Falling for Flattery

Jim Wasserman

ARE YOU WORTH IT? According to many sellers, you are—even if they have no idea who you are.

Economics generally divides consumed goods into necessities and luxuries. But behavioral economists understand that we need luxuries, at least psychologically. Purchasing things for ourselves is a way to self-validate, to say we are more than our base needs.

Who hasn’t felt good about an accomplishment and used that as a reason to splurge, entering the feedback loop wherein the purchase then justifies and even heightens our initial good feeling? Conversely, when people feel bad about themselves or their situation, often the curative advice is to “pamper yourself,” to go on a shopping spree to forget your worries—even if those worries are about money.

Advertisers, aware of this vulnerability, try to tap into it. There are many small-scale but famous examples. McDonald’s told the world in the 1970s that “you deserve a break today” with a jingle that Advertising Age named greatest of the century. At the same time, L’Oréal Paris told women that they should buy its higher-end products “because you’re worth it.” The slogan was so successful that the phrase inverted to become the popular positive affirmation “because I’m worth it.”

It’s an old sales trick, but—like many marketing techniques—it keeps working because it’s a simple ploy that strikes at our base vulnerabilities. Even when we see the nudge coming, we accept it and take its direction.

Problem is, it can be an expensive trap, especially for high-end rewards. The up-and-comer who gets a raise might reward himself with an “executive” car, vacation or even a whole new home. But that reward comes at the expense of savings and, if it’s a long-term commitment like a home, raises expenses that can nullify the increase in income.

Savings and long-term investment can’t, it seems, compete with the instant gratification of “let’s just enjoy it today.” Maybe it’s no surprise that delayed—but greater—gratification usually doesn’t win out. For most, even the idea of an earlier retirement remains at best a hazy shadow on the horizon.

I don’t think many people spent their way into debt at McDonald’s, nor did too many women have existential crises weighing whether they were truly worth it. But these nudges add up to potent influences on our spending decisions and hence our savings rate, especially as the cumulative message is “spend more than you were planning—worry about the budget later.”

But later eventually arrives. Remember, spending today is borrowing from our future self. Whether or not we deserve a break today, we’ll really deserve and want a bigger break tomorrow. The crucial question: Will our future self regret the spending choices we make today?

Jim Wasserman is a former business litigation attorney who taught economics and humanities for 20 years. His previous articles include Buying Power, Weighty Decisions and Scenes From a Life. Jim is the author of a book series on teaching behavioral economics and media literacy,  Media, Marketing, and Me. His latest book is Summa, a children’s story for multiracial, multi-ethnic and multicultural families. Jim lives in Granada, Spain, with his wife and fellow HumbleDollar contributor, Jiab. Together, they write a blog on retirement, finance and living abroad at

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