Book Review: Dollars and Sense – How We Misthink Money and How to Spend Smarter

Money.

What comes to your mind when you think of it? Is it something you use to pay bills? Is it something you use to buy necessary things for pleasure and happiness? Each one of has a different opinion on about it. It touches every part of life, family budgets. national politics, shopping to saving.

With every purchase, we think of how much money do we have, how much we need, how can we make more etc. The book depicts the most common mistakes we make when it comes to money and reasons behind it those mistakes.

Jeff and Dan ask questions such as:

  • Does it matter if we use credit cards or cash? We spend the same amount either way, right? Actually, studies show we are more willing to pay more when we use a credit card. We make bigger purchases and leave larger tips with credit cards. We’re also more likely to underestimate or forget how much we spend when—you guessed it—using the payment method we use most: a credit card.
  • What’s a better deal, a locksmith who opens a door in two minutes and charges $100 or one who takes an hour and charges the same $100? Most people think the one who took longer is the better deal because he put in more effort and he cost less per hour. But what if the locksmith who took longer had to try several times and broke a bunch of tools before he succeeded? And charged $120? Surprisingly, most people still think this locksmith is a better value than the speedy one, even though all he did was waste an hour of our time with his incompetence.
  • Are we saving enough for retirement? Do we all know even vaguely when we’ll stop working, how much we’ll have earned and saved by then, how our investments will have grown and what our expenses will be for the exact number of years we’ll live after that? No? We’re so intimidated by retirement planning that, as a society, we’re saving less than 10 percent of what we need, aren’t confident we are saving enough, and believe we’ll have to work until we’re eighty even though our life expectancy is seventy-eight. Well, that’s one way to cut down on retirement expenses: Never retire.
  • Do we spend our time wisely? Or do we spend more time driving around looking for a gas station that will save us a few cents than we spend trying to find a cheaper mortgage?

It was very enlightening to read how our psychology works when it comes to money. The writers’ have used research and studies you explain situations and pointers. The best part of the book is humor, the punch timings are great and have been used very strategically while talking about serious situations.

All in all, you must read the book to become aware and sound about your decisions surrounding money and its impact on your day to day life. Get all your questions about money answered in the book.

 

You can buy it here: Amazon

Excerpts from the book!

Loved reading it? Follow us at The Business Front

 

 

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