Personal Finance FAQ

Monkey Brain Can’t Seize the Opportunity

Tightwad Gazette
Monkey Brain will never subscribe to this magazine!

“With money in your pocket, you are wise and you are handsome and you sing well, too.”
–Yiddish proverb

Do you know any Ebenezer Scrooges in your life? The ones who squeeze pennies so tightly that they’re probably creating nuclear fusion?

Are you one of those?

Or do you go into a store, see a sale, and buy something just because it’s 5 cents off?

Are you somewhere in the middle? Spend when you need to and save when you don’t?

As I’ve aged, I’ve become more sanguine about spending money. I’m literally dead middle of the scale.

Tighwad Spendthrift Spending Scale by Fort Worth Financial Planner Hull Financial Planning

Want to know where you stand?

Take this quiz. Then come back.

Knowing your attitude about spending money is crucial in helping you save more money.

Read on to find out why.

Monkey Brain has laser focus at the wrong time

For those of you who are new to me, there are two main sections of your brain that are constantly fighting each other. The limbic system is what houses our primal desires. It was borne of the time when we lived in caves. It’s what we share with the rest of the animal kingdom, which is why I call it Monkey Brain. Monkey Brain wants pleasure, and he wants pleasure now. He doesn’t care about the future, because, back in the caveman days, he had no idea whether or not he was going to even make it to tomorrow.

Monkey Brain is the reason that we make 90% of the money mistakes that we make.

In the other corner is what I call Thinking You. It’s the prefrontal cortex. It thinks about the future and thinks rationally. The prefrontal cortex is what separates us from the rest of the animal kingdom and allows us to win the food chain wars.

They fight each other all of the time. You just don’t know it.

Or, rather, you didn’t know about it until now.

Way back in the caveman days, it didn’t pay to multitask. If there was a woolly mammoth in front of you, then you wanted all of your mental powers focused on either running away from that mammoth or trying to catch it for dinner. Distractions increased the likelihood that you’d be Mammoth Chow™.

Thus, when something very important appears in Monkey Brain’s binoculars, he pays a lot of attention.

When would something catch Monkey Brain’s eye?

When you’re shopping!

If you’re like me, if you absolutely, positively must go shopping, then you go straight to the store, find the item you want, buy it, and leave.

Actually, I just buy it on Amazon. Amazon Prime FTW!

But, what if you want a 183” flat screen TV, you go to the store, and find an entire aisle of 183” flat screen TVs?

Monkey Brain gets frozen, like a deer in headlights.

Since Monkey Brain doesn’t like math, he uses simple shortcuts to determine what he should buy.


You: “How sage…”

How can you convince Monkey Brain to buy a cheaper 183” flat screen TV, or, better yet, that you don’t even need a 183” flat screen TV (you don’t, trust me)?

This is the question that Yale’s Shane Frederick and others attempted to answer in a series of experiments.

What happens when we shop is that we completely neglect the other things we could do with the money. The lost ability to spend the money on other things is called opportunity cost, and when Monkey Brain narrows in on buying something, opportunity cost goes right out the window.

If you want to curb your shopping and spend less money, then you need to bring opportunity cost in through the back door.

As we saw in the article “Make a Decision and Make Monkey Brain Stick to It”, Monkey Brain likes to keep choices. He hates committing to a decision. In this case, you can use that preference to your advantage.

In order to curb your desire to spend, you don’t even have to imagine what else you could spend the money on besides the 183” flat screen TV that is right in front of you.

All you have to do is reframe the choice:

I could spend $X on this [flat screen TV/pair of Jimmy Choo shoes/fantabulous Justin Bieber poster] or I could keep the $X to spend later.

It does help some to think about what else you could spend the money on rather than the item that is right in front of you.

Even if you’re bound and determined to buy the 183” flat screen TV, introducing the idea of having money to spend later will make the cheaper option look much better. Let’s say that you have the option of spending $1,000 on a thousand pixel 183” flat screen TV or $800 on a 800 pixel 183” flat screen TV. Unless you’ve done prior benchmarking of your options, you have no idea whether the extra 200 pixels is worth $200. All things being equal, you’d rather spend less money, but Monkey Brain will scream that “PIXELS IMPORTANT, STUPID HUMAN!”

Here’s how to shut him up:

I could spend $1,000 on a 1000 pixel TV or spend $800 on a 800 pixel TV and have $200 to spend later.

According to the experiments run by Frederick’s team, that simple nuance will make you about 24% less likely to pick the more expensive option.

Your attitude matters

Remember the test I had you take earlier?

This is where knowing the results of the test comes in handy.

Tightwads are less likely to be influenced by these little psychological tricks.


Because spending money already causes them pain!

The trick still works; if you’re a tightwad, then reminding yourself of opportunity cost will still decrease your likelihood of going with a more expensive option by about 15%.

If you’re a spendthrift, though, this technique is really powerful. Spendthrifts are 46% more likely to spend less money when they think about opportunity cost.

What a bargain!

Are you a tightwad or a spendthrift? Have you ever used this trick when shopping? Let’s talk about it in the comments below!


Jason Hull, CFP®, was the co-founder of Broadtree Partners, a firm that acquires $1-5MM EBITDA companies. He also was the co-founder of open source search consultancy OpenSource Connections, a premier Solr and ElasticSearch firm. He and his wife FIREd (financial independence retire early) at 46 and 45, respectively. He has a BS from the United States Military Academy at West Point and a MBA from the University of Virginia Darden Graduate School of Business.

You can read more about him in the About Page.

9 replies on “Monkey Brain Can’t Seize the Opportunity”

Great insights. I scored a 5 on the quiz– especially the comparison to “Mr. B” who won’t spend even when he “needs” to. Apparently I’ve been able to decide that I don’t need much in the first place.
Although yesterday it turned out that I needed a $50 longboard fin, but I’ve been stalking that purchase for several months…

Was all the time you spent stalking worth however much you saved on the fin?

Funny, my accounting professor in grad school was named Mr. B. (I honestly don’t remember his full last name), and I suspect he’s equally as conservative!

I was going to take the quiz, but then I asked myself, would I rather spend 10 minutes on this, or spend no time on it and just watch Youtube clips and have the quiz to take later?

I’m bookmarking the post, as we’re trying to decide whether to proceed with a vacation as planned this summer (2+weeks in Europe, very pricey), or to take a smaller one this summer and find a way to hack our way to the same trip for less money next year. Monkey Brain wants to see Europe now, of course.

I’d opt for the outcome that allows more time. You don’t have to spend a ton of money to get great experiences. Some of my best experiences have included camping in the Etosha Plains and staying in a backpacker hostel in Cape Town. If you do it right, the biggest cost you’ll experience is getting there and getting around, so do what you can to a) minimize the other expenses, and b) amortize that travel cost over the most days.

I scored a 14, or “unconflicted consumer,” on the test. I find it pretty easy to tell my monkey brain to be quiet. I also don’t have a problem buying the things that make my life better or more interesting. Overall, I’d say I am more frugal than my wife, but that’s because she is always buying stuff or experiences for our son. I tell her she is spoiling him, and her reply is that she didn’t have a lot of things growing up, and wants to make sure he has more opportunities. I reiterate that she’s spoiling the kid, but who am I, other than the father.

Interesting, given that you’re pretty much dead middle of the pack. I guess you’re the exception to the rule!

Sounds like you and Mrs. S&C need to have a heart-to-heart about your values. I find, as a financial planner, that I’m a marital counselor just as much as I am a planner.

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