Tuesday, January 31, 2012

High Consumption Lifestyle: roadblock to wealth accumulation

In The Millionaire Next Door, it really struck out at me that a lot of relatively high income people end up in "asset poverty" i.e. poor, mostly due to their high consumption lifestyles. Apparently folks in the west care more about appearing affluent than to accumulate wealth over time, I believe it's partially due to influence from today's media.

The advertisement industry thrives because they "work". Regardless of the arguments around the help or harm, marketing campaigns ultimately aims to, and succeeds at moving target markets to consume gratuitously. There is the unfortunate reality that an overwhelming majority of the population is not capable of critical thinking, and would rather take instructions from a TV personnel.
We can all recall the myriad of sub-prime mortgage holders who had hit the fan just a few years ago.
Doctors who're really in a bit of debt (on average) from medical school, yet feel pressure to keep up an image of affluence and prestige.  

The western media likes to associate frugality with negative connotations, and now we know why. So when it comes down to it, it's all about being able to think for oneself and embracing reality.