Truebill Editor’s Finance Friday Picks: Must Haves, Reads and Do’s
Though I’ve worked in the financial technology industry for several years, I’ve felt like a bit of a fraud. I’ve had this notion that working in the finance field should automatically mean that I’m the perfect picture of fiscal responsibility. Am I?
I’ll let one of my latest tweets speak for itself.
Spoiler alert: I did.
Predilection for canine pageant-wear aside, I am obsessive about learning about how others manage their finances. I feel that personal budgeting and financial management are a lot like losing weight – we all know how to do it, and failure to meet our goals isn’t due to lack of knowledge. I’m willing to bet that every person reading this knows the basic formula for saving money, just as we all know the basic formula for losing weight.
Then why do we spend so much time reading about personal financial management – following finance bloggers, pinning ideas on Pinterest and reading the same general ideas over and over? If we know what we need to do, why aren’t we doing it? In 2015, Go Banking Rates surveyed 5,000 adults and asked how much money they had saved in a savings account; 62% of them said they had less than $1,000 saved.
In fact, a 2014 Wells Fargo study found that nearly half of Americans find discussing finances more difficult than discussing religion.
One theory I have is that traditional budget and financial planning address the wrong side of the equation – the money. I think the focus actually needs to be on the person. For instance, I know that purchasing a dog tiara isn’t the most fiscally responsible decision, no matter how adorable my chihuahua looks while she’s wearing it. If my financial advisor said to me, “Well here’s the problem, Jess, you’re spending money on clothing and accessories for a 4 pound dog,” I’d be thinking, “Yeah no kidding, why am I paying you?”.
Therefore my interest in financial management centers around human behavior and habits – why we do what we do. Why some people are financial whizzes, while others have to try harder.
The problem is that financial plans are typically treated as a “one-size-fits-all” proposition and, like diets, that’s just not realistic. @mytruebill
To learn more about the “why” instead of the “how,” I began turning to books, articles, podcasts – anything I could get my hands on to gain insight. Here are some of my favorite finds that have made a profound difference:
1. Book: Better Than Before
Gretchen does a phenomenal job of explaining habits, both good and bad, and breaking down why it’s so easy to pick up bad habits, and so hard to adopt good ones. Perhaps the most interesting part of the book is the four personality types she introduces: Upholders, Questioners, Rebels and Obligers. Each personality type has a unique response to habit formation and therefore need different strategies to approach habit change.
In this book, Gretchen helps the reader to identify which personality type they are, and gives helpful suggestions for adopting new habits based on that type.
2. Email Tool: Unroll.me
Online shopping is my weakness – between my poor impulse control and my love of instant gratification, online shopping hits all my weak spots. One of the biggest culprits of inspiring my online shopping is email. An email from my favorite retailer letting me know about a fantastic deal that is not to be missed is tough to ignore. It can be especially challenging if the retailer doesn’t send emails on a regular basis because, just when I think I’ve unsubscribed from promotional emails from the biggest temptations, another one that I forgot about will pop up.
Unroll.me is the answer to those pesky emails. It identifies the email lists you’re subscribed to and offers the option to unsubscribe from the email sender, keep the email coming to your inbox, or add it to a “roll up” list, which is a digest from Unroll.me that will contain emails from your chosen senders, all in one central email.
3. Amazon Universal Wishlist and the 24-Hour “Think About it” Rule
Believe it or not, re-routing your shopping trigger-finger can be enormously helpful. Instead of adding that rhinestone-studded dog collar (that may match a tiara you previously purchased) to your cart, add it to a wishlist first, and then give yourself a 24-hour window before you actually purchase it. Amazon has a universal wishlist to which you can add items from any website, not just Amazon. Once that 24 hours is up, give yourself a gut check to see if you even still want that item. I’m willing to bet that, at least 50% of the time, you’ll have thought better of purchasing the item.
4. Stranger Method
This unique tip comes to us from FiveCentNickel.com – the “Stranger Method”
“When considering a purchase, picture a stranger offering you [the cash value of the purchase] or the item in question. Which is of greater value you? Which would you choose?”
This is a great way to think about that purchase – if you’d rather have the money than the item, put the item back.
5. Keeping it Old School with Check Registers
As someone with Asperger’s Syndrome, one of my biggest challenges is overcoming the executive functioning deficits that are common in those of us who are autistic, as well as those with other learning deficits, such as ADD/ADHD. Executive function deficit impairs the normal ability to execute daily tasks such as analyzing, planning, organizing, scheduling, and completing tasks. I’ve had to recognize all of the areas where this affects my life, and I still regularly discover new ones.
As much as I love technology, I’ve come to realize that I tend to do best when I use good old fashioned methods to keep track of my finances. For one example, I love budgeting apps but, unfortunately, if something is out of my sight, it’s out of my mind. That means that, no matter how beautifully my budget is laid out in a budget app, I will not think to open that app and check it regularly. Similarly, I have to keep my produce on the top shelf of my refrigerator to remember to eat it, because if it’s hidden away in the crisper, I can’t see it, so it may as well not exist.
Good old fashioned check registers have proven to be the best method for me to keep track of my spending. I keep one right in my wallet so that every time I do a transaction, I see it and am reminded to record the transaction and keep track of my spending. For purchases from online retailers, where my credit card number is saved, like Amazon, I have set a nightly reminder that goes off right before bed to remind me to record online purchases. Luckily, since online retailers send a purchase confirmation email, the purchase info is all in my email inbox, making it a snap to go through my email and record those purchases. I get a box of 10 check registers for less than $7 on Amazon, and they are priceless.
6. ATM Fees Are at a Record High
According to this article by Alicia Adamczyk for Times Money, out-of-network ATM fees are at an all time high, and expected to get higher. Luckily, there are several options to avoid these fees – which are so high they often wipe out any interest you’re making on your account balance.
7. Episode 18 of the Financial Mentor Podcast
This particular episode features special guest Dane Maxwell, founder of entrepreneur incubator The Foundation. In this podcast episode, Dane discusses limiting beliefs and how they can sabotage your goals. As Dane puts it:
If it was just about how-to’s then we would all be thin, rich, and happy because all the knowledge you need to attain anything you want in life already exists. You just have to learn it and implement it.
But it doesn’t work that way. You aren’t a perfect, rational computer.
You don’t just process information, make plans, and produce results in a logical, perfect way because you are an emotional human being. Your emotions and beliefs are a filter that either serves you in achieving your goals, or they hurt you.
It’s a profound episode full of insight around the limiting beliefs we tend to have about ourselves, and how to reframe our beliefs to better serve us.
What are your favorite tips for succeeding at managing your finances and building wealth? Leave me a comment below and yours may be picked to be featured in a future Friday roundup.