Three Tips for Being Smarter About Money After 50
By Barbara Hannah Grufferman, August 16, 2013 06:03 PM
I think about money . . a lot. After all, my husband and I are both over 50 and still have one daughter in college and one in high school. This is definitely not the time to waste our hard-earned money on stuff we don't need.
According to Wall Street Journal columnist Jason Zweig, author of Your Money & Your Brain, when we make decisions about money, our brains often drive us to do things that make no logical sense, but make perfect emotional sense. That doesn't make us irrational, Jason told me. It makes us human.
To get a little smarter about money I asked Jason, a key financial expert in my book, The Best of Everything After 50: The Experts' Guide to Style, Sex, Health, Money and More, to give us a few tips to help us be less emotional, more rational, and definitely more in control of our money, every day.
Here are his top three "tricks" to help you hold onto more of what you have:
- Leave the cards at home: Credit card debt makes up a huge chunk of personal debt, and adds to it with high fees and interest rates. They are addictive because you get the pleasure of buying things now, but the pain of having to pay for it is delayed.
- Carry large bills: Carry hundred dollar bills instead of tens and twenties when you shop. People are reluctant to break such a large bill, because it feels like they're parting with the entire $100. Neat trick.
- The "Eight Good Reasons Rule": This is my favorite. The next time you're thinking about making a totally discretionary purchase (like a great pair of patent leather sling-backs), write down eight good reasons why you should. Most people can't come up with more than three reasons for anything. Don't make that purchase unless you come up with eight good reasons why you simply must have it. Chances are you won't be leaving the store with that shoe box in tow.
To Jason's terrific tips, I'll add my own:
Don't spend money on an expensive gym membership when you know you might never step one foot inside the door. Instead, create a basic fitness routine which you can do at home for free. Make sure it includes the three pillars of fitness: cardio (walking and running are great); strength-training (consider push-ups and the Plank); and balance (try standing on one leg while you do the dishes, then switch). Think about how much money you'll save each year!
Just in case you haven't done a push-up since high school, take a look at this short video demonstrating the right form.
I want to hear from you! Let me know what you want to see on future segments of THE BEST OF EVERYTHING WITH BARBARA HANNAH GRUFFERMAN video show on the AARP YouTube Channel. For more tips on living your best life after 50 (or 60, or 70), check out www.bestofeverythingafter50.com. Keep me posted on how you're doing by subscribing to me on Facebook and tweeting me on Twitter@BGrufferman.
Photo credit: Dave Pear