We live in a world of convenience, and the use of credit is no exception to that. Hey, I’m not arguing the luxury of convenience! We all need to have some things in life be easily attained, but where is the limit on this? Where is the line of when things become too easy? Does getting things too easily impact the way we relate to those things?
Yes, it does. Recent studies have shown that helpful things don’t always translate into the mind’s perception of them being quality things. I recently read an article in Psychology Today about this very topic. It was refreshing to see the clear correlation between effort and meaning and how this relates to cash! If you have children, you’ve inevitably seen this first hand. If you give a child everything they want, they don’t learn how to find satisfaction or happiness. Why? Because they don’t learn how to work for what they want and are not required to put in effort t get what they want.
The expending effort, even if it is just a little bit of effort, impacts the mind in a positive way. Money, cash, in particular, is an excellent example of this. We all have to work to earn money; the effort has been expended in some fashion to get it. Well, perhaps not everyone, but most people have to work in some fashion to get an income stream. The use of credit is like a monkey wrench in this system. You can get what you want, even if you don’t have the money, then pay for it later or over time.
This leads to impulse spending and independent monetary expenditure. While it may seem good for business, is it really? Can you build a quality, consistent and long term clientele with impulse spending? Probably not. There is a lot of competition for business now days and many options available to consumers. Because of the ease of spending, both with cash and credit, consumers are now seeking more for depth and meaning in their purchases than solely in the product being purchased. If you can’t provide consumers with the feeling of quality and depth in their overall experience, they are apt to move on and look elsewhere for someone or something that can.
Cash spending is a part of this. Because the consumer has to physically hand over cash for a purchase, it triggers the mind to believing there is really an exchange occurring. When someone uses credit, this perception does not trigger the brain in the same way.
Take a moment to think about your spending inclinations and how you relate to cash vs. credit. Not how you think your relate to it, but how you actually do. Sit down and do a comparative analysis with your own experience.
Consumers, if you want to have more meaningful purchase experiences, use cash. Businesses and entrepreneurs, if you want to provide your customers with a more significant experience, ensure your consumers have easy access to cash for their purchases. Small things like this when working as part of an overall well planned out business strategy (or life strategy for the consumer) can lead to creating more depth and meaning in spending.