 in personal finance. Accusations from readers of being a poor example to others followed.
I bring this up, not to pick on the guy (whose blog has actually been rated as one of the best personal finance blogs) – but rather, because it was interesting to watch the the psychology play out.
Why were his followers so angry?
After much deep thought, I determined the answer was this: values.
People want to connect with and follow those who share their values.
And personal finance related decisions reflect your values on:
- materialism and consumption
- the environment
- how you value family and friends
- how you spend your time
- effort and creativity
No matter how many dozens or hundreds of articles this blogger’s audience had read previously, in this one particular post – their values (and the values they THOUGHT they shared with him) were very different to his. And that is disheartening for a loyal follower.
If you support a politician because you respect their values, and then find out they had an affair, you’re going to be disappointed. Why? Values.
If you follow an athlete because you appreciate their work ethic and find out they’ve been using performance enhancing drugs, you’re going to be disappointed. Why? Values.
If you follow a chef who talks about the weight losing benefits of their diet plan, and you follow their plan because it gives you hope, and then you find out they recently received a top-secret liposuction treatment, you’re going to be disappointed. Why? You guessed it…
Personal finance is no different. And those acting as role models for others should practice what they preach.