Work, Business & Money​​

What to Do When You’re Bad at Money

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Markus.Green
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The older we get, the more we see the need to be in tune and accountable for our spending habits, particularly if we're saving up for a big purchase like a house or car... but if you're just naturally terrible at budgeting or dealing with money, surely personal finance management can be a learned skill. Right?
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Personal finance management can be a tricky concept for most people, but it doesn't have to be. Share some of the personal finance management tips that have worked for you
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arianna.cox
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I use good, old-fashioned pen and paper. I keep a small pocket notebook with me and write down my purchases. And I go a step further and I write down the stuff I’m tempted to buy, any notes about how I feel when I want to spend money impulsively, and any habits I notice. It sounds very touchy-feely, but learning to be good with money has so much to do with learning to manage your habits.
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I'm quite big on apps, seeing as I'm always on my phone... it just seemed like the easier and more convenient option.
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I'm quite big on apps, seeing as I'm always on my phone... it just seemed like the easier and more convenient option.
Me too! For budgeting and managing money in general, I’m a big fan of Mint. They’re probably the most popular option because they have so many fun features that make it really easy to keep track of your spending.
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Me too! For budgeting and managing money in general, I’m a big fan of Mint. They’re probably the most popular option because they have so many fun features that make it really easy to keep track of your spending.
I’ve never used these myself, but for tracking I’ve also heard people recommend Expense OK and ExpenseKeep.
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Wirecutter, a New York Times company that reviews and recommends products, picked You Need a Budget as their top budgeting app, and I’ve also heard wonderful things from users of YNAB.
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It helps to understand our cognitive biases around money and the weird ways our mind can work against us when it comes to money.
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It helps to understand our cognitive biases around money and the weird ways our mind can work against us when it comes to money.
The concept of anchoring is a good example. It’s a bias where we rely too heavily on one piece of information to make decisions. So, for example, let’s say you’re at a restaurant and you see their featured menu is a $20 cheeseburger. You think, “Whoa, who would pay $20 for a cheeseburger?” Then you see a cheeseburger for $15 and you think it’s a good deal, so you order it. But it’s not actually a good deal, it just looks that way compared to the $20 anchor. We often think we have more control over spending decisions than we actually do.
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Contrary to popular belief, some research shows people spend more on stuff when they have a coupon. We get a high from saving money when we coupon, and that makes us feel good, which makes us want to shop more.
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Spending is often a really emotional experience, and the most important way you build better habits around money is to understand the emotions that come with it
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Everyone’s habits with money are going to be different. If you want to improve yours, it’s crucial to understand your relationship with money and how you approach it so you can pinpoint bad habits. If you don’t deal with the emotional side of money management, the practical stuff might not work.
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I would say spend wisely
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I used to be pretty terrible with money, and to be super honest, sometimes I still am. I overspend, and I could probably stand to save more for retirement, but with discipline, I have developed better habits over time
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I used to be pretty terrible with money, and to be super honest, sometimes I still am. I overspend, and I could probably stand to save more for retirement, but with discipline, I have developed better habits over time
I’ve learned to let go of the shame I associated with it. We sometimes feel so ashamed about our money habits because there’s so much judgment around money! If you’re dwelling on a past mistake you’ve made with money, or you just feel like you’ll never be good at it, you tend to avoid it altogether.
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Speaking from personal experience, it really does get better with time.
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Don’t think you have to learn everything about personal finance overnight. Being good with money is an ongoing habit, so invest the time and energy in learning about it a little at a time.
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Don’t think you have to learn everything about personal finance overnight. Being good with money is an ongoing habit, so invest the time and energy in learning about it a little at a time.
Indeed. If you can find a financial resource — a book, a podcast, a blog — that makes you feel positive about your relationship with money, stick to that resource and keep learning a little bit about money at a time.
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