Your brain wasn't designed for money (and it shows)

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Hey there, it's Ren here…

So last Tuesday, I did something monumentally stupid.

I bought a $4.50 latte (again), spent 20 minutes justifying it to myself, then went home and spent TWO HOURS researching vacuum cleaners to save $30.

Let that sink in for a second.

I agonized over a $30 purchase difference while throwing away $4.50 without a second thought. And here's the kicker - I do this ALL. THE. TIME.

Sound familiar? Yeah, I thought so.

Welcome to the absolutely bonkers world of your financial brain, where logic goes to die and emotions throw the party.

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Marjorie Taylor Greene: Up 134% on PLTR
Cleo Fields: Up 138% on IREN

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🧠 The Question:

Why Do Smart People Make Dumb Money Decisions?

Here's something that'll blow your mind: Your brain wasn't designed for managing money in 2025.

Nope. Not even close.

Your brain was designed for a time when:

• Resources were scarce (like, actually scarce - not "the grocery store is out of my favorite brand" scarce)

• Decisions needed to be fast (is that a berry or a bear?)

• The future meant "later today" not "30 years from now"

So when your brain sees a sale sign screaming "70% OFF!" it literally triggers the same neural pathways as finding food when you're starving.

No wonder we make terrible financial decisions sometimes!

💡 The Money Mind Traps (And How to Escape Them)

Let me introduce you to the sneaky psychological tricks your brain plays on you every single day. These aren't just interesting facts - understanding these could literally save you thousands of dollars.

Trap #1: The "Small Purchase" Illusion

Remember my coffee situation? This is what psychologists call "mental accounting" - we treat money differently depending on arbitrary categories we've created in our heads.

How It Shows Up:

• "It's only $5" (said 47 times this month = $235)

• Splurging on delivery fees while obsessing over grocery prices

• Buying premium everything at Target while clipping coupons elsewhere

• Not tracking subscriptions because "they're small"

The Real Cost: Sarah (a friend of mine) did an experiment. She tracked every purchase under $10 for one month.

Guess what? Those "small" purchases totaled $487. Nearly FIVE HUNDRED DOLLARS that she hadn't even registered as spending!

Your Action Plan: Here's the game-changer - use the "Latte Factor Calculator":

1. Pick your most frequent small purchase

2. Multiply by how often you buy it per week

3. Multiply by 52 weeks

4. Multiply by 10 years

5. Calculate what that money could be worth invested at 7% returns

That $5 coffee three times a week?

• Weekly: $15

• Yearly: $780

• 10 years: $7,800

• Invested at 7%: $10,764

I'm not saying never buy coffee (I'd be a massive hypocrite!). I'm saying be aware of what these choices actually mean.

Trap #2: The Anchoring Effect (Or: Why Sales Trick You)

Your brain uses the first number it sees as a reference point for everything that follows. Retailers know this. Oh boy, do they know this.

How It Shows Up:

• Seeing "$199 was $399" makes $199 seem like a steal

• Feeling good about a "discount" you weren't planning to use

• Buying something because it's "on sale" not because you need it

• Falling for "compare at" pricing

Real Talk Moment: Ever bought something just because the discount seemed too good to pass up? Then it sits in your closet with tags on?

That's not saving money. That's spending money you wouldn't have spent otherwise. (Yes, I'm talking to past me here too!)

Your Action Plan: The "Need It Now?" Test:

Before ANY purchase ask yourself:

1. Did I plan to buy this before seeing the sale?

2. Would I buy it at full price?

3. Will I use it in the next 30 days?

4. Do I have something similar already?

If you answer "no" to any of these, walk away. The "savings" aren't real.

Pro Tip: Take a photo of the item and come back in 24 hours. If you still want it, it might be worth it. If you forgot about it? You just saved yourself money AND buyer's remorse!

Trap #3: Present Bias (Future You is NOT Your Friend)

Your brain values NOW about 1,000 times more than it values LATER. This is why we:

• Eat the cake (screw Future Me's diet!)

• Skip the gym (Future Me can work out)

• Spend instead of save (Future Me can worry about retirement)

How It Destroys Your Finances:

• Credit card debt (I'll pay it off "later")

• No emergency fund (I'll start saving "next month")

• Undersaving for retirement (Future Me will figure it out)

• Living paycheck to paycheck when you earn decent money

The Brutal Truth: Every dollar you spend today is roughly $8-10 you WON'T have in retirement (assuming 30 years at 7% returns).

That $50 dinner? That's potentially $400-500 from Future You.

Now, I'm NOT saying live like a monk! Life needs to be lived. But what if we could trick our brains into caring about Future Us?

Your Action Plan: The "Future Self" Visualization:

1. Find an age progression app (there are free ones)

2. Upload your photo and age yourself to 65+

3. Save that photo as your phone wallpaper for a week

4. When tempted to make an impulse purchase, look at that photo

Research shows this ACTUALLY works. When people see their future selves, they save 30% more on average.

Why? Because your brain stops seeing Future You as a stranger and starts seeing them as... well, YOU.

Trap #4: Loss Aversion (Why We Hold Losing Investments)

Here's a wild fact: Losing $100 feels about twice as bad as gaining $100 feels good.

This is why we:

• Hold onto losing stocks hoping they'll "come back"

• Stay in bad subscriptions because we "already paid for the year"

• Keep clothes we never wear because "they were expensive"

• Don't cancel gym memberships we don't use

The Sunk Cost Fallacy: You know that subscription you're paying for but not using? Your brain says: "But I already paid! I can't quit now!"

Wrong. That money is GONE. The question isn't "what did I pay?" it's "what's this costing me going forward?"

Your Action Plan: The "Fresh Start Audit":

This weekend, pretend you're new to your own life:

1. List every subscription/membership

2. For each one ask: "If I didn't have this already, would I sign up for it TODAY?"

3. Cancel anything that's a "no"

Don't think about what you've already paid. That's gone. Focus on what you'll save going forward.

My hubby and I did this last month. We found:

• $47/month in subscriptions we forgot about

• $120/month in "I'll use it eventually" services

• $23/month in apps we downloaded once

That's $190/month = $2,280/year we were flushing down the drain!

Trap #5: The Endowment Effect (Why You Can't Declutter)

Once you own something, your brain values it way more than it's actually worth. This is why:

• Your stuff seems priceless when you're decluttering

• Other people's things seem overpriced when you're buying

• You keep things "just in case"

• Your garage/closet/storage unit is full of things worth "too much to throw away"

The Hidden Cost: All that stuff you're keeping? It's costing you:

• Mental energy (clutter = stress)

• Physical space (space = money)

• Opportunity cost (could sell it for actual money)

Your Action Plan: The "Stranger Test":

Pick any item you're keeping "because it was expensive."

Ask yourself: "If a stranger offered me what this is actually worth right now (not what I paid), would I take it?"

If yes, sell it or donate it. If no, why are you keeping it?

Reality Check: That expensive exercise equipment collecting dust? It's not an asset, it's a monument to a purchase mistake. Let it go.

🎯 Your Action Toolkit: Rewiring Your Money Brain

Okay, so now you know WHY your brain sabotages you. Let's talk about HOW to fix it.

Tactic #1: The "Breathing Room" Budget

Forget strict budgets that feel like financial prison. Instead, create breathing room:

The 60/20/20 Method:

• 60% for essentials (housing, food, utilities, transportation)

• 20% for financial goals (savings, investments, debt payoff)

• 20% for guilt-free spending (whatever you want, zero judgment)

Why this works: Your brain needs freedom to feel safe. When you know you have "fun money," you stop rebelling against your budget.

Tactic #2: Automate to Eliminate

You can't make bad decisions about money you never see:

1. Set up automatic transfers on payday:

   • Emergency fund first

   • Investment accounts second

   • Debt payments third

2. What's left is yours to spend

3. Review monthly, but don't obsess

Why this works: You remove the daily decision fatigue. Future You is taken care of automatically, so Present You can relax.

Tactic #3: The "Wait & See" Method

For any unplanned purchase over $50:

1. Add it to a "Maybe" list

2. Wait 7 days for every $100 it costs

3. If you still want it AND can afford it, buy it guilt-free

Why this works: Most impulse purchases lose their appeal within 48 hours. This system lets your rational brain catch up to your emotional brain.

Tactic #4: Pain & Pleasure Reframing

Our brains respond to emotion, not logic. So use emotion:

For Saving:

• Don't save for "retirement" (boring!)

• Save for "freedom" or "options" or "telling my boss to shove it money"

For Spending:

• Don't think "I can't afford it"

• Think "I'm choosing to spend my money on [goal] instead"

See the difference? Same action, totally different feeling.

Tactic #5: The Accountability Hack

Tell someone about your financial goals. Why?

• Makes them real

• Creates positive pressure

• Gives you someone to celebrate wins with

Hubby and I have a weekly "money date" (yes, we're that couple). Sunday mornings, coffee, 15 minutes talking money.

It sounds boring but it's honestly been game-changing. We catch problems early, celebrate wins, and stay aligned on goals.

💭 The Truth About Financial Psychology

Here's what I wish someone had told me years ago:

You're not broken.

Your brain is doing exactly what it evolved to do. The problem is we're using caveman brains in a modern financial world.

Understanding that isn't making excuses - it's the first step to working WITH your psychology instead of against it.

The secret isn't willpower (that's exhausting and fails eventually). The secret is systems that make good decisions automatic and bad decisions harder.

📊 This Week's Challenge

Pick ONE trap that resonates most with you. Just one.

Implement the action plan for that trap this week. Track what happens.

I'd love to hear which trap hit home for you! Hit reply and let me know - I read every single email (yes, really).

Next week, we'll dive into something equally mind-blowing: why your childhood might be controlling your adult finances (spoiler: probably more than you think).

💭 Final Thoughts

You know what's funny?

Once you understand these psychological tricks, you start seeing them EVERYWHERE. Marketing emails, store layouts, sale tactics - it's like taking the red pill in The Matrix.

And the best part? You get to choose whether they work on you or not.

That's power. That's freedom. That's what we're building here.

Remember: The goal isn't perfection. It's progress. It's awareness. It's making slightly better decisions more often.

That $4.50 latte I mentioned? I still buy it sometimes. But now it's a conscious choice, not an autopilot mistake. And that makes all the difference.

To your financial (and psychological) freedom,

Ren

P.S. - Seriously, tell me which trap got you. My money's on the small purchase illusion (because that's the one that gets me EVERY. SINGLE. TIME). Hit reply - let's commiserate together! 😊