Providing financial and physical shelter

Managing money

Taking care of your financial resources

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Money may not buy happiness, but it is also hard for most people to be happy without any. Having money lets us take care of ourselves and, just as important, provide for others. Most of what we want to do is easier if we have enough money, and harder or even impossible without it. Money is not everything, but it counts for a lot.

Yet most of us don’t know that much about money. Even things that used to be simple about money, like bank accounts and credit cards, have gotten complicated and seem to generate reams of mail. And things that used to be complicated, like paying taxes and buying a house, have become almost incomprehensible. Meanwhile, very clever and well-paid people continue to invent new ways to make finance even more complex. It’s not surprising that most of us tend to just do the minimum, not pay attention and, consequently, miss opportunities – or worse, make serious blunders.

You actually don’t have to be an expert to make prudent financial decisions, though. The trick is to find the middle path between being too complacent and too ambitious, between taking what comes easy and shooting for the moon. And to get professional assistance when you need it.

On this page we mix some usable observations and advice with references to additional resources that should help you avoid decisions you’ll regret some day.

Managing Money relates to other areas of Security:

Managing Money relates to other areas besides Security:

Managing Money Sub-Topics and Resources

Just in the last decade or two, professional advisers and counselors have noticed that many of us have very strong attitudes – and sometimes extreme emotions – connected with money. These can go back to how much or little money we had (or our families had) growing up, attitudes that our parents tried to instill in us (or instilled in us by their example), our own self-image or sense of self-worth, and our religious or other beliefs about ourselves, other people, society, and, of course, money itself.

Since few of us really stop to think about these things, these attitudes and beliefs about money (and therefore about our own worth vs. other people’s worth, whether money is a good or evil thing, the independence money gives us and the power it can give us over others, the value of things money can buy, the importance of saving and of financial responsibility, etc.) often lie somewhere under the surface. And if we never bring them to the surface, it is hard to be sensible about money because, in effect, we end up letting money control us, instead of the other way around.

These issues are worthy of book-length treatment, and many such books have started to appear. But there are also some other, briefer, and free resources available on the internet. If you feel that you have problems that need professional attention, “financial therapy” is a young but growing field, and you might be able to find someone with this specialty in your area.

Money is right up there with Love as a subject on which everyone seems to have an opinion, and an awful lot of people have expressed themselves – and continue to do so, on websites, in books, magazines, newspapers, and newsletters, on TV and radio, and over the dinner table. We cannot begin to provide a useful guide to this mass of material.

Instead, we emphasize first that there are two kinds of savers/investors: those who like to do it themselves and those who don’t. The do-it-yourselfers either enjoy money management as a hobby, or just think they are smarter than the next guy, or both. Those who prefer not to do it themselves are sometimes not well informed about finances and know it, or sometimes they are very well informed but just prefer to spend their time doing other things. Almost all of the published information is for the do-it-yourselfers, though we will direct you to some exceptions.

Second, the fundamental issue that everyone must address, whether you manage everything yourself, or whether you leave that to others, is what your attitude toward financial risk should be. This is both a theoretical question, and a very practical one. A well known Wall Street saying explains that the strategy for success is to “buy low and sell high.” In reality, however, a lot of people do the opposite – they buy high, because they get excited (or start feeling foolish or left out) when the markets are doing well, and they sell low, because they get stressed or panicky when markets drop too much.

So the main order of business is to understand in a general way what your attitude toward risk should be, and then how to reflect that in the management of your savings and investment portfolio, whether you manage it yourself or someone else is doing it for you.