In the previous article, we talked about hedonism, (http://psihologiabanilor.ro/esti-hedonist/) the philosophical current put forward by Epicurus that questions human nature: that of seeking pleasure and eliminating pain. We mentioned the connection of this current with personal loans. Credit follows the path of hedonism: avoiding pain and seeking pleasure, while forms of saving do not. That is why many people do not like forms of saving.
Psychological implications in contracting financial products
A loan is the easiest way to get what you want. NOW! It is nice to immediately achieve what you want, even if you cannot afford it. This is how loans appeared. They help you put into practice what you want immediately, but at a higher cost. The loan must be repaid and you pay an amount greater than the amount borrowed at the end.
The pleasure of the moment is desired by each of us. We do not like to suffer, to despair until we get to implement what we want. We avoid pain as much as possible.
With a loan, pain is not perceived because the effect of the “expensiveness” of the asset comes gradually. Only at the end do you realize that you have paid double for the asset purchased through the loan.
With regard to real estate credit, avoiding pain represents the large amount that is paid in 30 years, and accepting pleasure is represented by the comfort of the house. Real estate credit represents that financial product that avoids great pain because being long-term, the brain does not feel the pain alarmingly.
Insurance with its savings component, being diametrically opposite: you save, receive interest and end up purchasing your own home, but later, although at the same value, it is not accepted because in the long term it causes pain. You wait to have something much later. Joy comes late, while you feel negative emotions: the sadness of not achieving the goal.
The monthly “payment” in such insurance is perceived as a search for pain. Nobody seeks pain. As such, these types of financial products are avoided. Instead of spending that monthly amount, it is “paid” for 30 years, during which time interest accumulates. Interest is between 2 and 5% per year. “Off! But the profit is too little, and the duration is too long! I better spend it!”
That’s right! Indeed, 30 years is a long time. And from the perspective of purchasing a home, 30 years is too long. The difference between the two is the moment when you can move into your home. If you purchase your home through a real estate loan, “your home” is not exactly your home, but the bank’s, as long as you do not repay the entire amount, that is, over 30 years. During this time, you may be left without a home (due to risks you are subject to), but if you purchase your home through traditional life insurance, then “your home” will truly be your home, in the true sense of the word, since you will buy your home with money down and the house will be in your name, without any other transfer. The risks are zero.
Efficient management of hedonism
As for the two products, the success of achieving the proposed objective lies in planning and discipline; financial discipline.
As we have seen, everyone has their own purpose, and in the financial market, all products are good if used correctly.
Why did I mention discipline? Because, in any action, whether it is the desire to become a champion in a field or the desire to move into your own house, discipline is a determining factor in achievement. Regardless of whether we are talking about 5 or 30 or 50 years, discipline brings success.
Discipline is defined by doing what you know is right to do, even when you don’t feel like doing it.
As such, discipline brings you success even if instead of avoiding pain, you seek it, just as you seek pleasure. Time is in finding the result. The expected result will come if you wait for it and if you are disciplined. Discipline, as you have noticed, is found both in sports (the most representative field, in which training causes pain, literally), and in finances.
From the perspective of the two products mentioned here, discipline influences the result. The presence of the discipline to pay the installments and avoid risks through planning, leads to the removal of the mortgage and the house will become “your home”. Success will come. What matters is how much time you allocate or, better said, how much you are willing to allocate.
Different perspectives, different paths
From a financial point of view, in order to obtain pleasure, it is necessary to be aware of the current situation, the goals set and the appropriate ways to achieve the proposed goals. Depending on the goal, we identify the right path. Maybe there is not one, generally valid one. Maybe there are more ways to achieve the same goal or there are different ways for different goals.
What I mean is that to get the comfort of your home in the shortest possible time, you can use a loan. Saving helps you set aside the money needed to pay off the loan early and enjoy your home, in the true sense of the word, much faster. Saving is the right way to protect yourself from possible problems that may arise during the loan: reduction or loss of income, health problems, etc. Your home will be safe this way.
The pleasure of enjoying the comfort of your home is supported by the savings plan. The pain caused by postponing the reward, as is the case with saving, is diminished by the pleasure of achieving the goal through the loan. Next, pain reduction also comes from planning for early loan closure.
By combining different paths, different perspectives, you have access to great satisfaction. You need to know all possible paths, to be open to different perspectives, if you really want to enjoy life.
By avoiding pain, you get satisfaction. But pleasure doesn’t always come immediately. The reward can be much greater if you wait for it, for a while. How long are you willing to wait? And, do you think the reward will be as expected?
Success in money awareness!
©2025 PSIHOLOGIA BANILOR - All Rights Reserved - Powered by 
