Fred Harteis News Articles - Why you just can't seem to save enough

Fred Harteis News Articles - Your mortgage is prime. Your credit-card balance is reasonable. You've set aside some money for retirement. Feeling like you've done all you should? Didn't think so.

All signs point to an economic slowdown, and there's a real risk that it will be a nasty one. Jobs look shaky, food and gas prices are up, and the credit you thought would be there in an emergency could get a lot more expensive.

Even if you've been better than the average about saving, you probably wish that you had a bigger cash cushion right now. And if you're at all like me, you've been looking around your house lately and wondering, "Why didn't I put the money I spent on that in the bank?"

In short, I got caught up in a kind of consumer mob. It's no secret that our spending habits are driven in part by the crowd we're in. But there's more going on here than envy and status seeking. Most of us don't like doing math, and even fewer enjoy keeping a budget. When deciding whether a big expense is reasonable or not, we often take mental shortcuts. One of the easiest is to look at what people we know are doing.

That's trouble because we're almost certain to draw the wrong conclusions, says Ronald Wilcox. His new book, "Whatever Happened to Thrift?", is a surprisingly witty guide to a gloomy subject: the complete inability of the world's richest nation to save.

A big part of the problem, Wilcox says, is that our shortcut-loving brains trick us. "We tend to remember extraordinary consumption more than mundane consumption," he notes. Wilcox says this is an example of what research psychologist Thomas Gilovich calls a one-sided event.

There's little reason to notice that most of your neighbors drive Accords. It's a good car, but who daydreams about owning one? When a single family on your block buys a Lexus, however, it suddenly feels as though everybody has one.

If high-living pals are a problem for you, find some new ones. That doesn't mean you have to cut off the big spenders. Just widen your social circle. Take up a volunteer activity or a cheap hobby where the accent isn't on consumption. Forget the country club. Join the "Y" or, better yet, an investing group with a long-term focus.

Source; Cnn.com

About Fred Harteis: Fred Harteis leads Harteis International. Fred Harteis has a background in agriculture and has created many successful business ventures.