Low income earners dont recognise the difference between assets and liabilities - so they spend money on artificial things, or even borrow money and buy things that will cost them money - for example expensive cars, phones etc - these are generally liabilities and depreciate in value very quickly. People who are wealthy focus there income on assets and things that will generate them income, such as property and stocks.
I think its fair to say that lower income earners (on average!) are less educated and thus wont recognise how their spending habits are affecting their wealth in the long term. Im sure it comes down to the attitude of 'I want this now', and thus they end up buying things they actually cant afford and end up further in debt
I agree with @Cryptoandcoffee, it's all about image. Having an expensive item, no matter what it is, can give them some comfort and make them believe they are more than what they really are.
This goes for housing as well. People are choosing huge houses, even if they can't afford it. It's all about image, to show off, to have more than the neighbors or friends. This is sheer stupidity, if you ask me.
All derives from the desire to be appreciated. Painting a fake picture of yourself is never good, can backfire one day.
I'd rather be what I am, choose what I can afford and be happy.
I would say it is all about image. By having these branded items they portray a side of wealth. It is very shallow thinking and maybe a fantasy land they live in.
I often see people driving expensive cars that depreciate in value but live in a average house. Why they don't have a normal car and have a better house. The problem is they can show off the car but not the house.
Rich people honestly don't care and would rather do the opposite and not flash that they have money.
They simply want to put on the appearance of been rich and influence people's perceptions of them.
Looking good and using cool gadgets from popular, expensive brands are cool. But when they are from their low earnings, they are putting up the image of been rich at the expense of been truly rich. The same reason is why many low income earners never leave the proverbial rat race.
It is more like putting cart before the horse. The truly rich are very sensible in spending that some low income earner will consider them misers. We all love good things of life. However it is better to be moderate in spending and invest the rest. The investment can then pay for the expensive brand at the right time.
Many Real rich people don't care much about other people's perceptions or putting up deceptive images at the expense of their investment seeds. Buying expensive brand instead moderate affordable ones is like making other people rich while impoverishing yourself.
Again, the rich because they understand the value of money would rather go for a car or gadgets or clothes from 'lesser' brands that are close in specifications or quality than buy an expensive items that are made so by the names attached to them.
Little drops of water, they say makes an ocean. Savings from this sort of 'sensible' purchases, buying wholesale and other bargains goes to their investments which generate more income. One of the reasons the rich are getting richer and the poor.......
Low income is usually the one with uneducated background about buying things they don't need. Therefore, they tend to spend more money to buy stuffs that just use to show off their social grade.
I don't know if that's exactly how things are. If I were to put my money on it my guess is to attract attention. If you cannot be rich, at least look rich so the rich cannot tell you're a pleb and the pleb cannot tell you're not rich.
They do say, that to be successful you need to convince other successful People that you're one of them and they will aid you.
It’s because they want to look like they have money and it makes them feel great. This is why there are so many fake designer bags etc. People with money do a lot more research also therefore buying quality over brand
I question the assumption underlying the question : whether poor ARE the one who spend MORE on brands...Moving on , I think if a poor person spends any money on branded stuff it sticks out more than a rich person's paraphernalia , maybe that's where the question is coming from .
They do it for the same reason : fat people eat pizza , people eat ice-cream after breakup , divorced dads buy corvettes ....to find a momentary solace in an otherwise chaotic existence.
my 2 cents ....