More money, more problems?
Having too many choices to spend money on might be more challenging than we think.
Are too many choices, in fact, paralyzing? We often think that having more money can mean infinite freedom, but could having more money feel more challenging when connecting our buying decision with our personal values?
While participating in The Allowance Game at a Michigan State University Extension 4-H event, youth participants were asked to make choices in various categories such as food, savings and hobbies using a set number of beans (20) in the first round. In the second round, they were asked to make decisions using a more limited number of beans (12). Some participants commented that the limited choice option, having 12 beans instead of 20 beans, actually made it easier to hone in on their money values and the important behaviors and choices on which they felt it was most important to spend their “money.”
A recent National Public Radio presentation of the TED Radio Hour Talk looked at a similar topic that supports this anecdotal experience shared by some of the youth participants. The Decisions, Decisions, Decisions presentation included several decision-making experts sharing research and findings related to how we make choices.
According to Sheena Iyengar, professor of business at Columbia University, there is research that companies find an increase in sales with a decrease in choices offered, such as the number of jams or types of spaghetti sauce. Iyengar commented, “The value of the choice depends on our ability to perceive differences between options. When there are too many choices to compare or contrast, instead of making better choices, we become overwhelmed by choice.”
Having more money doesn’t necessarily make life easier or equate to happiness. It can mean more choices and, with some limitation of choices, we can focus on the needs more than the wants; a simpler process in the end. Helping young people explore their personal money values and the difference between needs and wants is a crucial part of developing that skill for future use.
MSU Extension and Michigan 4-H Youth Development help to prepare young people for successful futures. As a result of career exploration and workforce preparation activities, thousands of Michigan youth are better equipped to make important decisions about their professional future, ready to contribute to the workforce and able to take fiscal responsibility in their personal lives.
To learn about the positive impact of Michigan 4-H youth career preparation, money management and entrepreneurship programs, read the 2015 Impact Report: “Preparing Michigan Youth for Future Careers and Employment.”