Recenty I wrote an article about buying lottery tickets when you were already heavily in debt. The main thrust of the article was focussed on the element of hope and how you can increase your chances of winning big money by joining a syndicate. I argued that while playing the lottery was a luxury it did offer a tiny glimmer of hope in what can otherwise be a bleak financial outlook. As such I argued that playing the lottery could be a good thing as hope is always a good thing.
Since I wrote the article I have come across a strange and slightly disturbing phenomenon related to the lottery post or more accurately recognized something that already existed. It was something that I had seen in a few people I knew and experienced it myself but I couldn’t quite understand it before. It is really only since I wrote that post did I come to understand it better. I call the phenomenon ‘windfall’ mentality.
Windfall Definition: Any unexpected acquisition, gain, or stroke of good luck
The attitude which accompanies the mentality is built around the idea that the money to pay off the person’s debts will come from somewhere – they will have a windfall. People with the windfall mentality will not focus on things like cutting costs and increasing income rather they will focus on things like playing the lottery or visiting an old aunt with the hope that she will leave them money in her will. Windfall mentality can be described as a sort of double or quits mentality – lets keep accumulating debt in the vain hope that someday soon we will have a windfall and that we will be able to pay back out debts in one go.
I had seen this attitude in people before but I could never quite put my finger on it. I always thought that these people were greedy or deluded but the reality is that they are just trying to cope the best way that they know how. Their mind has put them in survival mode. Unfortunately the way they are trying to cope with their debts is far from optimal – in fact I would go as far as to say that what they are doing is living in a fantasy world where they hope someone with a magic wand will rid them of their debts.
I think for all of us in debt that we all experience some form of this windfall mentality. I suspect that this usually occurs when we are in the denial phase of our debt. I have personally experienced this windfall mentality first hand. I was convinced that one of my share investments was going to be a multibagger (i.e. go up loads) when one of their new products came out into the market but this never materialized. It was only when the company came out with a profit warning did I realize that I had been kidding myself. The share tanked and I was in a worse state financially than I should have been. The struggle back was a lot more painful than it had to be.
I think for most people this windfall mentality doesn’t last long and people are smart enough to realize that their debts can only be solved by their own direct actions and efforts and not by some windfall. However for some the windfall mentality lasts a lot longer than the initial denial period. Some people never come out of the denial phase and are in a constant state of waiting for things to come to them rather than going out and making things happen.
Invariably nothing ever comes to the people with the windfall mentality. They sit and wait and hope and dream about how someone or something is going to give then thousands of dollars to solve all their problems and how life will soon be good again. It’s only when they are confronted by debt in a real situation such as a repossession that they get shocked back into reality and they then realize that they have a lot of lost time to make up.
The question you have to ask yourself is if you have the windfall mentality. Do you daydream that someone is going to save you from your debt with a nice lump of cash? Ask yourself how likely is it to really happen? I believe in miracles as much as the next person but I also believe that you have to go out and make your own luck. Are you making your own luck or are you waiting around for someone else to make it for you?
Related posts:
[...] The new class concept ties into the articles that I wrote about debt and lottery tickets and the windfall mentality that some people in debt have. This new social class breakdown is simply split into two categories. [...]