The Difference Between Food and Money

From some spam I got yesterday:

Dear Amazon.com Customer,

As someone who has shown interest in books and magazines on cooking, you might like to know that you can get a $5.00 instant discount on SmartMoney this month.

Ice Cream Lotus Head

I’m not entirely sure what is going on here. It’s possible that it’s just a mail-merge typo, that the text "cooking" was accidentally put in where Amazon meant to write "finance and investing." I like eating as much as the next guy, but describing me as somebody "who has shown interest in books and magazines on cooking" is quite a reach. On the other hand, I do keep buying books about finance, so flogging SmartMoney to me makes some sense.

But there is another, less likely, explanation that I would rather was true. I would rather that the algorithms at Amazon that tell them that people who bought A might like to buy B have found that personal finance and cooking/nutrition/dieting are similar topics with similar audiences.

To be clear, I am not happy that the topics are so related in the minds of so many, but I think it is true that they are. On the subject of saving money and controlling spending in particular, it is hard to find a mainstream discussion that avoids the food and diet metaphor. It’s just so convenient to draw the analogy between saving and the familiar topic of dieting. Dave Ramsey’s semi-permanent bestseller Total Money Makeover sustains the saving-dieting analogy for the entire book.

On a superficial level, the similarities between how we deal with money and food are strong. Both involve willpower and delayed gratification. A diet is a lot like a budget.

But beneath the surface there are meaningful differences between getting rich and getting thin that can cause big problems if you take the money as food analogy too far.

(And do I need to point out how pathetic it is that saving is so unfamiliar and dieting so familiar to us that this analogy is helpful at all? Do weight loss books tell their readers it’s like saving money? Of course, I wouldn’t know….)

If you want to be successful at getting in shape physically, you need a long sustained campaign of eating less and exercising more. Eventual victory will come from many small triumphs over your urges to eat cookies and skip the gym. Occasional lapses, as long as they are truly occasional, will not ruin your campaign. Being virtuous almost all the time is enough.

But success in getting in shape fiscally doesn’t work that way. A single act of giving in to your desires, buying too much house or car, for example, can outweigh months or even years of consistent good money behavior. It would be as if a single slice of a special cake could cause you to gain ten pounds.

Conversely, being relatively unvirtuous with day-to-day small things, e.g. lattes, is comparatively harmless on the money front. What matters in money is winning a few big battles. With food there are no big battles. What counts is your overall rate of success. Which is why the saving-dieting analogy, although awfully convenient, can do more harm than good.

[Photo: Lotus Head]

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