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Money isn't about math, it's about psychology

posted October 18, 2009 - 5:10pm
Money isn't about math, it's about psychology

Humans are not calculators, and they're not machines. Otherwise we'd all live within our means. So Get Rich Slowly wrote something about how to control our minds so that we don't spend emotionally and can get our finances under control.

 

He recommends reducing your exposure to advertising. If you don't know about a product you won't want it. Obviously this could backfire, you probably want to know about things like IRA's or investment opportunities, but the less you know about your vices probably the better.

 

Avoid temptation. If you're a bookaholic like me or the author, stay out of Barnes and Noble. If you're a clothes-horse stay away from the mall. A techno-geek, Best Buy. You get the point.

 

Automate your finances. If your bank will take a certain amount out of your checking and stuff it in savings, use that feature. If you have access to a 401K at work and it's decent, use it. Don't give yourself a chance to say "oh I'll do that later" and then spend the money.

 

Be mindful of your purchases. Do you really need the 80th book on your shelf that you haven't gotten to yet? Track your purchases so you know what's your weakness so you can take extra care.

 

Get educated about money. The more you know the more likely you are to make smart decisions.


Article: http://www.getrichslowly.org/blog/2009/09/28/money...

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