An addiction may be defined as continued involvement with a substance or activity despite the negative consequences associated with it. More complex definitions refer to problems associated with brain reward and motivations. Addictions come in many forms sex, pornography, food, gambling, drugs, alcohol and are worth mentioning here because addicts very often have poor financial habits. People with addictions frequently have a problem with lying. They lie to and delude themselves, and they lie to others. Liars tend to make poor financial decisions.
Gambling is a massive problem in Australia, and is an obvious example of an addiction that can destroy finances. The government appears reluctant to tackle the gambling issue, presumably because the industry generates massive revenues.
In my opinion, this is unethical. Casinos operate in the full knowledge that a very significant proportion of their profits are generated from problem gamblers, and yet rather than tackling the problem, our laws seem to make it extremely easy for punters to blow their cash. The gambling industry continues to literally destroy the lives of thousands and thousands of people each year.
Some people may simply be addicted to spending or credit cards, sometimes known as ‘retail therapy’. Again, the financial effects of an addiction to spending are fairly obvious. What is perhaps less obvious is that hidden addictions to alcohol and other substances can also cause personal finances to be severely impacted. Indeed, being constantly in debt and in financial turmoil can sometimes be an indicator of substance abuse or addiction. In The Millionaire Next Door, the authors noted that smokers and alcoholics are poor accumulators of wealth, with seemingly small ongoing purchases adding up to a phenomenal expenditure over the long term.
If you have an addiction, it is vital to take steps towards overcoming it. Addictions control you and your behaviours. To be financially and spiritually free, you must nor be controlled by an addiction.
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