I was listening to "The Psychology of Money" by Morgan Houseland there are instances that relate to the broader concept of psychological reactance, particularly in the way people react to financial advice or perceived constraints on their financial decision-making.

Reactance is an interesting psychological theory.

What is Reactance?

Psychological reactance is a motivational reaction to offers, persons, rules, or regulations that threaten or eliminate specific behavioral freedoms. Reactance occurs when a person feels that someone or something is taking away their choices or limiting the range of alternatives.

Developed by psychologist Jack Brehm in 1966 through his theory of psychological reactance, it suggests that when people experience a restriction in their freedom, they strive to regain it, often by pushing against the perceived constraint. This can manifest as doing the opposite of what is being suggested or increasing their interest in the restricted behavior.

Examples from The Psychology of Money

One such implicit example could be drawn from the discussions on personal finance where Housel emphasizes the importance of personal history and individual psychology in shaping one’s financial behaviors.

He explains that people often resist conventional financial advice if it conflicts with their personal experiences or emotional beliefs about money. For instance, someone who has lived through economic instability might excessively save or distrust financial markets, showing resistance to typical investment advice advocating for market-based savings.

Housel also discusses how personal pride and the desire for independence can cause people to react against sound financial strategies. This can be seen in cases where individuals reject low-risk, long-term strategies because they want to forge their own path or achieve quicker results, demonstrating a form of financial reactance where they resist because they perceive their financial freedom as being threatened.