1867: Your Brain on Money: The Science Behind Your Last Impulse Purchase

Summary

---

Episode Overview

Title: Your Brain on Money: The Science Behind Your Last Impulse Purchase
Podcast: So Money with Farnoosh Torabi (Episode 1867)
Guest: Professor John Dinsmore, Author of The Marketing of Debt
Air Date: August 18, 2025

This episode delves into the fascinating intersection of neuroscience, psychology, and money management. Host Farnoosh Torabi is joined by behavioral marketing expert and Wright State University professor John Dinsmore, whose latest book explores how marketers take advantage of our brains’ impulse and optimism, especially regarding debt. Together, they unpack why we consistently make money decisions that don’t serve us well—discussing the underlying biology, psychology, and clever marketing that drive our habits.

---

Key Discussion Points & Insights

1. Why We Get Into Debt—Against Our Better Judgment

• Biological & Psychological Influences:
  • Our brains are hardwired for optimism, often tricking us into believing our financial futures will be better, making present-day borrowing seem less risky.
  • “We tend to think, even though I don't have extra money now and I never have before in my life, I'm sure in a couple years I'll be making a lot more money.” – John Dinsmore [07:36]
• The Optimism Trap:
  • Optimism is vital for enduring hardship but often misleads us into underestimating challenges like future debt.
  • “Optimism is definitely helpful... but it can be expensive when we're thinking about what we think our finances are going to be like in the future.” – John Dinsmore [08:30]
• Marketers Use Our Blind Spots:
  • Marketing strategies exploit these biases, positioning debt as a solution or a status tool.

2. Status, Debt, and Marketing Tactics

• Debt as a Status Symbol:
  • Credit cards, even those targeting lower incomes, are branded with aspirational names such as ‘Platinum’ and ‘Diamond’ to invoke status.
  • Flashing a premium card, regardless of its actual terms, triggers a psychological desire to display status—sometimes at high cost.
  • “When someone... has one of these status branded cards, they like to use them more often in front of other people... and they tend to spend more as a result.” – John Dinsmore [03:09, 13:16]
• Evolutionary Psychology & Modern Consumption:
  • Our impulse to buy status items (cars, luxury goods) can be traced back to ancient drives to attract mates or signal worth within a “tribe.”
  • Quiet luxury is on the rise—signaling status to an in-group without obvious logos, as seen in modern media and elite culture.
  • “If you were in that club, you knew that was like a million dollar watch.” – John Dinsmore [17:16]

3. Youth, Education, and the Burden of Early Financial Decisions

• Naïveté & Risk in Early Adulthood:
  • Young people are especially vulnerable—high optimism, low experience, and being thrust into consequential decisions like student loans.
  • “We're asking 18-year-olds to make huge financial decisions.” – John Dinsmore [12:25]
  • There is a generational impact—parents often co-sign loans, extending risk and stress.

4. How Money Changes Us: Research and Findings

• Dinsmore’s Study: Money, Power, and Generosity
  • Handling larger denominations ($20 bills) increased testosterone and decreased generosity in men.
  • “When people experience a rise in status, they often become less generous.” – John Dinsmore [24:30]
  • Money provokes physiological and behavioral change—mirroring how power dynamics alter conduct in sociological and evolutionary contexts.
• Charitable Giving & Gender Differences
  • Research shows higher-status individuals donate a smaller percentage of income, but women tend to be more empathic and generous than men.
  • “Women are much more empathic and think about others more so than men.” – John Dinsmore [28:10]
  • The conversation highlights philanthropists like MacKenzie Bezos as examples.

5. Social Consequences of Financial Success

• Guilt and Social Tension
  • Sudden wealth can produce “survivor’s guilt” and strain relationships within families or communities.
  • “It feels weird to be wealthier than my parents... I want to give it all away.” – Farnoosh Tarabi (paraphrasing the story of a listener) [31:52]
  • Many successful individuals report pushback or isolation as they surpass their peers' socioeconomic status.

6. The Core Takeaway: Money as an Amplifier

• Money tends to amplify existing traits—generosity, empathy, greed, etc.—rather than change them entirely.
• “Money makes you more of who you are. More money makes you more of who you are.” – Farnoosh Tarabi [29:21]

---

Notable Quotes & Memorable Moments

| Timestamp | Quote | Speaker | |-----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------| | 03:09 | “When someone... has one of these status branded cards, they like to use them more often in front of other people... and they tend to spend more as a result.” | John Dinsmore | | 07:36 | “We tend to think, even though I don't have extra money now and I never have before in my life, I'm sure in a couple years I'll be making a lot more money.” | John Dinsmore | | 08:30 | “Optimism is definitely helpful... but it can be expensive when we're thinking about what we think our finances are going to be like in the future.” | John Dinsmore | | 12:25 | “We're asking 18-year-olds to make huge financial decisions.” | John Dinsmore | | 13:16 | “Status branded credit cards... they like to use them more often in front of other people whose opinion they care about and they tend to spend more as a result.” | John Dinsmore | | 17:16 | “If you were in that club, you knew that was like a million dollar watch.” | John Dinsmore | | 24:30 | “When people experience a rise in status, they often become less generous.” | John Dinsmore | | 28:10 | “Women are much more empathic and think about others more so than men.” | John Dinsmore | | 29:21 | "Money makes you more of who you are. More money makes you more of who you are." | Farnoosh Tarabi | | 31:52 | “It feels weird to be wealthier than my parents... I want to give it all away.” | Farnoosh Tarabi |

---

Timestamps for Key Segments

• Debt as Status, Marketer’s Role – [03:09, 13:16]
• Decision-Making Biases and Youth – [07:36, 12:25]
• Debt’s Social and Familial Roots – [09:18]
• Money and Biological Impact on Generosity – [24:30]
• Status, Wealth, and Quiet Luxury – [15:36, 17:16]
• Guilt and Social Implications of Wealth – [31:52]

---

Final Thoughts

Farnoosh and John’s conversation makes it clear that understanding our financial behavior requires more than math or willpower—it involves un-learning evolutionary instincts, identifying psychological blind spots, and seeing through clever marketing ploys. The episode challenges listeners to critically examine their beliefs and habits around money, offering evidence that simple awareness can be the first step toward smarter, more empowered financial choices.

Book Mentioned:

• The Marketing of Debt: How They Get You by John Dinsmore

TEDx Talk:

• John Dinsmore’s talk on how money changes us (link shared by Farnoosh)

---

Transcript

[Farnoosh Tarabi]

Looking for a high yield savings account or car insurance. I've curated my go to financial tools all in one [e-mail] these are the resources I trust presented in partnership with Money magazine. So Money Links is no overwhelm, no fluff, just solid vetted options to help you save more and stress less. So moneylinks.com check it out.

[Verizon Advertiser]

Popsicles, sprinklers, a cool breeze. Talk about refreshing. You know what else is refreshing this summer?

[Farnoosh Tarabi]

A brand new phone with Verizon. Yep.

[Verizon Advertiser]

Get a new phone on any plan with select phone, trade in in MyPlan and lock down a low price for three years on any plan with MyPlan. This is a deal for everyone whether you're a new or existing customer. Swing by Verizon today for our best phone deals. 3 year price guarantee applies to then current base monthly rate only. Additional terms and conditions apply for all.

[Farnoosh Tarabi]

Offer.

[John Dinsmore]

Race the rudders. Race the sails. Race the sails. Captain, an unidentified ship is approaching over Roger, wait. Is that an enterprise sales solution?

[LinkedIn Advertiser]

Reach sales professionals, not professional sailors. With LinkedIn ads, you can target the right people by industry, job title and more. We'll even give you a $100 credit on your next campaign. Get started today at LinkedIn.com campaign terms and conditions apply.

[Farnoosh Tarabi]

Lately, I've been turning to Quince for just about everything. Clothes for me, pieces for my kids, even stuff for the house. If you don't know Quince yet, they make high quality, timeless wardrobe staples like cashmere sweaters, linen sets, silk tops and denim for a fraction of what you'd pay elsewhere. And with this late summer heat wave, I just picked up some new linen tops and bottoms because I was running out of the good stuff. Everything from Quince fits beautifully and feels amazing. Light, breathable and effortlessly polished. I also grabbed a few new bathing suits for my daughter who's growing faster.

Than I can keep up.

The quality is just as good, if not better than more expensive brands. And that's the beauty of Quint. They work directly with top factories, cut out the middlemen and pass the savings to us. Most pieces cost half as much as similar luxury items, and they're made with premium fabrics in safe, ethical factories. Elevate your fall wardrobe essentials with Quince.

Great.

Go to quince.com somoney for free shipping on your order and 365 day returns. That's Q-U-I-N-C-E.com somoney quince.com somoney the psychology of Spending and why Our brains misunderstand debt.

[Podcast Narrator]

You're listening to so Money with award winning money guru Farnoosh Tarabi. Each day get a 30 minute dose of financial inspiration from the world's top business minds, authors, influencers and from Farnoosh yourself. Looking for ways to save on gas or double your double coupons. Sorry, you're in the wrong place. Seeking profound ways to live a richer, happier life. Welcome to SO Money.

[John Dinsmore]

If you look around now at credit card offers, you will see a lot of like prepaid credit cards or higher interest credit cards for people with lower incomes that are branded platinum and diamond and all these things. And what researchers have found is that when someone has particularly someone of lower means, if they have one of these status branded cards, they like to use them more often in front of other people whose opinion they care about and they tend to spend more as a result.

[Farnoosh Tarabi]

Welcome to so Money everyone.

I'm Farnoosh Tarabi.

Ever wonder why we take on debt knowing it's going to cost us? Or why flashing a credit card at dinner with friends can feel like flashing status? It's not just bad math or bad habits. Its biology, psychology and marketing all tangled together. And in today's episode, we're gonna unpack all of that with Wright State University professor and author John Dinsmore, whose new book the Marketing of How they get yout breaks down the subtle and not so subtle ways that marketers capitalize on our optimism, impulsivity and desire for status. We talk about why our brains underestimate the pain of future debt, how credit card companies brand products to play on our egos, why having more money can actually make us less generous. John's own research found that simply touching $20 bills increased testosterone and reduced charitable giving. Let's get into it.

John Dinsmore, welcome to so Money.

[John Dinsmore]

Hey, great to be here. Thanks for having me.

[Farnoosh Tarabi]

Yeah.

I am so excited for this conversation. I so appreciate when we can marry the world of science with the world of money. And this is an intersection that you have been immersed in for many years as a professor, as a research before we get into it, because you have so much important research you want to unpack about the marketing of debt, the neuroscience behind how we are attracted to sometimes debt unknowingly. And then of course, you've done other research on how money could potentially change us. I want to talk about that. That's super interesting. How did you, John, arrive at this body of work? Were you the kid, the young adult who was always fascinated by the world of money and an academic how did, which came first?

[John Dinsmore]

This is a second career for me. So I worked in marketing for tech companies and I worked for a real estate company. And then about a week after Lehman Brothers fell, if you remember back then the company I worked for, we had a conference call saying the good news is you have jobs, the bad news is we can't pay you. So I had always. Right. I mean that was kind of my take. Yeah, yeah. So going back to grad school is never convenient when you're out of a job or a paycheck at least. Right. It's a lot more convenient. And I had always thought I wanted to do this because I'd always just found it very interesting reading different academics and marketing and behavioral research. So then went back and got my PhD and I gravitated toward financial decision making, I think because it's hard and I've. I have an MBA and a PhD in business and I still find it hard.

[Interviewer/Host Assistant]

Right? Yeah, yeah.

[John Dinsmore]

And I think a lot of people get into behavioral research. They're trying to figure themselves out in the process. And I think for me, I was trying to figure out why is this so difficult? I've taken a million finance classes, I should understand this better than most. And yet I'm still just face planting all the time trying to make the right decision.

[Farnoosh Tarabi]

And what I love about this field is that it's relatively new when you think about how long money has been around, how long science and academics has been around. But I think it was maybe not since, I don't know, the 90s, there was a Nobel Prize, behavioral economics, Daniel Kahneman. And that kind of brought more attention to this field of hey, maybe we're messing up with our financial decisions not because we're bad people or we can't understand it, but there is actually a hard wiring, in some cases a sort of neuro situation going on. And I want to get to your book the Marketing of Debt. What inspired you to focus on debt as your work is broad and it looks at financial decision making. But this piece of it, the debt piece, why now?

[John Dinsmore]

Debt is something that combines a number of aspects of decision making that are prominent weaknesses for people.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

In the book I try and break down different aspects of the debt decision and it includes things like, all right, looking into the future, so when, because to take out any sort of credit you have to think about in the future, will I be able to pay this off? And there's a lot of once we start considering things in the future versus the present, we are subject to a lot of biases and blind spots. We tend to think, even though I don't have extra money now and I never have before in my life, I'm sure in a couple years I'll be making a lot more money. We tend to think that everything's going to work out, my ship's going to. And all these. These are just a lot of things that cause us to make bad decisions.

[Farnoosh Tarabi]

So is it to say that having some pessimism is really helpful when it comes to financial decision making? To underestimate a little bit? Although I want to appreciate our optimism, but in the world of money, it doesn't always serve us.

[John Dinsmore]

Optimism is definitely helpful for us to just keep on living our daily lives or getting through any sort of hardships, but it can be expensive when we're thinking about what we think our finances are going to be like in the future. So our tendency is to overestimate our ability to pay and underestimate the challenge of being able to handle debt.

[Farnoosh Tarabi]

And marketers know this.

[John Dinsmore]

Marketers know this.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

It's. While there's probably some aspects of the book that can feel a little conspiratorial, I don't think that banks or marketers at banks are always trying to think about how they can manipulate us. But there's a lot of common marketing appeals that play into some of our worst instincts and impulses when it comes to these decisions.

[Farnoosh Tarabi]

Yeah. And I've often heard from people that, for me, I grew up in a cycle of debt. My parents were always using debt as a lifeline, and they believe, they truly believe that debt is just part of life. And what would you say to those folks? Like, they are actually doubtful, they're not optimistic that they can break out of the debt cycle.

[John Dinsmore]

Debt is a part of life in the sense that sooner or later, one of the things I look into is people avoid learning about interest rates and debt in general as much as possible. The same way they would want to avoid learning about, like, nuclear physics.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

It's complicated, it's over my head. But the difference between debt and nuclear physics is that you're going to be forced to deal with debt at some point.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

I agree with the notion that you're going to have to deal with it. Debt is part of life. Student loans, mortgages, car loans, all these things.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

But you don't have to surrender to just, I'm going to live my life under the thumb of the banking industry. It's. You don't have to be an indentured servitude. There's things you can do to make better decisions and reduce the cost of debt.

[Farnoosh Tarabi]

Are there red flags to look out for when you are taking on debt, especially for a young person to really get, get a grip on this? Because it might not be. It's all new to them.

[John Dinsmore]

It is. And unfortunately I talked about optimism and research shows that the younger you are, the more optimistic you tend to be. So you take that there's very high levels of optimism and then you put them in front of when we're talking about student loans, making long term financial commitments, about going to college and all right, I'm going to invest this much money in an education, but I'm not sure what I want to do or if I'll be good at it or if I'll like it. It's a rough proposition for a lot of college students. Part of it is the cost of college, but the other part of it is it's ridiculous. I think that we're asking an 18 year old, say, take on $100,000, no credit history.

[Farnoosh Tarabi]

Right.

[John Dinsmore]

And to try and learn something that you don't know if you're going to want to do it for any period of time.

[Farnoosh Tarabi]

There's no collateral, there's no guarantee of a return and often it brings the parents or the caregivers into the fold because then they have to co sign and then it's making this other generation vulnerable and on the hook for this debt.

[John Dinsmore]

So I will be 53 in June. I just paid off my student loans.

[Farnoosh Tarabi]

No way. But you went to grad school later.

[John Dinsmore]

Right. So I went back, I was like 37 when I went back to school to get my doctorate. But at the same time it's still wow. If I. So yeah, I think it is. It's a big constraint placed on people and I think unnecessarily so.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

So a lot of times we think making good decisions is just about being smart enough or knowing enough. And the truth is it's about a lot more than that.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

We have to be in the right state of mind, we have to have the right information and we have to be in a situation where it's optimal for decision making.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

And all those factors rarely align and the younger you are, the less likely they are to align for you to make a good financial decision. And yet we're asking 18 year olds to make huge financial decisions.

[Farnoosh Tarabi]

Yeah. And talk also about debt in the context of status building. So debt has often been looked at as a tool to get further along in life and heighten your status Whether that's because you want to get the college degree and heighten your status in the professional world, you want to take on a mortgage to buy a bigger home, you need a car loan to look good in your car. So I think there's also that. And I wonder what your, what the science talks about our need as humans to feel at a certain status level. It's like what we say, like keeping up with the Joneses and we'll do it at any cost, even if it means indebting ourselves.

[John Dinsmore]

So where status building is concerned, it makes me think of a couple of things. So one of the chapters in the book is on status branded credit cards.

[Farnoosh Tarabi]

Yeah.

[John Dinsmore]

And there's a lot of research to show that we're. If you go back to the original American Express gold card, when that came out, that was a credit card that was status branded but legitimately for people of higher means. And it was something, if you flashed a gold card and later a platinum or a black card, it was like a neon sign saying that you were rich, had resources, whatever. But if you look around now at credit card offers, you will see a lot of like prepaid credit cards or higher interest credit cards for people with lower incomes that are branded platinum and diamond and all these things. And what researchers have found is that when someone has particularly someone of lower means, if they have one of these status branded cards, they like to use them more often in front of other people whose opinion they care about and they tend to spend more as a result. Now was this originally the idea of the credit card companies? I don't know. But over time it's your job as a marketer to say, hey, which cards are doing better than others and with who? And then on one other thing it made me think of, there's the notion of evolutionary psychology. Right. It goes back to when we were. What behaviors and biases do we have today that trace back to when we're living in caves and trying not to be eaten by T. Rexes? And so there have been some studies about how do people behave in front of others when it relates to status.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

And so when people, it's, it's not just when using a certain type of credit card, but there was a study with men and in the presence of women wanting to buy more status branded goods. We are hardwired to try and find a mate to try and impress a perspective mate. And so people, it results in preferring higher end brands. Sure, driving a Porsche is nice and I'm sure it's a great ride, but at the same time, it's doing a lot more for you than just getting you from point A to point B. Yeah. It's sending a message to a lot.

[Farnoosh Tarabi]

Of people at the same time. Do we have this trend of quiet luxury? So it's so confusing to know if you are someone who's seeking status, what.

[John Dinsmore]

Are you doing, you know, so well and so you say the trend of quiet. Could you explain that to me?

[Farnoosh Tarabi]

Oh, sure. So this kind of came out, I would say. Do you ever watch Succession?

[John Dinsmore]

Yeah. Yeah.

[Farnoosh Tarabi]

So there was a lot of fashion analysis on that show as they represented the top echelon of rich people in the world. And what they found was that they wore a lot of muted colors, especially the women, the sis, the young, the daughter in the show who wore a lot of taupe and beige and no labels. Like you didn't see them walking around with Gucci or Louis Vuitton. Like they were very discreet. They were almost above it all. They were above the labels, but they still insisted on wearing $300 T shirts. And it has actually trickled down to the mass market where if you look at what's popular right now, at least in women's fashion, it's a lot of muted colors, taupes, whites, basics. I think because of the influence of that quiet luxury, that again, it's like there is almost like a backlash now to wearing a lot of the brand names out loud. So anyway, that's just the background on that. And I wonder, as someone who's navigating all this, it's gotten to be like quite confusing. What am I supposed to do if I want status? Do I do this, do I do that? If that's your goal, obviously.

[John Dinsmore]

So I would think those. There are brands of what, cars and handbags and all these things that, I mean, to someone like me, I have no idea a Ferrari is going to send a loud and unmistakables symbol. But I forget the brand of watch that Mark Zuckerberg did some interview.

[Farnoosh Tarabi]

I couldn't. I know what you're talking about. I don't remember the name brand.

[John Dinsmore]

I never heard of. And I couldn't tell just by looking at it that it was expensive. But if you were in that club, you knew that was like a million dollar watch.

[Farnoosh Tarabi]

They're impressing, not us. They're impressing, sort of. They're a small group of billionaires. Fellow billionaires.

[John Dinsmore]

Yeah. I think they're trying to avoid attention from maybe a crowd that they don't want to affiliate with, perhaps attract attention with people who are in the club.

[Farnoosh Tarabi]

Was it Jay Z? I think it was Jay Z who said there's always another level. And you mentioned the gold card, but then there was the black card and it just like goes on and on. I don't know what's next, but we'll figure it out. The marketers.

[John Dinsmore]

Yeah, yeah, absolutely. Louis Vuitton, right? It's amazing what they. Now I'm cheap, so it's never going to make sense to me. But you see the prices that they get. Yeah, I would not think it's a good idea, but the Louis Vuitton, you're not paying. Always doing well.

[Farnoosh Tarabi]

You're not paying for the craftsmanship or the leather. Let's just put it that way. I mean, it's fine. You're paying for the label.

Lately, I've been turning to Quince for just about everything. Clothes for me, pieces for my kids, even stuff for the house. If you don't know Quinn Quince yet. They make high quality, timeless wardrobe staples like cashmere sweaters, linen sets, silk tops and denim for a fraction of what you'd pay elsewhere. And with this late summer heat wave, I just picked up some new linen tops and bottoms because I was running out of the good stuff. Everything from Quince fits beautifully and feels amazing. Light, breathable and effortlessly polished. I also grabbed a few new bathing suits for my daughter, who's growing faster.

Than I can keep up.

The quality is just as good, if not better than more expensive brands. And that's the beauty of qu. They work directly with top factories, cut out the middlemen and pass the savings to us. Most pieces cost half as much as similar luxury items and they're made with premium fabrics in safe, ethical factories. Elevate your fall wardrobe essentials with quince. Go to quince.com sewmoney for free shipping on your order and 365 day returns. That's Q-U-I-N C E.com SewMoney quince.com SewMoney Would you rather sit through a zoom call that could have been an email or. Or shop for car insurance? Both painful, but only one has Jerry to fix it. Jerry simplifies the entire car insurance shopping process. Start to finish. Just answer a few easy questions once and Jerry compares quotes from over 50 top rated insurers side by side. No endless forms, no jumping from site to site. And this is the key. No sales calls. I've used Jerry to compare rates against my current policy. And wow, the time saved alone is worth it. They even help cancel your old policy for you switching couldn't be easier. Stop needlessly overpaying for car insurance. Drivers who save with Jerry save on average $110 a month. That's more than $1,300 a year. So before you renew your policy, do yourself a favor. Download the Jerry app or head to Jerry AI somoney. In just a few minutes, you can compare quotes and coverages side by side from up to 50 top insurers. Jerry Car Insurance Made simple and finally on your side, based on drivers who switched and saved with Jerry over the past 12 months, over 20% of drivers who switch with Jerry found a monthly premium of $87 or less. Not all drivers find savings. You know that feeling when it's midnight and your brain just won't shut off the to do list, Tomorrow's meetings, the million things on your plate. That's me most nights until I tried bowl and Branch My husband and I both tend to overheat at night, especially during these warm summ summer months. But since switching to Bolen Branch's Per Kale sheets, our sleep has totally transformed. They're light, crisp and incredibly breathable. Honestly, it feels like slipping into a perfectly made hotel bed every night. What I love most is how they're made. 100% organic cotton, no toxins, and crafted by artisans who are paid fairly. And they come with a 30 night worry free guarantee. So you can really feel the difference. I noticed it the first night how soft and cool the sheets felt and with every wash they just keep getting better. Feel the difference an extraordinary night's sleep can make. With Bolen Branch, get 15% off plus free shipping on your first set of [e-mail] SewMoney that's Boland Branch B O L L A N D branch.com SewMoney to save 15% and unlock free shipping, exclusions apply.

[Monday.com Advertiser]

Oh, I'm not switching my team to some fancy work platform that somehow knows exactly how we work, and its AI features are literally saving us hours every day. We're big fans. And just like that, teams all around the world are falling for Monday.com with intuitive design, seamless AI capabilities, and custom workflows, it's the work platform your team will instantly click with. Head to Monday.com, the first work platform you'll love to use.

[Farnoosh Tarabi]

Okay, this transitions us nicely because we were talking about status and even cavemen, which kind of parlays us nicely into a TED a TEDx talk you gave two years ago on the topic of how money changes us Tell us first the research behind this and then the thesis that you ultimately came up with. But how did you go about exploring this dynamic?

[John Dinsmore]

I had become friends with someone who did research in the field of the evolutionary psychology. And so I read a study that he did that showed that if you accept the premise that we're designed to pursue a mate and procreate, at some point he decided to look at women's ovulation cycles and their choice in wardrobe and found that when women were ovulating, they were. They tended to wear brighter colors to attract more attention. And they were completely unbelievable. We're doing this, right? It's crazy, right? And then the other thing that I had read that made me think of doing the study we did was someone did a study where they would have one group. If you remember that old game mousetrap, right? It has the very elaborate, all the pieces. They would have one group assemble a the game mousetrap. They would have another group disassemble and assemble a gut. And then afterwards, they would ask each group, hey, someone who was here before you left, a shot glass of water with some amount of hot sauce in it, right? So drink the shot of hot sauce and water, and then we want you to put hot sauce in for the next person, right? And so the hot sauce was a proxy for aggression. The more hot sauce you would put in it, the more you wanted to mess with the next person who would come. And so what they found was the people who handled the gun had put a lot more hot sauce in the water than people who were. So in my mind, I thought, what is a gun about? To me, I think power is at least one of the things that it's about. So I thought, if a gun will do that, money is also about power. I got together with my friend who did the ovulation study and said, let's look at handling money and see how it changes people's behavior.

[Farnoosh Tarabi]

Okay?

[John Dinsmore]

So we looked at hormones. We just did men, and I won't bore you with all the reasons women do have testosterone, but in different levels and so on. But so we got all of these men, and some were given stacks of blank paper in the dimensions of dollar bills. And so they had to handle that and do different things with it. And then other people were given stacks of $20 bills, right? And then we actually did another group with stacks of $1 draws. And so what we found was. And then afterwards, we asked them to, here is your compensation for doing the study. Would you like to donate any of it to charity? And so what we found was the people who had handled the $20 bills were less likely. First, they experienced a rise in testosterone when they came in. We had everyone drool into a cup so we get their saliva to test for testosterone. And then after they did all this, we had them give a second sample. So what we found was people handled $20 bills, their testosterone went up, and they became less likely to donate to charity. They became less generous versus the people who handled the paper or even people who handled the $1 bills. It was an effect contingent upon a significant amount of money. From that, you can say that when people experience a rise in status, they often become less generous. So, yeah, and that's in going back to the caveman context, we were able to evolve as a species not because we competed with each other, but because we cooperated with each other. We needed each other to survive, to share resources, food, shelter, animal skins, whatever. But the higher up in status you became, the less you had to cooperate with people because those resources were flowing to you. So if you accept that dynamic. So today, instead of we're all not hunting for our food, but money is the gateway to all these resources. So when we start to acquire more resources, we become less concerned about sharing with others. Not always. Not every person, but on average.

[Farnoosh Tarabi]

That's really interesting. So were you surprised by the findings? Did it. Does it track with your life experience? I'm just curious how off or on target it was.

[John Dinsmore]

In my life experience, I've known people with significant means. Some were generous, some were not. As one of the things. One of the limitations of the study is we were doing this all with poor college students.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

So we were dropping a bunch of money in the hands of prefunctal cortexes.

[Farnoosh Tarabi]

Aren'T all developed fully, let's just say.

[John Dinsmore]

Yeah, there's that.

[Farnoosh Tarabi]

Especially the Met. Yeah.

[John Dinsmore]

So we were dropping status and resources on people who had been deprived of it. It could be that maybe if people grow up with it and they're more acclimated to it, maybe they're more likely to generous. I mean, in my experience, if you look at the statistics on charitable contributions, typically the people with the most resources as a percentage of income donate are less charitable.

[Farnoosh Tarabi]

And that's usually met. I love that statistic only because it shines a light on one of the strengths that women have in terms of their generosity. And I love that correlation, which is it feeds my self interest, because I'm here to try to help more women get rich. And I want to say, I want to make the Claim that when women make more, the world becomes a better place. And that's not just hyperbole. Like we actually have the science and the data to show the science and also the research of charitable contributions to show that actually is generally true. Would you agree?

[John Dinsmore]

We didn't include women in our study because it's very expensive to get testosterone levels on people. And so we couldn't afford to do enough men and women. But I will tell you that the research on women, one of the things I've read, if you think women are more empathic, not just more willing to consider the other person's position, but more capable of it, research backs that up on average women are much more empathic and think about others more so than men. And if you. From like a neurochemical perspective, testosterone is considered like the chemical fuel for competition.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

And men, I can see the argument of testosterone leading to. When you get lots of money, your testosterone goes up. And so especially for men, maybe less considered or less willing to do that. We were talking before we started this about Mackenzie Bezos now.

[Farnoosh Tarabi]

Yes.

[John Dinsmore]

And she's doing amazing things, is giving away incredible amounts of money. And Jeff Bezos has done some really nice things out there, but is not nearly on the same scale as him. Now, is that just a typical gender difference? It's a sample size of two people, but it's. It could be an example of that.

[Farnoosh Tarabi]

Yeah. One thing I've said often on this podcast is that money makes you more of who you are. More money makes you more of who you are. And that's not to say it makes you happier or sadder. Those are states of mind. But actually at the core, if you are, for example, more a generous disposed to generosity, more disposed to being empathetic or a helper, and contrastly, like not a helper, greedy. I think that money can be a tool. As I've seen it 20 years of working with people and studying money, that it can has the tendency not always to amplify who you are at the core. And at the end of the day, that's your choice. Right. It's not a subconscious thing. You can choose better or worse with your money. But there is that potential because like with Mackenzie Bezos, like, how is that. Whereas her husband is not maybe as publicly generous as, let's just say, I don't know, all of his philanthropic portfolio. But could it be that prior to becoming rich, she was someone who was generous with her time, with her advice, with her patience, and now with money, there's just another way to Express that generosity. I don't know. I would put money on it though.

[John Dinsmore]

And we were talking about before, right? Amazon would not exist without her. The non spouse will say, you know what, honey, quit your job, follow your dreams. I will make it work while you do that. So there's. That's suggestive of someone who's fairly generous and thoughtful about other people. Yeah, I think another thing, another example, just popular culture that pops into my head is, but most lottery winners end up broke in a few years. So part of it is a lot of these folks are not very experienced in how to manage money and that sort of thing. I think the other part of it is there's probably a lot of naivete and trying to help people.

[Interviewer/Host Assistant]

Right.

[John Dinsmore]

All of a sudden, all the people they know, they want to help. And whenever I read stories about people in that situation, they would hear about someone in town that they knew who needed open heart surgery, so they wrote the check.

[Farnoosh Tarabi]

And it's guilt also associated with getting rich fast. Not to interrupt you, but I think part of it, they feel guilty, they're guilted into it as well as they want to be helpful. But I often hear from people who, especially the get rich quick folks who weren't looking, they weren't expecting to get wealthy. They won a lottery or they, their company IPO'd and now they have millions in the bank. Some, not all. They write to me, they're like, I feel icky.

[John Dinsmore]

Oh, wow.

[Farnoosh Tarabi]

Yeah, I feel, I mean, it makes sense.

[John Dinsmore]

It's like a survivor's guilt, right?

[Farnoosh Tarabi]

Yeah, yeah, I think because again, survival is relative, right? Survival in your world. Right. So if the woman, for example, she actually wrote an article about it in New York magazine, her company ipod, she was having a lot of guilt and bad feelings about being suddenly rich overnight. Why? Because for. In front of the people she cared about most, her family, her parents, they were making her feel bad about it. Oh, you think you're better than us now? O you think? And she's. It feels weird to be wealthier than my parents. That's never happened generationally like. And I don't know how, what to do with this money. I want to give it all away. And it took everything in me to not find her address and look her up and go to her house and tell her that she, she has every right to keep this money. And it's not. She doesn't have a money problem. She has a family problem.

[John Dinsmore]

And again, it's going to depend on the person in the situation. But I think probably something that's very common, even if it's not extraordinary wealth or something like that. Is if someone becomes very successful, they start getting pushback from people. Yeah, you think you're success, but they start moving on to other things and maybe they look like they're on an upward trajectory. I think there's a lot of people experience pushback from those close to them.

[Interviewer/Host Assistant]

Right?

[Farnoosh Tarabi]

Yes.

[John Dinsmore]

It's hard to see someone do better than you.

[Farnoosh Tarabi]

Yes, it is. It is in again a competitive world. This is such a fascinating conversation and thank you for ping ponging with me and going in a bunch of directions. But John Dinsmore, great work. Your book everyone. Check it out the Marketing of Debt, how they get you and I'll put the link also to your TEDx talk. I thought that was super fascinating. Congrats on the book and thanks for coming on so money.

[John Dinsmore]

Thanks for.

[Verizon Advertiser]

Popsicles, sprinklers, a cool breeze. Talk about refreshing. You know what else is refreshing this summer?

[Farnoosh Tarabi]

A brand new phone with Verizon. Yep.

[Verizon Advertiser]

Get a new phone on any plan with select phone. Trade in in MyPlan and lock down a low price for three years on any plan with MyPlan. This is a deal for everyone whether you're a new or existing customer. Swing by Verizon today for our best phone deal. 3 year price guarantee applies to then current base monthly rate only. Additional terms and conditions apply for all offers.

[Progressive Insurance Advertiser]

This episode is brought to you by Progressive Insurance. Do you ever think about switching insurance companies to see if you could save some cash? Progressive makes it easy to see if you could save when you bundle your home and auto policies. Try [e-mail] Progressive Casualty Insurance Company and affiliates. Potential savings will vary. Not available in all states.