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Lessons from my worst money blunders: worrying what others think

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(Read caption) This $1.3 million diamond-encrusted Rolls- Royce Badge was on a display at a specialty-equipment convention in 2006. Do such luxury items represent your values or are they meant to impress others?

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Along my financial journey in life, I made a great number of mistakes. In this ten part series which runs from July 19 to July 30, I’m going to focus on ten of my worst mistakes and the difficulties and successes I’ve had in overcoming those mistakes.

I focused entirely too much on what other people thought of me.

Throughout my teen years and adult life, I bought many, many things with an eye almost exclusively on what others thought of me. My clothes. My education and career choices. My gadgets. My housing. My automobile. My golf clubs. My meals.

I believed that somehow I could create a more positive image of me through others by buying things or doing things that they approved of. If I lived in the right home, I thought others might think of me as successful or as a family-oriented person. If I owned the right gadgets, people might see me as tech savvy and affluent. If I spend money in front of people from my home town, they might see me as some sort of great success.

All of it was a gigantic waste of money.

The only people that put any stock in such frivolous things are the people that know you only in the most tenuous of fashions because that’s all they know about you. If you’re going to build any sort of relationship with someone, it’s going to be based on who you are, not what kind of stuff you own. If there are people out there who genuinely believe things like, “I won’t be friends with someone who doesn’t have a $3,000 golf club or a $750,000 home,” then their values are so warped and misplaced that you will never be able to please them. Don’t bother.

That’s not to say it isn’t worthwhile to think about others, but most people make up their mind about you based on other things. Are you kind to others? Do you engage them politely? Do you listen to what they say? Are you clean and not offensive to others? If you want to build a strong social network, those are the things to focus on, and those things don’t require an outlay of money.

This isn’t a call to ultra-frugality, either. Spend money on what you value, not what other people value. I buy automobiles based on reliability and gas mileage and safety, not how they look in our driveway or whether the neighbor will be impressed. If I want to build an actual relationship with my neighbor, I’ll go over there and say hello, not buy a car to impress. If I don’t want to build a relationship with my neighbor, why would I possibly care at all what he or she thinks of my car? Now, if I really got a lot of very personal value out of a luxury car purchase, I might choose to purchase one, but that’s not where my values lie. Neither side of that decision has anything to do with my neighbor.

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“But what about your reputation?” Most of the things that can be said about you that can really hurt you or build a positive reputation about you are based on the actions you take, not on the stuff you own. You can own all of the nice cars and homes and boats you want, but if you hit your spouse, people won’t like you. You can live in a shack, but if you spend countless hours building a great community softball league (and keep yourself clean and somewhat presentable), people will love you. You can own a BMW and wear a $3,000 suit, but if you’re rude to your neighbors, they’ll help you build a bad reputation. You can drive a used Toyota and wear $2 Goodwill pants, but if you’re willing to lend a hand to help your neighbor re-shingle their roof, they’ll speak positively about you in the community.

What can you do to avoid this trap?

To put it simply, don’t waste a single, solitary dime on a purchase meant to impress others. Such purchases don’t pay off because they don’t improve who you are. Focus instead on building you into a great, friendly, happy person – and most of the methods of doing that don’t cost a dime.

Instead, spend your energies actually building real relationships with people. Instead of spending two hours picking the “perfect” handbag to drive the other women crazy with envy or spending three hours at the golf store trying to pick out the driver that will let you dominate the boys, spend that time helping out a neighbor, connecting deeply with someone important to you, or working on some project that will make your life less stressful or improve your life quality (which will make further interactions much easier and much more positive).

Stuff doesn’t make a person.

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