TIPS FOR TAMING FINANCIAL FEARS
POSSESSED BY THE INABILITY TO TACKLE DAUNTING FINANCIAL TASKS? HERE ARE SUGGESTIONS FROM THREE EXPERTS IN BEHAVIORAL FINANCE:
To pay off debt
If you're having a difficult time getting started, Kathleen Vohs suggests paying off the smallest outstanding bill first, even though you'd pay less in interest if you tackle the credit cards with the highest interest rates first, "As you pay off the smaller bills you will gain self-confidence as a 'saver' and that will pave the way for future savings," she explained. Denise Kautzer has some indebted clients use a cash-only strategy. That way, when it's gone, it's gone.
TO SPEND LESS
For consumers who shop too much, Susan Zimmerman suggests "wallet-less shopping," where you go to the store and make note of all the items you would normally purchase and score how great the urge to purchase is on a scale of 1 to 10. Go back 48 hours later. "Usually that score is going to be a lot lower so you recognize that the urge to splurge is actually very temporary," she said.
TO FINALLY SAVE FOR COLLEGE OR RETIREMENT
"A lot of times what has caused people to procrastinate is that they haven't ever looked at what was needed in the future," Zimmerman said. And since they have no idea, their expectations about the future are unrealistic, Kautzer adds. Head to a financial calculator or check in with a financial adviser. Consider the calculators at dinkytown.net, savingforcollege.com and choosetosave.org/ballpark.
KARA MCGUIRE