Is your income disposable or investable?

I think that most of us would agree that we are affected by our environment, that our upbringing and parents, peer groups and culture have an effect on who we are and dictate a lot of our outcomes. If we didn't believe this, it would make our position on blaming these things on our outcomes quite ridiculous -

"It's because my parents didn't..."

If we are products of our environment and behaviorally reflect back a lot of the conditions we experience, this raises some uncomfortable questions in regards to those who have lived their lives in adverse conditions, corruption and economic unavailability. We like to think we are better than the worst and on average we are, but that doesn't mean the average is good.

Then there is the way we frame the conditions we have and I was thinking about this in the morning in regards to risk-taking and investment strategy. Why is it they call extra money "disposable income" and not something like "investable income"? While this doesn't change the amounts in question, the vocabulary we use affects our visualization of concepts and by extension, how we behave.

Disposable means it can be thrown away, that it doesn't have a great deal of value, that it can be wasted. When we apply this to the money, it means that it can be used to consume goods and services that will depreciate in value, televisions, holidays, cars. These things have next to no chance of generating additional value once purchased.

However, investable income gives a different impression, as it sees the same money as a resource that can be used to attract or generate additional wealth. It isn't something that can be wasted, it is something that has to be used with thought and attention.

I wonder how much of our outcome is driven by the way we hold and apply concepts, where while everyone has the same concept, the variation in understanding dictates activities. When we look at this applied across average income groups and societal norms, we would likely see that those who have been raised in environments of plenty will have a different understanding of money than those who have been raised in an environment of scarcity.

Pushing this a little further into the activities of each group in regard to investment strategy, it is likely that those in abundance are going to see money as a resource to generate more money, but not a resource that should be wasted, over the other group, who may be more likely to see money as something to be used when it is available.

I think this is the same for kids when it comes to something like eating treat foods, where those who have a healthy relationship with it, are those who weren't denied it, they had it available, but were taught that it is something that needs to be used in moderation. The kids who had it denied, often build some kind of taboo around it, creating an imbalanced understanding, often making it more special than it deserves. Push this into adulthood and apply it to consumption of all things and we can see how this imbalance could present itself and affect outcomes.

Impulse control affects more than the food we eat, it also affects every "buying decision" we make and the meteoric rise of Buy Now Pay Later (BNPL) services, as well as increasing debt exposure and defaults on loans, suggest that we are losing the battle, on average.

A lot of people want to know what investment to make to become wealthy, which stock or coin to buy. They want to get a payrise so that they can buy a better life or win the lottery to change their life forever. However, the most important aspect of our future is our behavior and it is driven by our mindset and the understanding of the concepts that affect our world. Without developing a psychology that encourages us to invest ourselves and resources into building that better world, even when the opportunities arise, we will find ourselves lacking with scant availability on what is required to take advantage.

Having disposable income is not enough to invest, unless it is coupled with a mindset that converts what is disposable, into what is investable. If instant gratification is the habitual position, the ability to build long-term is greatly diminished as the inability to control impulses will continually erode any gains made.

While we feel that we act from the head, we are built from the ground up and a lot of the lessons we have learned make us who we are today, even though we never chose to learn them at all. Home-life, culture and the things we consume go into making us who we identify with as us, but we do have the opportunity to consume differently, to unlearn and relearn actively to build a mind and body of action that works toward where we want to be, rather than building walls between.

Perhaps a good place to start is reversing our concept of income from the lessons taught through society, where anything extra is able to be disposed of to satisfy our desires and if we want to invest, we have to make a conversion. Instead, anything extra is first investable income and is seen as a generative resource and if we want to buy something, we have to actively make the decision to "waste" it.

Words matter, but none more so than the ones we tell ourselves.

Taraz [ Gen1: Hive ]