Is there such a thing as good debt?
Bottom line: The best kind of debt is debt you can afford. This means debt that has monthly payments sufficiently low enough that you can pay it down while meeting all your other necessary living obligations (and a few fun ones, too) with cash.
Get Rich Slowly has a great post on the psychology of money, saying that it’s more about the mind than about the math. We’ve talked about the emotions of money, and why for some reason we tend to make poor decisions when it comes to our money.
One of the best ways to avoid making bad decisions? Automate, says GRS.
Automate. One of the best ways to trick your mind is to simply take it out of the equation. If you find it difficult to make smart financial choices, remove the choice. Sign up for auto-billpay. Set up an automatic monthly transfer from your checking account to your savings account. If you have access to an employer-sponsored retirement plan, take advantage of it. When you make things automatic, you cannot be sabotaged by emotion or psychology.
I like it. (Find out more now.)
Finally, the NY Times has an interesting piece on the true costs of items at retailers, where credit, cash and debit users are often paying different prices.
About the author: Jason is the author of Automatic Finances: 17 Days to Your Financial Freedom, a guide to automated money management. He started investing thanks to a free lunch, and after finding out how he was getting the short end of the stick, he sought out how to do it right. More »