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Jill Schlesinger has worked as a gold and silver options trader, a certified financial planner and now appears as an analyst for CBS News, in addition to hosting her own radio show and podcast. In all her experience helping other people deal with money, she's learned that everyone screws up at some point. She's collected some of these screwups in her new book, "The Dumb Things Smart People Do With Their Money."
We spoke to Schlesinger about how to avoid being so dumb.
"Because we are human beings," Schlesinger said. "We are ruled by our emotions. Specifically, fear and greed really come into play when we talk about our financial lives." (Learn how your brain keeps you from saving money.)
It's not money that money is so difficult, she said. It's that we have trouble controlling our emotions when it comes to money.
"I wanted to really make sure I did not lose that voice because I feel like people were responsive to it," Schlesinger said. "I wanted to give information and make it accessible and tell the stories of people I encountered.'
The first sentence of the book says everyone suffers through "'Oh, shit' moments." (Schlesinger says her publisher did not love this.) Schlesinger's voice is friendly and comforting throughout, so you feel like you have a friend in your financial journey.
"Really smart people fuck up," she said. "That's really the issue."
Schlesinger dedicates an entire chapter to insurance.
"I heart insurance," Schlesinger said. "I'm going to get T-shirts printed. There's so much risk in our financial lives and in our everyday lives and it's very difficult to mitigate risk in all these areas but we have this thing called insurance which allows us to pool our dollars together as a group, push it into a pot and spread the risk out across everyone in the group."
"Insurance is cool" is a hard sell for most people, but that's why Schlesinger takes time to explain it.
"Although insurance can be an amazing solution, it's kind of complex," Schlesinger said. "It's kind of boring and it's hard for consumers and regular people who just want to solve the problem."
(Hint: insurance can be confusing. Our insurance checkup tool will help you figure out what coverage you need.)
Schlesinger interviewed a wealth psychologist to find out why otherwise smart people have so much trouble developing good financial habits. A lot of it comes from your upbringing, she learned.
"It's not just the emotional issues that your parents pass on, but it's a lot of their issues around money that get passed along," Schlesinger said.
While you can't erase that history, knowing the source of your money hangups can help.
"What you can do is you can name it, you can label it, you can see it, and then you can see the traps you start falling into," Schlesinger said.
After all, you don't want your children to inherit the same money problems.
"That behavior is going to follow them around, so maybe try to get right with yourself and not pass that along," Schlesinger said.
Each chapter in the book tackles a "dumb thing." Dumb thing No. 3 is "You Make Money More Important Than It Is." We asked Schlesinger how much we should value money.
"We're really hung up about money, perhaps more than we need to be," she said. "Because once you have your shelter, you pay your bills and you can live your life week to week, month to month, you're not acting out of crisis. You're not acting out of scarcity."
Most of the people Schlesinger writes about aren't doing so badly financially. But they still get overwhelmed by money.
"The money is the concrete thing on which you are putting all of your emotional stability," Schlesinger said.
Schlesinger thinks the millenials she's met take a better approach. They view money as a means to an end. She summed it up: "I'd like to have the opportunity to choose different things in life and the only way to create that opportunity is to manage my financial life in a really responsible way."
"I think many of the other books that have been written are dumbed down and the author wags their finger in your face and says eat your vegetables," Schlesinger said. "The people I'm talking to, they're not in debt up to their eyeballs. Many of them are not in control of their financial lives and they feel embarrassed by that. We need to talk about this in a way without judgement and in a way that gives you permission to be a financial fuckup."
"I'm funny and I'm accessible and I'm smart," Schlesinger said. "I'm a CFP. I have more than 30 years in the business. I understand the nuances and the inside story of financial services. I have made real mistakes with people. I have a way to break through the bullshit and make this an appealing and nonjudgmental way of taking in some financial information."
We pointed out to Schlesinger that "The Dumb Things Smart People Do With Their Money" costs the same as a topiary frame pig on eBay. Why would anyone choose the book?
"My book is likely to save you or make you at least $25 in one reading," Schlesinger said. "Will that topiary pig make you laugh out loud?"
"The Dumb Things Smart People Do With Their Money" is available wherever books are sold.
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