Lack of Budgeting Causes Poverty?

Recently, there are quite a few people losing jobs and going into debts. However, there is nothing surprising about that. In fact, the surprising thing is that a lot of those who get into real big problems are not the really poor folks, but rather those once-rich highly-paid executives. It is bad to lose jobs for anyone, but it is even worse for people to lose their jobs when they have to service their car loans, private housing loans and an exorbitant lifestyle.

I don’t know why is it that some of these highly-paid executives just do not save since I have never been in the shoes of someone who is paid five figures a month. Haven’t they heard of the phrase ‘When Unmanaged, Expenses Always Exceed Income Levels’? I’m pretty sure they have, but why is it that they don’t bother to manage their own finances, when they have the capabilities to manage teams of people.

The simple answer to that may be the desire to achieve instant pleasure. Humans are short-sighted in nature and when we want something, we want it now. We seldom think about what happens after we get what we want now. For some teenagers, they took up smoking or even drugs because they just wanted to try it then without thinking about the future. For people who pile up credit card debts, it boils down to the same desire for instant pleasure, while ignoring the consequences.

A more drastic lack of self-control results in crime. To be honest, most crime is stupidly carried out and makes people wonder why is it carried out in the first place? For example, the penalty for rape is so much harsher than theft. Why can’t a rapist just steal enough money for a prostitute? He gets to take his pick of girls and also face a lower jail term if he is caught. Among all criminals, I happen to hate rapists the most.

However, I think that fundamentally, it boils down to lack of self-control and to seek quick pleasure at that point of time. Isn’t it the same for the rest of us? Sometimes, we just splurge on something and regret five minutes later. Is this due to lack of proper budgeting or even if we do our budgeting, will we still be unable to control ourselves when faced with material wants?

What is your view on budgeting? Is the lack of budgeting the main cause for poverty or do you think that it is the lack of income?