materialism, quality of life & financial planning

Materialism, Quality of Life & Financial Planning

Tim Kasser, Ph.D.

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Political Discourse

• “…the American people have got to go about their business. We cannot let the terrorists achieve the objective of frightening our nation to the point where we don’t conduct business, where people don’t shop” (reported in The New York Times, October 12, 2001)

Materialism’s allure

• The percentage of incoming American First-year college students reporting it is “very important” or “essential” to be “financially well-off”:

• 42% in the mid 1960s

• 75% in the mid 2000s

Messages of Materialism

• Can purchase happiness

• Important to work and consume

• Life is meaningful and people are successful to the extent they have money, possessions, and the right image

Is this true?

• Psychological costs

• Social costs

• Ecological costs

• Financial costs

Measuring Materialism

• Survey methods (e.g., Belk, 1985, Richins & Dawson, 1992)

• Rate agreement with statements• Sample Items

– My life would be better if I owned certain things I don’t have.

– I like to own things that impress people.– I like a lot of luxury in my life.– I would rather buy something I need than borrow it from

someone else.

Measuring Materialism

• Values strategy (e.g., Kasser & Ryan, 1993, 1996)• Rate many goals, guiding principles, (e.g., family,

spirituality, fun, etc.)• Sample materialistic items

• You will have a job that pays well• You will have many expensive possessions• You will achieve the “look” you’ve been after• You will be admired by many people

• Examine relative importance of goals• All of us are somewhat materialistic

Happiness

Diminished HappinessKasser & Ryan, 1993, 1996, 2001; Sheldon & Kasser, 1995, 1998, 2001

• Higher:– Anxiety

– Depression

– Physical Symptoms

– Unpleasant emotions

– Drug & Alcohol Use

• Lower– Self-actualization

– Vitality

– Life Satisfaction

– Pleasant Emotions

Found in many samples

• Types of people– Middle & High School

students

– College Students

– Adults

– Business People

• Countries– Australia – Denmark– Germany– Hungary – India – Russia– Singapore – S. Korea– United Kingdom

Social Behavior

Social Behavior

• Care less about:– Being helpful and loyal– Mature love and true friendship– Social justice and equality– Schwartz (1996)

• More manipulative and competitive– McHoskey (1999); Sheldon et al., (2000)

• Less pro-social and more anti-social behavior– Cohen & Cohen (1996); Kasser & Ryan (1993);

McHoskey (1999)

Social Behavior - PrimingVohs et al. (2006)

• Unscramble sentences• Control sentence: “cold it desk outside is”• Money sentence: “high a salary desk paying”

Social Behavior - PrimingVohs et al. (2006)

• Unscramble sentences• Control sentence: “it is cold outside”• Money sentence: “a high paying salary”

Time spent helping

0

20

40

60

80

100

120

140

160

Time spent helping

MoneyNo Money

# Pencils Gathered

17

17.5

18

18.5

19

19.5

20

# Pencils gathered

MoneyNo Money

Ecological Behavior

Ecological Outcomes

• Care less about the environment– Saunders & Munro (2000); Schwartz (1994)

• Fewer pro-environmental behaviors– Brown & Kasser (2005); Gatersleben et al. (in prep);

Kasser (2005); Richins & Dawson (1992)

• More greed and consumption in resource-dilemma games– Kasser & Sheldon (2000); Sheldon & McGregor (2000)

Ecological Footprint

• Number of acres people use to support their lifestyle

• Transportation, food, housing

• Brown & Kasser (2005)– Higher materialism, higher Ecological

Footprint

Financial Behavior

Financial Behavior

• Three options for money– Spend– Save– Share

Spending(Richins & Dawson, 1992)

• If imagine a $20,000 windfall, high materialists spend $3,445 on buying for self vs. $1,106 for low materialists

Spending(Kasser et al. 2009)

• In 92 adults, materialism associated with habits of:

- using cash card,

- going shopping to lift spirits

- spending money one doesn’t have

- buying because of the brand

Spending(Brown, Kasser et al., 2009)

• 83 adults kept track of all spending behaviors >$5 for 3 weeks

Spending(Brown, Kasser et al., 2009)

• 83 adults kept track of all spending behaviors >$5 for 3 weeks

• Controlling for income, materialism associated with

- More frequent discretionary purchases

- More $ spent on necessary purchases

Saving(Kasser, 2005)

• In sample of 206 adolescents, materialism associated with saving less of imaginary $100 windfall

Saving(Kasser et al., 2009)

• In sample of 92 adults, materialism associated with:

- Less thrifty personality

- Losing sleep thinking about $

- Not following budget

Sharing(Richins & Dawson, 1992)

• Imaginary windfall of $20K, high materialists give away $1822 vs. $4413 for low materialists

Sharing(Vohs et al. 2006)

• Unscramble money vs. neutral sentences

Sharing(Vohs et al. 2006)

• Unscramble money vs. neutral sentences

• Gave subject $2 in quarters

Sharing(Vohs et al. 2006)

• Unscramble money vs. neutral sentences

• Gave subject $2 in quarters

• Asked for donation to University Student Fund

Amount Donated

0

0.2

0.4

0.6

0.8

1

1.2

1.4

Monetary Donation

MoneyNo Money

Two-fold Strategy

Two-fold Strategy

Materialism

Two-fold Strategy

MaterialismCauses

Two-fold Strategy

MaterialismCauses

Two-fold Strategy

MaterialismCauses HealthyValues

Two-fold Strategy

Material-ism

Causes HealthyValues

Causes of Materialism(Kasser et al. 2004)

• Social Modeling– Higher if friends, parents, peers care– Higher if more television– Higher if live under neo-liberalism

• Insecurity– Higher if cold parenting, divorce– Higher if poverty– Higher if thinking of death

Healthy ValuesGrouzet, Kasser et al. (2005)

• Assessed aspirations in 11 domains– e.g., Spirituality, Hedonism, Affiliation, Health,

etc.

• >1800 College students in 15 nations

• Circular Stochastic Modeling– Adjacent goals are consistent– Opposing goals are conflictual

Self-transcendence

Physical self

Extrinsic Intrinsic

Spirituality

Community

Affiliation

Self-acceptance

Physical health

SafetyHedonism

Financialsuccess

Image

Popularity

Conformity

Self-transcendence

Physical self

Extrinsic Intrinsic

Spirituality

Community

Affiliation

Self-acceptance

Physical health

SafetyHedonism

Financialsuccess

Image

Popularity

Conformity

Self-transcendence

Physical self

Extrinsic Intrinsic

Spirituality

Community

Affiliation

Self-acceptance

Physical health

SafetyHedonism

Financialsuccess

Image

Popularity

Conformity

Intrinsic ValuesKasser & Ryan (1996)

• Self-acceptance“I will follow my interests and curiosity where

they take me.”

• Affiliation“I will express my love for special people.”

• Community Feeling“I will help the world become a better place.”

Happiness

• More happiness• More life satisfaction• Higher vitality• Less depression• Less anxiety• Fewer physical

symptoms

Social Behavior

• More prosocial behavior

• More empathy• More cooperation• Less antisocial

behavior

Ecological Behavior

• More environmentally friendly behaviors

• Lower Ecological Footprint

• Less consumption in forest dilemma game

Two-fold Strategy

Material-ism

Causes HealthyValues

Avenues for Change

• Conversations with clients

- Responses to Insecurity

- Voluntary Simplicity

• Policy changes

- Advertising

- Indicators of Progress

Insecurity

• Studies show feeling insecure can drive materialistic behaviors

- past experiences with family

- economic insecurities

- worries about death

- hunger

Insecurity - Directions

• Financial planners often see clients during periods of transition & insecurity

• Opportunity for “Post-traumatic growth” and helping clients create a new life narrative focused around intrinsic values

• Savings promotes security

Voluntary Simplicity

• Rejection of work-spend lifestyle

• Instead focus on “inward riches” of caring about personal growth, family, volunteer activity, and ecology (Elgin, 1993)

• Brown & Kasser (2005) compared 200 VSrs with 200 mainstream U.S. citizens

VS Lifestyle

High

Well-being

Ecologically

Responsible

Behaviors

VS Lifestyle

High Intrinsic &

Low Extrinsic Values

High

Well-being

Ecologically

Responsible

Behaviors

Voluntary Simplicity - Directions

• Explore ideas about happiness and values, and about what “affluence” really means

• Introduce established VS programs– Your Money or Your Life– Simplicity Circles

Advertising

• Designed to promote consumerism• Often creates feelings of insecurity• Presence everywhere promotes social norm

that consumerism is good• Exposure via TV associated with higher

levels of materialism (Kasser et al., 2009; Schor, 2004; Sirgy et al., 1998)

Advertising -Directions

• Remove ads from public places

• Ban advertising to children

• Tax advertising as a form of pollution

• Use revenue to promote intrinsic values

National Indicators of Progress

• Currently Gross Domestic Product is dominant• But GDP has many problems• Alternative indicators include metrics of intrinsic

values in computation• Examples:

– National Well-being – Bhutan’s Gross National Happiness– Happy Planet Index– Genuine Progress Indicator

Gross Domestic Product vs. Genuine Progress Indicator

Gross Domestic Product vs. Genuine Progress Indicator

National Indicators - Directions

• Adopt Alternative Indicators

• Hopefully, citizens will recognize that increases in GDP ≠increases in Quality of Life

• Thus, new policies will be developed

Summary

• Materialism associated with lower quality of life

• Can reduce materialism by

- Removing causes

- Promoting healthier values

• Financial planners can contribute