Best of the Week
Most Popular
1.Stocks Bear Market Apocalypse Imminent Crash Gets Nuked Again - Nadeem_Walayat
2.Gold And Silver – A Reality Check - Michael_Noonan
3.The Killer Ape, Human Evolution, Artificial Intelligence and Extinction End Game - Nadeem_Walayat
4.Stock Market S&P 500 Volatility-Based Price Probability Range - Richard_Shaw
5.A Stocks Bear Market Is Now More Likely Than Not - Richard_Shaw
6.Money Supply and the Fed’s Serious Inflation Risks - Zeal_LLC
7.More Selling for Stock Market, Gold? - Brad_Gudgeon
8.Gold, Silver Precious Metals: a Critical Week Ahead - Rambus_Chartology
9.Gold Price Change in Character - Gary_Savage
10.Advice for Biotech Investors: 'Hold Your Powder' 'til Winter - TLSReport
Last 5 days
Stock Market Rally May be Broken - 9th Oct 15
Gold Stocks Major Breakout - 9th Oct 15
Contrarian Investing - Being the 10th Man - 9th Oct 15
U.S. Can Expect Recession in 1-3 Years - 9th Oct 15
The Greater Economic Depression Deep State - 9th Oct 15
Financial Markets Calm Before the Storm? - 9th Oct 15
Stock Market History Calling, Says Performance will be Crappy for Another ~10 years! - 9th Oct 15
Why This Feels Like an Economic Depression for Most People - 9th Oct 15
Dr Copper Back from the Dead - Time to Buy or Blink - 8th Oct 15
Glencore Rout Blamed on Short Sellers Playing With CDS - 8th Oct 15
The Real Reason for the Refugee Crisis You Won’t Hear About in the Media - 8th Oct 15
US Stocks: The [Trend]Line Between Bull and Bear Market - 8th Oct 15
Bundesbank “Reassures” Re. Gold Bullion Reserves as Deutsche Bank Shocks With €6 Billion Loss Warning - 8th Oct 15
How Our Aversion To Change Leads Us Into Danger - 8th Oct 15
Moving Stem Cell Research Forward: Bernie Siegel of the Genetics Policy Institute - 8th Oct 15
Stock Market VERY IMPORTANT Turn Date - 7th Oct 15
The 5th Convergence…An Economic & Financial Superstorm That Will Devastate America - 7th Oct 15
Summers Grades Janet Yellen's Fed Performance 'Incomplete' - 7th Oct 15
Gold Versus Central Banks Paper Ponzi - 7th Oct 15
QE3 is Over Get Ready for QE4 - 7th Oct 15
How to Profit from Government Mandates in Biofuels - 7th Oct 15
A Key Oil Price Trend That Everyone Is Missing - 6th Oct 15
Stock Market Turn Appears to Have Been Made - 6th Oct 15
Designing a Dividend Growth Portfolio for a Specific Retirement Yield Objective - 6th Oct 15
Peter Schiff Predicts Gold Price Breakout - Video - 6th Oct 15
Theresa May Declares War on Immigration - Conference Speech Full Transcript - 6th Oct 15
Is Russia Plotting To Bring Down OPEC? - 6th Oct 15
Target Date Funds As Aid In Retirement Investment Portfolio Design - 6th Oct 15
Stocks Bear Market Apocalypse Imminent Crash Gets Nuked Again - 6th Oct 15
Redesigning Internet and Facebook to Explore Their Full Potentialities... - 5th Oct 15
Nightshades Curb Your Enthusiasm - 5th Oct 15
U.S. Recession Watch, High-Yield – Rising Defaults - 5th Oct 15
The Social Challenge to Find Humanity in Capitalism - 5th Oct 15
Fed Interest Rate Hike: "I don't care. It doesn't really make much of a difference" - 5th Oct 15
Gold Rose 2.2%, Silver Surged 5.4% After Poor Jobs Number On Friday - 5th Oct 15
Gold, Silver Precious Metals: a Critical Week Ahead - 5th Oct 15
Stock Market Correction Still in Force - 5th Oct 15
Gold Price Change in Character - 5th Oct 15
Putin’s Blitz Leaves Washington Rankled and Confused - 4th Oct 15
More Selling for Stock Market, Gold? - 4th Oct 15

Free Instant Analysis

Free Instant Technical Analysis

Market Oracle FREE Newsletter

Are You An Investor Who Suffers From Hyperopia?

InvestorEducation / Learning to Invest Feb 13, 2013 - 08:48 AM GMT

By: Investment_U


Alexander Green writes: During the housing boom a few years ago – while home equity values were climbing – American consumers went on a world-class spending spree. The personal savings rate dropped to zero, then went negative. Consumers were actually spending more than they were earning.

But the housing collapse and resulting financial crisis had a sobering effect. Saving is in fashion again. According to the Federal Reserve Bank of St. Louis, the nation’s personal savings rate is currently 6.5%.

Yet two-thirds of Baby Boomers confess that they haven’t saved enough for retirement. A 2010 survey found that 34% of Americans have zero savings, including 22% of those 65 or older.

Blame it on our materialistic world, the American consumer culture or just plain old lack of self-control, but millions have a hard time passing up immediate gratification in order to reach long-term financial goals.

Yet there is one class of savers and investors with an entirely different problem and, in some ways, it is just as unfortunate…

Psychologists call it hyperopia.

That’s a fancy of way of describing people who are so far-sighted they can’t enjoy their money. They are good at looking ahead and saving for the future, but they can’t enjoy what they’ve earned.

The Depression Mentality
Years ago, when my older brother was playing the mini-tour in Florida, he had a local businessman and sponsor – “Joe” – in Virginia who wanted to come down and watch him play.

“Great, I’ll book you a room at the Hilton nearby,” my brother offered.

“The Hilton?” Joe said. “Forget that. I’ll book myself a room at the Motel 6.”

Now there’s nothing wrong with staying at a Motel 6, especially if that’s all you can afford. (Growing up, I never stayed in anything better.) But Joe was independently wealthy. He owned a string of McDonald’s franchises.

However, he grew up in the Depression. He had the kind of keen understanding of “scarcity” that eludes most people today. And, like many businesspeople, he owed his success, in part, to keeping a sharp eye on costs.

Still, he was getting on in years. (In fact, he died less than three years later.) He never spent much of the fortune he earned. Ironically, he could let his heirs blow through it. But he couldn’t bring himself to spend it himself.

Author Matthew Kelly writes that he, too, came from meager circumstances and – even after he was a bestselling author and an in-demand lecturer – he couldn’t make himself part with much of what he was making.

If someone you know has hyperopia, you might suggest they do what Matthew Kelly did…

Planning How Much to Spend
Just as most folks need to plan and make a habit of saving, some need to plan and make a habit of spending. Kelly figured out how much of his after-tax income he could drop with a clear conscience and then set goals to make sure he did it.

It’s a minority to be sure, but some folks – practical ones who work hard, save and invest – may need to pre-commit to indulgence. That could mean choosing a gift certificate over cash back when redeeming credit card reward points. Or perhaps reframing money spent as an investment in restoring yourself for work.

In my experience, workers generally fall into one of two categories: those who have to be goaded to work and those who have to be reminded to stop. The same is true of savers. The majority are clearly not saving enough (or leaving it untouched long enough). But some of the others aren’t enjoying the fruits of their labors.

It can be a great balancing act, deciding what to save, what to spend and what to give away. But the oldest adages are entirely true. You only live once. You can’t take it with you. Hearses don’t have luggage racks – and shrouds don’t have pockets.

So earn it. Save it. And pass it along. We’re only here for a visit.

Good Investing,


Source :

by Alexander Green , Oxford Club Investment Director Chairman, Investment

Copyright © 1999 - 2013 by The Oxford Club, L.L.C All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Investment U, Attn: Member Services , 105 West Monument Street, Baltimore, MD 21201 Email:

Disclaimer: Investment U Disclaimer: Nothing published by Investment U should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Investment U should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Investment U Archive

© 2005-2015 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Biggest Debt Bomb in History