By Andrew Mason

A few years ago, I wrote a blog about Financial Abstraction—the idea that as money becomes less tangible, our behaviors around that money change in ways we usually don’t notice. When a purchase is a tap of a card or a click away, the psychological weight of spending diminishes. This makes sense but isn’t exactly news, either. Retailers have leveraged technology and consumer habits for years.

The Rise of Financial Abstraction

My old blog focused mostly on spending habits and the importance of making financial consequences visible. But the idea of Financial Abstraction—that we spend and act differently the less real that spending feels—has stuck with me as I’ve watched this principle permeate American culture and impact the pockets of Americans. Economist Kyla Scanlon has written extensively on how sports betting apps, prediction markets, meme stocks and cryptocurrency markets have surged in popularity, particularly among young people.

It’s this dangerous combination of Financial Abstraction and speculative markets that should give us pause. It’s one thing to use ApplePay at the grocery store because you left your wallet in the car; it’s another to make a deposit to Kalshi and “predict” who will win the Oscar for Best Supporting Actor, all within 30 seconds.

Ms. Scanlon writes in the Wall Street Journal about Financial Nihilism: that speculative markets have filled this void in part because Gen Z and Millennials feel left behind. She believes the traditional methods of building wealth won’t work for them.

Building Wealth Without the Gamble

But the good news is, the fundamentals still work. They feel boring compared to the dopamine drenched platforms popular today. A long-term plan that includes consistent contributions and compounding still leads to successful outcomes, without putting your financial future at risk.  We encourage you to read the pieces linked below, and if any of this resonates, please give us a call. The get-rich-quick noise is louder than ever. Helping people cut through it, become more educated and create sound plans and results, is what we’re here for.

Check out Kyla Scanlon’s Wall Street Journal piece, “Why My Generation Is Turning to ‘Financial Nihilism'”, and her Substack deep-dive, “Gamblemerica: How Sports Betting Apps Rewired a Generation’s Relationship to Risk”.

If you have questions, don’t hesitate to reach out to your Fiduciary Investment Advisor.