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A few weeks ago, we talked about the psychology of investing.  Turns out that psychology plays a big role not only in investing, but also in how we spend and save, and most importantly, how we end up in debt.

Don’t people end up in debt because they spend more than they earn? It’s pretty simple, right?

Yes and no.  To explain debt in the past, we’ve pointed to poor decision-making and values gone astray in a culture that encourages instant gratification. But what’s interesting is that recent research shows that scarcity by itself is enough to cause financial self-sabotage. It’s called the “scarcity effect”—a basic economic principle that something in low supply becomes higher in demand.

So you’re saying that having a lower income causes people to go into debt?

Exactly! And it’s not just because a lower income means it’s harder pay the bills—It’s a poverty trap. When facing financial turmoil, people start to borrow at high interest rates they know will hurt them, taking on loans and making bad financial decisions they avoided before they felt desperate. Being in debt robs us of our sense of security and control, and these less quantifiable psychological effects can cause a very concrete fallout—reckless borrowing and deeper debt.

But isn’t that counterintuitive—to borrow if you’re already in debt?

It’s the way we’re wired. A few researchers from the University of Chicago’s school of business published a paper recently that detailed a series of related experiments. Their results showed that scarcity by itself—independent of personality or any other factors—fuels a drive to borrow recklessly.

In one experiment, participants competed in rounds of the game “Family Feud.” One team was “poor,” allotted only 15 seconds per round, while another was “rich,” with a budget of nearly a minute per round. Both groups could borrow time against future rounds, but the “poor” team borrowed far more, progressively shrinking their future paychecks while the rich mostly avoided debt.

So this is a common problem?

Unfortunately, it’s all too common.  I have some pretty grim statistics for you.

Unemployment may have leveled off for the time being. Most American workers are still able to find jobs, but an increasing proportion of them are not able to make ends meet at the end of the month because good-paying middle class jobs are being replaced by low income jobs.  About 25% of American workers make $10 an hour or less. Half of all American workers earn $505 or less per week.

One survey found that 77% of Americans are living paycheck to paycheck at least part of time. Seventy seven percent! Knowing that even the average person is having a hard time paying the bills, it’s easy to see how those with the greatest financial burdens are caught in a cycle of debt, and it’s just getting worse.

According to the Urban Institute, the average debt for households earning $20,000 a year or less more than doubled to $26,000 between 2001 and 2010.  That’s debt that outweighs the household’s annual income, and it’s really hard to come back from.

Well how can people avoid this trap?

First, know that you’re not alone. Next, check your pride at the door. It’s time to get some help, and you need to be honest about your financial reality. Finally, see where you can make cutbacks and don’t think you can pay off debt with more debt! One common pitfall is the “payday loan” where you borrow against your paycheck. Payday loan operations typically charge 15 to 30 percent interest every two weeks. Many people who have used them report slipping behind quickly and being forced to pay off the loan. And do you know how they do that? With yet another loan, frequently from another payday operation. It’s a vicious cycle. If you find yourself in a hole, the first thing you need to do is stop digging.

Mellody is President of Ariel Investments, a Chicago-based money management firm that serves individual investors and retirement plans through its no-load mutual funds and separate accounts.  Additionally, she is a regular financial contributor and analyst for CBS News.