Today I read a post on GRS on the third stage of personal finance. I left a comment and said I would think more about it. So …
I have thought more about it.
General cognitive development follows an increasing list of stages as follows (these do not necessarily reflect JD’s stratification)
On the first stage, a person is unthinkingly copying what he sees his surroundings do. This is why advertising works. A person at this stage is entirely at the mercy of his surroundings. Good role models (parents?) lead to good financial behavior. Bad role models (TV shows?) lead to bad financial behavior.
In the second stage, the person becomes aware that there is more than one way of behaving. Keep in mind that some people never get to the second stage, maybe because advertising actively try to prevent it. This is the stage where the person might realize that there is another way to do things and that the other way may be better.
In the third stage, the person is actively collecting ways of doing things. Many personal finance blogs operate at the third stage compiling large lists of tips and tricks each describing a fragment of what constitutes good behavior.
In the fourth stage, the person is able to apply several of these tips to every day life. For instance, the person will be able to make a budget and follow a plan. This stage is about implementation. Many blogs also discuss this stage.
In the fifth stage, the person will be able to combine and refine different tips to achieve specific objectives. There are relatively few blogs discussing this problem, which falls under general lifestyle design. These lifestyles share the commonality of being built out of existing ways of doing things.
In the sixth stage, a person will be able to synthesize and create entirely new ways of doing things from seemingly unrelated tips in a lateral fashion. The important becomes unimportant and vise-a-versa. Things become holistically integrated and side effects are either eliminated or made beneficial.
So what is the mode of stages, that is, which stage has the most people in it? Given the preponderance of pf-blogs in stage three and four, one can perhaps surmise that most pf-blog readers are in stage two, hence the great appreciation of lists of 100 tips. I doubt that very many people in stage one would consider reading about personal finance. There are a few blogs about stage five and six. Perhaps people in those levels don’t care so much to write about it (I do). Perhaps there are not as many. It is difficult to say.
Some interesting questions to be pondered…
How does one grow from one stage to the next? Is regression possible? Do you think/feel/act differently in the different stages? Do your fundamental values and priorities change? And perhaps most importantly: Are you happier in some stages than in others?