You might expect that sleeplessness would be one symptom of financial stress. If you're worried about paying bills or losing your house, you might well have trouble sleeping nights.
Now researchers are finding that fatigue itself can lead to money trouble, when it contributes to making bad choices in the first place.
And it's more than just a case of being physically tired. Our complicated modern lives present us with so many decisions all day, every day that we experience something called "decision fatigue." As John Tierney reported recently in the New York Times Magazine, "Decision fatigue helps explain why ordinarily sensible people get angry at colleagues and families, splurge on clothes, buy junk food at the supermarket, and can't resist the dealer's offer to rustproof their new car."
Willpower is not constant for any individual; it strengthens as you use it more, and it also can fatigue with overuse. Small wonder that it can wear out, when you think about how many choices—from what clothes to wear for the day, what TV show to watch, to the right phrase for a greeting—we make all day long.
Scarlett O'Hara might have been on to something when she routinely declared she would "think about it tomorrow." At the end of the day, when your deciding muscles are tired, you're more likely to make a bad choice.
And here's a surprise—it's because fatigue makes us more optimistic that we settle upon the choice that minimizes risk. Researchers at Duke University in Singapore and in Durham, N.C., observing participants with functional MRI, report that "Sleep-deprived individuals in the study tended to make choices that emphasized monetary gain, and were less likely to make choices that reduced loss."
One of the researchers provides the example of a casino atmosphere to illustrate the findings. "Late-night gamblers are fighting more than just the unfavorable odds of gambling machines; they are fighting a sleep-deprived brain's tendency to...seek gains while discounting the impact of losses," says Vinod Venkatraman, lead study author and grad student in psychology and neuroscience at Duke.
Habits and routines can be your ally. A very wise teacher once told me, "A bad habit is easy to make, but hard to live with; a good habit is hard to make, but easy to live with."
Don't worry that you'll never have another spontaneous moment. Think of a calendar that reminds you when meetings and appointments occur—without that framework, you couldn't identify "free time" for that spur-of-the-moment lunch with a friend.
Imagine, for example, how you might trick out a new car if you're making choices at a dealership in the late afternoon after looking at multiple options for hours. If you've ever bought a lot more car than you planned to, maybe now you know why.
The people at your credit union are serious about helping you achieve and maintain financial health. They bring you this website and other tools to help you make the most of your financial resources. The Financial Fitness Challenge continues to look at ways you can make better financial habits no matter what condition the economy is in.
Each month we randomly select five winners to receive $50 Visa gift cards; we choose each month's winners only from that month's entries, so enter often. Remember to register for the Financial Fitness Challenge.
Susan Tiffany, CCUFC
Home & Family Finance® Resource Center
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