Solidifying Your Finances Through Psychology and Human Behavior Optimization

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Im just going to come right out and say it.

Most of the people you knowhave no idea what to do with their money.

They probably have no idea where their money goes.

They probably waste money on dumb things while saving very little

Theyre probably trudging towards alife of poverty in retirement.

My hope is that you have good financial influences in your life, because no matter who you are, you will inevitablypick up the habits of those around you.

So to that note,I want to address a question Im asked pretty frequently what to do with extra money (other than swim in it of course).

But before I go on, you should know that the choosing the wrong way to go about handling this situation can cause you to develop some destructive behaviors and habits and could spell disaster for you financial future.

If youve ever been in a situation where you have extra money floating around, wellthats a good problem to have.

Were talking something like a few thousand bucks or more here, or a large and extended cash flow surplus.

If not, itll probably happen to you at some point, andI want to be in the mindset that it will,so keep reading.

Maybe its from a big bonus or settlement of some kind

Maybe it was a windfall cash gift from a relative

Or maybe youre just smart and youre making a lot more than you have expenses

Whatever the situation, this can be one of two things along the spectrum of money.

It can fall towards the end of being aawesome opportunityto create a large amount of wealth for yourself in the future

It can fall towards the end of being agateway to opening up the flood gatesof overzealous spending habits in your life.

Before we get into the seven awesome things to do with your extra money,I want to throw you a very important warning.

If youre about to just scroll down to the 7 strategies, I cant really stop you,but if you really care about your money I urge you to heed my warning, young grasshopper (Ive always wanted to use heed in a sentence).

Before I go on a rant, heres some data for you to back up this point.

When people come by a large chunk of unexpected money, there is a strong feeling in them thatits not really theirs, and they have a license to spend it.

Just think about the last time you found any quantity of money. What were you immediately tempted to do? Spend it on something, right?

The same is true for any type of found money.

In 2009, Harvard Researchers found that when they gave participants of an experiment an extra $10 more than a peer group, the subjects spent 20% more after being told the money was extra in nature.

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what is the Harvard study? where can i find it

Hi Victoria. Honestly this was quite a while ago. I should have linked to the study when I wrote the post, but unfortunately I cannot track it down now. I really dont remember where I read it. Its possible it was in a book and not online. Sorry about that.

Heres another good post that references the same topic. Hope this helps.

I like your writing style. A practical easy to read article that is to the point. Thanks for the tips.

Je suis tomb sur ce site іnternet par hance : je ne le regrette pas

I really liked this article. Very applicable as we just paid off our mortgage and are in the what now? stage. Loved your experience fund idea Im definitely putting that into place right now. Weve currently got a Vacation fund and an Entertainment fund, which Ill be merging!

Great job Samantha. Its a huge step to pay off any large chunk of debt, and youve just paid off the biggest one of all for most people.

Thanks Amy. Glad you liked it. Hope all is well for you.

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