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Eric Tyson on Having More Money
With six national bestsellers, Eric Tyson is one of the top-selling personal finance authors in the U.S. His syndicated newspaper column, “Investor’s Guide,” is read by more than 4 million people. Tyson’s work has been featured and quoted in hundreds of media outlets, including The Wall Street Journal, USA Today and NPR’s “Marketplace Money.” Tyson’s Personal Finance for Dummies won the Benjamin Franklin Award for Best Business Book, and his newest title, Let’s Get Real about Money, is due out sometime in 2007. Tyson shared these thoughts on having more money:
How much of financial success is following practical steps, and how much do you think is mental or a mindset?
People’s habits are part practical and part mental, but probably more of the latter. It’s hard to get people to change their behavior. That’s one thing I’ve learned in my years as a financial counselor. It’s not rocket science to follow the fundamentals of sound financial management, but people learn certain habits as they’re growing up, and they carry those into adulthood. My new book—Let’s Get Real about Money—really addresses ingrained habits and how to change them. From the work I’ve done as a financial counselor starting in the early 1990s, I’ve realized that I can tell people until I’m blue in the face that they should do certain things, but it’s a different story actually getting people to change their behaviors, especially if they don’t have the necessary tools or techniques. Each person’s relationship with money is very complicated. Today’s gurus make it sound so simplistic; that it’s “think positive about money and it will come to you.” It’s not that simple.
What are the first three things a person should do during the first 30 days of having more money?
1. Get educated. I can’t emphasize that enough. There’s very little personal financial education at home or at school. You have to build a foundation of knowledge and books; like the ones that I’ve done will help you get educated.
2. Come up with a “to do” list of things that you’ve decided need to be changed. It’s good to come up with a list… it’s not necessarily just things that you will do in the next month; some of them will take longer.
3. Where appropriate, identify professionals you will hire to help you accomplish those things.
What phases do you typically see people go through during the first 30 days of having more money?
It’s very common for people to feel stupid about how they’ve handled their money in the past. They can feel overwhelmed at times, but I think they can also start to feel like, “Gee, this isn’t so complicated.” Then they can feel empowered—and motivated if they’re working with a good counselor; and they can see the value of getting things back on track; and that can act as a great motivator for change.
Beyond the first 30 days, what factor is most important in helping people save more money?
Having a road map and remembering to come back to that. It’s common to have a high level of motivation in the beginning from a financial counselor or even a good book, and then life happens and you get busy with other stuff; and before you know it, you’re procrastinating or not making the changes you had in mind. So it’s important to set up some checkpoints.
Can you offer any advice to help people counter the need for instant gratification that entices them to spend money?
I find that it really helps people to sit down and take some time to think about what their short- and long-term financial and personal goals are. Money is not an end in itself; it’s a means to an end. If they want to change careers, take some time off, start a family—whatever it is—I find that people get more motivated and interested in handling their money when they think about what money can do for them.
Money does give you choices, there’s no doubt about it. I think it really comes back to thinking about what your personal goals are and how better managing your money will help you get there.
What is the belief you personally go to during times of change?
I come back to the belief that I can always get better at something. There’s always room for improvement. There are always ways to learn to do things better than you did before.
The best thing about change is …
…the opportunity it presents for making improvements or accomplishing new things.
What is the best change you have ever made?
To become an entrepreneur—to decide to run my own small business. Not to say I didn’t like working for employers, but going into my own business really enabled me to pursue something I was passionate about in a way that I was comfortable doing it.
For more information on Eric Tyson, visit www.erictyson.com.