I found Jeff Kreisler because he co-wrote the book Dollars and Sense: Money Mishaps and How to Avoid Them with co-author, Dan Ariely, Psychologist, and Behavioral Economist.
About Jeff Kreisler
Jeff Kreisler’s background is extremely diverse. He’s an attorney, an author, a speaker, and above all, he’s a comedian. Check out Jeff’s YouTube channel.
It was his love for comedy which brought him to write a book called Get Rich Cheating, about how money makes us do unethical things.
How Jeff got together with Dan Ariely
Through this book, Jeff met with Dan Ariely. Dan invited Jeff Kreisler to speak at one of his classes and the friendship developed from there.
Dan proposed the idea of writing the book together. He supplied a bunch of research that he and his peers had done and he said, go for it, see what you can come up with. Jeff would write big chunks of the material and send it to Dan to see if he was on the right track. Dan would make suggestions, the changes would be made, and after a few similar exchanges, the book was created.
Credit card companies separate us from the painful experience of using cash
In the first chapter, the main character goes to the casino, exchanges his money for plastic chips, and finds it a lot easier to gamble.
A parallel can be made between casino chips and credit cards. Through the use of plastic, spending money seems less real and thus we spend more.
Mental accounting
We have a tendency to separate our money into different mental accounts, in particular on how we earned the money or how we are planning to spend it. For example; If I received $100 as a birthday gift, I could spend it in the bar drinking with friends. But if I earned the same $100 with lots of hard labor, I will try to put it towards the payment of my bills or towards my savings account.
The cost of free
Free is a price, and it has a uniquely strong pull. We pay for free with our time, our attention, our mind space.
Retirement
We have a hard time saving for retirement because we have too many unknowns. We don’t know how much we spend, sometimes we don’t know how much we earn, if we invest the money we don’t know what kind of returns we will get, we don’t know how long we are going to live.
Thinking about retirement is so complex that the easiest thing is not to think about it, not to save. If you don’t know about it, it doesn’t exist.
As humans, we are better connected to our immediate needs than to our future needs in retirement.
We can see consumption, we can see spending, and we can compete with it. We can try to outspend the person next to us because they show us how they are spending that money. When we spend $100 on a new dress, people compliment us, they tell us how much they like it. When we put $100 in our savings account, we don’t get any feedback, we don’t get any congratulations, we don’t get any smiles nor hugs.
Final thought
Don’t spend time thinking about decisions with little monetary consequences. Whether it’s the latte or a few dollars for one thing or the other. On the other hand, take the time to think about more important things, such as the terms and conditions of your mortgage, where your kids are going to school, your retirement accounts, etc.
Other resources
YouTube conversation between Dan and Jeff
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- 009 Interview with Ed Mills, The Millionaire Educator
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