Why people are irrational with money
I have covered this before in some form and will be tackling it again. The reason is because I have observed this irrationality again and again in a mmorpg game that I've been playing since November 2018. The game is called Ragnarok Mobile (It was released way back in the early 2000s) and now re-released for mobile smart phones.
This game has taught me a lot about the online world but also how we as humans carry-over our behavior and irrationality in a fictional game world.
In January 2019 the Auction House in Ragnarok M Eternal Love sold an auctioned item “Key of Heaven” for a whopping 3.2 million pesos or 360,000 BCC (Big Cat Coins)! During the last minute of the bidding, only 2 bidders from China and Indonesia were exchanging bids, while the players in the world chat were going crazy over the bidding. Some cheering for the bidders, while others are salty for the insane amount of money these bidders were spending.
A total sum of 831,101 BCC or PHP 7,367,916 for that period's auction (which also included other digital items) in Ragnarok M Eternal Love (SEA -South East Asian server).
Now for this February 2019 auction, another digital costume item was sold for 4.3 million pesos or 490,620 BCC. This week's auction ended with PHP 5,790,469 million of sales from the 10 other auctioned items.
The computation use to convert BCC to PHP is based from the best discounted price listed at pay.ragnaroketernallove.com. (PHP 5,000 = 564 BCC).
Crazy isn't it? I'm not saying that playing an online game and spending money on it is bad. It's your money that you worked for but do spend within your means.
This is why I always tell people as well as my former clients that the best strategy for personal finance in my opinion is understanding yourself through self-awareness. This may include asking yourself repeatedly why you want to buy or spend on something. For what? To what end? Are you living based on other people's opinions?
Another thing that I've learned is that our attitudes about spending or saving are often shaped by personal experiences. People who lived through the financial crisis, may see frugality and saving as a form of security and pass those lessons on to their own children and grandchildren. But when healthy saving progresses into hoarding, the reasons aren't always clear.
For some people, spending money simply isn't a source of pleasure, they prefer hiking or biking instead of going to the mall. For others, accumulating capital is like a game where the score is measured in the value of one's assets. These people derive a lot of enjoyment from watching their assets grow, and that's not necessarily a bad thing too.
People who are in debt need our understanding too since it doesn't matter what math or logic you show them, they cannot see your perspective because for them money is emotional and they are going to be set in their ways until they become self-aware of their faults themselves.
If you are on your journey towards whatever financial freedom, it's important to be patient and be kind with yourself. Rome wasn't built in a day, and anything worth doing takes time.
So if you fail, acknowledge it, make adjustments and try again and again.
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Vernon Joseph Go is an RFP®–Registered Financial Planner | Licensed Real Estate Broker | Content Creator | Podcast-on-the-go Producer & Host