How We Perceive Our Income

We don’t speak openly about our money – it’s “taboo”. By not discussing our actual earnings, we leave others with no choice but to make assumptions, based purely on how they see us behave with our money.

My maths teacher did an experiment with our class in high school, she wanted to know our perception of what our parents earned. 

This clever teacher understood the phenomenon, and wanted us to realise it while we were still young enough for it to make a difference: before we started earning our own salaries.

First, she asked us to guess what our parent’s salary was, and to write that figure down at the top of the page.

Next, beneath it, she asked us to draw up a budget for our parents – how they spent that salary.

She helped us with ideas of what they were responsible for paying for each month:




School fees




Phone Bill



Clothes, etc


Then she asked us to estimate what we thought our parents spent on these items each month. Then she instructed us to add up the total of the spending column. 

We found (to our surprise) that either our estimates were incorrect, or our parents needed to earn a lot more than we originally thought.

Which one do you think was right? Was it our perception of what our parents spent, or our perception of what our parents earned?  Or both?

The art of disguising our real earnings and what we can afford is something we all participate in every day – in effect we become magicians with our money.

It gives us ‘status’ to let our friends and relatives think we are earning more than we are - but behind the scenes we are struggling.


Will the truth come out one day?

How embarrassed will we be then? What will happen to our status in our community then? At some stage the magic will run out, and our peers will know we were deceiving them all this time.


Looking at others accurately:

When we see someone driving a new, flashy car, our tendency is to be jealous, and want that for ourselves. However, we know that a new car is a terrible investment – it loses over half its value over five years, and added to the interest payments it could be a really bad financial decision.

Then we can think to ourselves:

Woud they have bought the car if they’d saved up the cash? Probably not – a house is a better investment.

Did they borrow from the bank over many years? If so, how much stress are the re-payments giving them?

Have they made the choice to drive a status symbol rather than to send their children to a good school and then to a good university?

Do they make good choices, provide for their family security, own their own house?


Rules to Live by:

Live Within Your Means: Budget your income and expenses each month and don’t spend outside this plan. If you can’t afford it, then don’t buy it! It is this simple if you want to be financially well.

Understand Your Earnings: Understand what you can afford and create a lifestyle that fits comfortably in that allowance. 

Don’t try to Impress Your Peers: don’t lie to friends and family about what you can afford. Rather let them respect you for who you are as a person and your values. Guide them to be more honest and realistic about lifes affordability.

Don’t Spend What You Can’t Afford: If you can’t afford it and have to borrow so that you can have it, the future you will have to pay for it. If you can’t afford it today, how will you afford it next month, and the month after? 


Orabile Tuelo is a Debt Counsellor with S.C.I. Training (Pty) Ltd. © S.C.I. Training is a BQA accredited training institution specialising in Financial Education. We also offer Ethical Collection services for companies with debtors and Debt Counselling services for those in financial distress. For help and information contact 3180111 or 75797242 or [email protected]

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