Podcast Summary:

How to Money – Episode #1031
“Built to Borrow: The Hidden Forces Behind Debt” with Professor John Dinsmore
Air Date: September 3, 2025
Host: Joel (solo, without regular co-host Matt)
Guest: Professor John Dinsmore (Marketing Professor, Wright State College of Business; author, “The Marketing of Debt”)

Episode Overview

This episode explores the psychological, cultural, and marketing dynamics that drive Americans into debt, with a special focus on how modern financial products are marketed and normalized. Professor John Dinsmore, an expert in marketing and consumer behavior, discusses hidden influences—from persuasive advertising and behavioral biases to AI-fueled targeting and systemic financial literacy gaps. The conversation balances practical advice with a deep dive into both the dangers and legitimate uses of debt products.

Key Discussion Points & Insights

1. Why Most People Fall Into Debt

• Joel introduces the show’s mission—helping listeners overcome financial mistakes, especially debt, without shame ([01:22]).
• Dinsmore argues that debt issues are less about personal failure and more about industry practices:

  “Maybe, just maybe, your debt problems, they're not solely about a lack of willpower… [we need to] spot the marketing schemes and nefarious traps out there so we can avoid them.” —Joel ([01:22])

2. Marketing’s Real Influence on Us

• Most people wrongly believe marketing only works on others.

  “Most people think marketing works on other people, but not on me.” —Dinsmore ([05:40])

• Data shows that repeated, long-term exposure changes brand perception and behavior—even subconsciously ([06:23]).
• Stadium naming rights, digital advertising, and personal anecdotes illustrate marketing’s subtle, pervasive effects ([07:43]).

3. Why Debt Marketing Has Become So Powerful

• Tactics have grown more sophisticated with data harvesting and micro-targeting ([10:32]).
• Example: Target’s pregnancy prediction marketing was cutting-edge over a decade ago—now such practices are even more advanced ([11:18]).

  “Marketers know so much about us that everything is... very little that’s random about the ads and messages you receive now.” —Dinsmore ([10:55])

4. Good Marketing vs. Deceptive Marketing

• ‘Good’ marketing: Clear, honest communication about valuable products solves real needs ([12:40]):

  “When marketing is a force for good... it’s taking something that has real value to people, clearly and honestly communicates what that value is...” —Dinsmore ([13:03])

• The problem: Ambiguity and complexity in financial products exploit consumers’ knowledge gaps ([13:50]).

5. Financial Literacy: The Missing Piece

• Lack of early education leaves consumers exposed ([14:13]).
• Many youth make major debt decisions—like student loans—without sufficient knowledge.
• Encouragingly, 25 states now mandate financial education in schools ([16:18]).

6. The Normalization of Debt

• Culturally in the U.S., debt is not only common but seen as necessary:

  “We’ve normalized it completely... It’s like that frog in the water, and it just starts to seem normal.” —Joel ([10:01])

• Debt's normalization is driven by both relentless marketing and societal structures ([17:30]).
• The discussion likens uninformed borrowing to “putting six-year-olds behind the wheel of a car” ([18:39]).

7. Predatory & “Booby Trap” Debt Products

• Payday loans and high-interest products are especially harmful, targeting those with few options ([20:05]).
• Even consumers in desperate situations will sell plasma to avoid these lenders ([20:59]).
• There’s a case for expanding accessible, mainstream financial services in low-income communities ([22:13]).

8. Behavioral Biases and Debt Decisions

• People are naturally optimistic about their financial futures—a “prediction bias” that leads to over-borrowing ([27:09]):

  “Inherent in taking out any debt... you have to think about what your future circumstances are going to be. And we are, as a species, very optimistic.” —Dinsmore ([27:09])

• When stressed or overwhelmed, we’re more susceptible to marketing, especially via always-on digital devices ([28:46]).

9. The Role of Debt in Opportunity

• Debt products like mortgages or VA loans enable life milestones—when used wisely ([30:47]).
• The trick: Don’t fall for products you don’t understand, especially those with hidden fees or that you’re pushed into last minute ([31:55]).

10. Psychological Traps in Debt and Consumption

• Loss Aversion:
  Companies upsell extended warranties and insurance based on our fear of loss ([32:08]).
• Mental Accounting & Payment Method:
  Cash “hurts” more to spend, while credit cards (and especially phone tap-to-pay) make spending almost pleasurable—so we spend more ([35:02]).
• Buy Now, Pay Later:
  Fuels larger purchases by minimizing upfront pain ([37:44]).
• Status & Branding:
  “Status” credit cards drive overuse among lower-income consumers, especially in public situations ([39:48]):

  “People of lower incomes... use [status-branded cards] more... in publicly visible ways.” —Dinsmore ([39:48])

11. Navigating the Information Battlefield

• Trusted reviewers (like Consumer Reports) are key for discerning actual value; social platforms like Reddit can help but are being infiltrated by marketers ([44:32]).
• “You need to reacquaint yourself with these things… and crowdsource advice from true experts if you can.” —Dinsmore ([44:32])

12. AI, Internet, and Evolving Consumer Challenges

• AI and algorithmic targeting make online comparison shopping harder and more manipulative ([50:02]).
• Dynamic pricing means prices can change just for you or based on timing ([52:16]).
• “It comes down to the amount of effort you’re willing to do… check multiple sources for everything.” —Dinsmore ([52:58])

13. Who Should Protect Consumers?

• There must be a balance between consumer responsibility and government regulation ([55:07]).
• Recent regulations (like “all-in pricing” for concert and airline tickets) help with transparency ([55:50]).
• Psychological commitment increases as people move through the purchase, making hidden fees especially potent ([55:53]).

14. Personal Lessons and Actionable Advice

• Dinsmore shares personal experience: “Shopping around and being willing to walk if you have to is the biggest thing I think.” ([59:28])
• Even after beginning a process (e.g., home mortgage), it’s essential to pause, re-evaluate, and seek alternatives when terms become unfavorable ([57:19]).

15. Closing Takeaways

• Over-optimism and emotional decision-making are major risks in borrowing ([01:22], [27:09], [60:04]).
• Save “like a pessimist” and invest “like an optimist” (attribution to Morgan Housel, paraphrased by Joel, [60:04]).
• Vigilance, education, comparison shopping, and a readiness to walk away are essential tools for consumers confronted by modern marketing and complex debt products.

Notable Quotes & Memorable Moments

• “Most people think marketing works on other people, but not on me.”
  — Prof. John Dinsmore ([05:40])

• “You may think you’ve completely rationally and consciously arrived at the choice...but there’s reams of research to show...our preferences are not that set.”
  — Prof. John Dinsmore ([05:51])

• “We’ve normalized it completely… It’s like that frog in the water, and it starts to seem normal after a while.”
  — Joel ([10:01])

• “Payday loans… prey on people’s lack of sophistication but also lack of options.”
  — Prof. John Dinsmore ([20:40])

• “People tend to borrow on how much they think they’re gonna be making rather than how much they make. And that, you know, that can be a mistake.”
  — Prof. John Dinsmore ([28:03])

• “Our internal bookkeeper is heavily concussed.”
  — Prof. John Dinsmore, on emotional vs. rational money decisions ([34:39])

• “If you have a friend who works in finance, obviously that would be great… But if not, maybe crowdsource.”
  — Prof. John Dinsmore ([44:32])

• “Shopping around and being willing to walk if you have to… that’s the biggest thing I think.”
  — Prof. John Dinsmore ([59:28])

Important Timestamps

• [01:22] - Introduction of debt and marketing’s intersection
• [05:40] - “Marketing works on others, not me”—why this is wrong
• [07:43] - Brand familiarity and stadium naming rights
• [10:32] - Evolution and sophistication of debt marketing
• [13:03] - Defining ‘good’ marketing in finance
• [14:13] - Financial literacy, education shortcomings
• [17:30] - Cultural normalization of debt in the US
• [20:05] - Payday loans and economic exploitation
• [27:09] - Behavioral optimism and borrowing mistakes
• [28:46] - Impact of constant digital exposure & marketing
• [35:02] - Mental accounting, payment pain, and spending habits
• [37:44] - “Buy Now, Pay Later” — dangerous convenience
• [39:48] - Status cards and conspicuous consumption
• [44:32] - Using expert/crowdsourced reviews (and the pitfalls)
• [50:02] - Internet, AI, and dynamic pricing on consumer choices
• [55:50] - Government regulation vs. consumer responsibility
• [57:19], [59:28] - Dinsmore’s personal experience: shopping, walking away, finding better deals

Final Thought

This episode arms listeners with a deeper understanding of the subtle—and sometimes aggressive—ways debt is marketed and normalized in society. To avoid financial pitfalls, consumers must continually educate themselves, question assumptions, compare options, and avoid letting emotions dictate major financial decisions.

For more, see Professor Dinsmore’s book, “The Marketing of Debt.”

Summary by How to Money Podcast Summarizer — keeping you informed, empowered, and always a step ahead of the marketers!