The Psychology of Cutting Back

I was working out during the lunch hour, listening to the Tom Sullivan radio show. Sullivan brought up an interesting point about how we're being blasted by the media about how bad things are. Companies are also out there trying to get their hands on "bailout money," and sounding alarm bells. I know I've caught this "cutback fever" where I'm looking at my expenses and wondering what I could eliminate or reduce.

But why? My income is higher than it was last year. My bills are about the same as they were last year. Maybe they're a little less, actually. There is money left over at the end of the month and I find myself at the casinos, out to eat, and running around as always. Yet, here I am switching from bottled water to tap water and cutting back on Starbucks.

Sullivan called it the psychology of cutting back. We feel that we have to join in to the crowd mentality. But is there any real reason to?