April 9, 2019
Finance pro says it's easy to overindulge in both food and spending, as they're emotionally charged, and equally tough to tackle.
Earning a finance degree from a prestigious business program is no guarantee you'll know how to manage your personal finances. Just ask Ashley Feinstein Gerstley, author of The 30-Day Money Cleanse: Take Control of Your Finances, Manage Your Spending, and De-stress Your Money for Good.
"I was a finance major at Wharton (the University of Pennsylvania's business school), worked in investment banking and corporate finance and still knew nothing about money," Feinstein Gerstley said.
"It occurred to me that if I didn't know, who did?"
As she began reading about personal finance and blogging about her own experiences, Feinstein Gerstley found that people were reaching out to her to share their money woes. The 30-Day Money Cleanse grew out of an online course she developed to try to help people create healthier relationships with money.
We asked Feinstein Gerstley about why people have so much trouble handling their own finances - and how they can do better.
Why do you consider money and food to be so similar?
Both money and food are really emotionally charged. It sounds simple to control them: money in should be greater than money out; calories in should be fewer than calories out. However, if it were that easy, there wouldn't be a billion-dollar diet industry. We relate to them, in similar ways, and they are both things we can't avoid.
What's an "expense onion?"
When you think about an onion, the outer layers are the first to get really hard and crunchy and fall off; these are comparable to the financial changes that it's easy to make, such as using transit more often, instead of taking cabs. The inner layers are those financial behaviours and habits that are tougher to peel away.
The idea is not to force new behaviours or to be too restrictive in a new spending plan. Start with the crunchy, easy layers and as you progress through your money journal, other layers will become crunchy and you will be left with things that make your life more rewarding and fuller.
Why are the words we use to talk about money so important?
The language we use in talking about money affects our mindset. We need to reframe the talk around personal finance so people stop viewing budgeting as something painful that they should do. Instead, I want them to see it as an experience of self-love, one that will allow them to leave undesirable situations and take risks in their careers. We need to be careful with the language we use because it helps create the relationship we have with money. Think about cutting versus letting go; the former implies that the money is being pried from your hands; the latter indicates that it's your choice to stop spending it.
What is a "happiness allocation?"
It's a much more fitting term to describe an annual budget or a spending plan because it is all about allocating your money in a way that makes you truly happy - getting the maximum joy per dollar spent. It allows you to see what's available for your short- and long-term goals. When you don't look at the annual picture, you miss out on the larger impact of regular expenses and on the money you spend for occasions that don't happen regularly, such as holidays, weddings and trips.
I've always spent money to have a good time. Why do you think frugal joys will make me happy?
Frugal joys are free or inexpensive things that make you really happy. You don't have to replace the things you love with frugal joys; you can simply add more joy to your life without adding expenses.
They are also great tools if you want to replace expenses since it means you won't have to give up joy if you spend less. Test out a few each week; preferences are very individual, so see which ones work for you. I offer 100 examples, such as exploring a new neighbourhood, playing with a puppy and reading a really good book.
I'm not very disciplined with money, so will this 30-day cleanse work for me?
Self-discipline doesn't work with food and money; I find that we rebel against it. This is all about gifting yourself and understanding that how you treat yourself now is at the expense of what you really want. It's a reframing, so you're not battling yourself to get what you want. It's a beautifully designed, colourful way to improve. It's about helping you achieve your important goals, rather than becoming prey to marketing about what you should want. It doesn't matter who you are now around money; you can always get better.
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