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Cutting costs doesn’t mean losing status

The New York Times recently ran an article on the many ways that Americans are finding to cut costs in the current price-of-living increase we’re facing.

Spending data and interviews around the country show that middle- and working-class consumers are starting to switch from name brands to cheaper alternatives, to eat in instead of dining out and to fly at unusual hours to shave dollars off airfares…Retail sales figures and consumer surveys confirm that Americans are strategically cutting corners, whether it is at the coffee house or the airport.

If you’ve been feeling the pinch of $3.60-a-gallon gas and milk, you’re not alone; it’s happening to everyone, and people are acting on it instead of pretending it’s not there. They’re pinching pennies, cutting back on luxuries, doing for themselves rather than purchasing convenience.

Discounting worries over the economy and such, this is fantastic news for our brains. Consider: we don’t have to spend money we don’t have to look better than our neighbors. In fact, if our neighbors are pinching pennies, we may not even have to spend the money we have. The social pressure is easing off (for the working- and middle-class at least) to have the newest, shiniest things, and since relative wealth is the key to happiness, we don’t have to work so hard and buy so much.

Aside from a slackening in subconscious tension that comes from being in a race for social status, being able to look better than others with less money is a positive pleasure for the brain. Two studies recently published in the scientific journal Neuron found that the brain processes monetary and social rewards similarly. Keeping up with the Joneses (among other factors) has kept us as a nation from saving as much money as we otherwise might; now, knowing that the Joneses are letting their manicured lawn go dormant and their fashionable clothes go out of style will give your brain a double charge.

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2 Responses to “Cutting costs doesn’t mean losing status”

  1. SE Optimizer says:

    Cutting cost is a way to make your business sustain for a long period or even for a lifetime as long as managed well by both business partners.

  2. Ivan says:

    Hi,

    Indeed – it’s what should businesses do, either in recession or good economy.

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