Pattie Lovett-Reid: Your brain is tempting you to splurge on Raptors tickets
Does your brain compromise your financial success?
Way back in 2010, I had the opportunity to sit down with Ravi Menon, who at the time was the Canada Research Chair in Functional and Molecular Imaging at Western University. I was trying to understand why we get carried away and make financial decisions based on our so-called gut reaction and why we behave the way we do when it comes to money? In other words, we can be irrational and spend recklessly when we can least afford it.
I can’t help but wonder given all the hype around the NBA playoffs and the Toronto Raptors’ odds of a championship win, some might find themselves regretting the financial decisions they make in the heat of the moment.
What I learned from Menon was that our brain is incredibly complex and has been hardwired to make split-second decisions from thousands of years ago, which tends to value short-term gains.
Fans are in the moment, and win or lose, they want to be there. Reports show some are paying thousands of dollars to see the Raptors play one game. To be fair, it isn’t always a quick decision. You may even have a battle of the brain going on – cost versus the fear of missing out (FOMO). Given all the excitement around the NBA finals, it is easy to understand how your emotions can get the best of you.
To some extent, it may not be your fault if you act a little irrationally.
The brain’s reward system, also known as the nucleus accumbens, is situated right behind your eyes. This is the area that is responsible for your happiness level and can cause as much trouble for people and their finances as fear does. It can literally light up and you will feel amazing in the moment.
You snap up a ticket and you are on cloud nine. However, if you really can’t afford the ticket, your short-term high will evaporate quickly leaving you with financial regret.
Whether the Raptors win or lose, I would rather see you light up by being financially responsible, showing some discipline, focusing on your long-term goals, while cheering from the sidelines and avoiding the temptation to purchase the hottest ticket in town.
Easier said than done. I get it. The decisions we make affecting our money are bound to be partly driven by emotions. Instead of trying to eliminate the emotion, recognize there are a lot of influencing factors going on in our brains every time we make a money decision.
Any sort of financial regret by spending beyond your means after the short-term satisfaction may cause you to think twice.
I will be cheering on the Raptors from the cheapest seat in town – my couch.