This is a post by BargainBabe.com writer Yazmin Cruz.
The impact our behavior and motivations have on our financial decisions is the focus of The Real Cost of Living by Carmen Wong Ulrich. Ulrich, who has a degree in psychology and was the former host of CNBC’s On the Money, says she sees money differently because she was not trained in the profession:
Economics has finally recognized that we are not rational creatures; we’re not all about the accounting. Behavioral economics, the study of the neuropsychology behind how we behave with our money, has won Nobel Prizes. But it’s also about time – especially for those of us in personal finance – to realize that there is a lot more going on than money when it comes to making decisions about our money and our lives.
What spoke to me the most was the chapter on the real cost of bad habits. Ulrich says the cost of being a caffeine nut can cost $115,200 over your lifetime. Obesity has a negative impact on income via wage discrimination at work. Smoking takes a toll, too. Almost $97 billion is spent on healthcare due to smoking each year, Ulrich writes. Need more financial incentive to quit smoking? The 255-page book also tackles the cost of owning a home, marriage and divorce, family, being your own boss, credit cards, saving and investing.
The book relies heavily on anecdotes, which makes for an easy read. In the chapter where Ulrich dissects the real cost of credit cards, she writes about a woman named Kim who was in a downward spiral of credit card debt. Kim was on assignment to manage her finances with Ulrich as part of her job as a blogger for Glamour magazine.
The real cost of Kim’s credit card debt was not just the interest and fees she was accumulating, but the toll it was taking on her life. Although Kim was newly employed, engaged and thinking of starting a family, her poor financial decisions were setting her back. Kim had been sued twice for credit card debt and had four credit cards in collections.
If you’d like to find out what the real cost of living is, comment by Friday, Mar. 18, 2011 at 9 a.m. PST for a chance to win my review copy. If you can’t wait to get your hands on Ulrich’s book, you can purchase it on Amazon
March 15th, 2011 at 5:22 am
This sounds like an interesting read. I love it when someone shows information collectively over a lifetime like this. Makes you really think about your choices.
March 15th, 2011 at 6:13 am
Especially with real estate prices going down, home ownership seems like a big money vacuum. I’m interested to see the cost of owning a home taken over many years. We just bought a home two years ago, and the time and money we’ve put in doesn’t seem worth it just to have your own name on the mortgage.
March 15th, 2011 at 7:56 am
[...] If you didn’t win, don’t stress. A contest to win a $100 Quiznos gift card launches later today! You can also win a copy of The Real Cost of Living here. [...]
March 15th, 2011 at 10:23 am
Would love to win this book. I used to watch Carmen on CNBC all the time. She makes a lot of sense and I’m sure her book will be a very worthwhile read.
March 15th, 2011 at 10:25 am
I tell my kids all the time “Just do the math!”
March 15th, 2011 at 10:29 am
I would like a copy. Thanks!
March 15th, 2011 at 10:33 am
I would love to read a copy and share the ideas with students
March 15th, 2011 at 10:35 am
This sounds like a fascinating book. Would love to win. Might be the kick in the pants I need to cut out some of my unhealthy and financially unwise habits (like soda and sweets!).
March 15th, 2011 at 10:39 am
I would really like to read this. Thanks for offering it!
March 15th, 2011 at 10:43 am
I would love to win The Real Cost of Living!!!
March 15th, 2011 at 10:50 am
Would love to read this!
March 15th, 2011 at 10:52 am
i would love to win a free copy of this, I could get good insight on the REAL cost of living!
March 15th, 2011 at 11:01 am
this sounds great! i would love to read this–i love reading about personal finance and LOVE that this is a different perspective! great for us right before we get married! thanks for offering this contest! your site and emails are great!!:):)
March 15th, 2011 at 11:47 am
These statistics are amazing. I would love to read the book!
March 15th, 2011 at 12:15 pm
I’d love to win this book. Although I’m pretty savvy about money, I’m sure I can learn much more with this book!!
Thanks for the opportunity to win!
March 15th, 2011 at 12:19 pm
I would love to read this book. I am inerested since you said it is a easy read due to the antidotes play on words to get her message across.
March 15th, 2011 at 12:32 pm
Sounds like a fascinating and informative read! Thanks for a chance to win!
March 15th, 2011 at 12:38 pm
I’d love to win this book to help me get a feeling that perhaps I can regain control of my finances sprialing out of control – not because I have much going out, but because I have nothing coming in.
March 15th, 2011 at 12:51 pm
Count me in….the older I get, the more I realize just how much I don’t know. Things change so quickly now that it’s almost impossible to keep up. Reading books like this help keep us out of trouble.
March 15th, 2011 at 12:53 pm
Count me in….the older I get, the more I realize just how much I don’t know. Things change so quickly now that it’s almost impossible to keep up. Reading books like this helps to keep us out of trouble.
March 15th, 2011 at 12:53 pm
I would like to have/read this book
March 15th, 2011 at 1:06 pm
Definitely would help me!
March 15th, 2011 at 1:22 pm
I would love a copy!!!
March 15th, 2011 at 1:28 pm
what a great giveaway – for my soon to be college graduate!
March 15th, 2011 at 1:42 pm
Lots to learn from this book. I hope I win.
March 15th, 2011 at 1:53 pm
With our new national motto being how to “live within your means,” this book offers sound economical lessons in layman’s terms. I would love a chance to add this to my library!
March 15th, 2011 at 2:04 pm
I love to read this.
March 15th, 2011 at 2:54 pm
Such an important topic these days. Thank you! Knowledge is Power–Amen!
March 15th, 2011 at 3:32 pm
sounds interesting!
March 15th, 2011 at 4:04 pm
This book sounds like it can be very helpful in financial planning. I look forward to reading it.
March 15th, 2011 at 5:46 pm
I would love to read this
March 15th, 2011 at 9:19 pm
At 60, I’ve pretty much figured this stuff out. What kills me, though, is seeing my 4 adult kids (aged 30-40) frittering away money on Starbucks, eating out, etc. If I mention stuff like that to them, it goes in one ear and out the other. But, if I could say, “Hey, I won this book and I’m passing it on to you”. . . . .
March 15th, 2011 at 9:52 pm
Winning this book would be a great thing to help see new ways to save on “old habits”.
March 16th, 2011 at 4:52 am
Sounds like an interesting, helpful read!
March 16th, 2011 at 2:45 pm
I enjoy getting your newsletter. I would like to read this book. It sounds rather profound…much needed. But most likely the ones that need it most will never hear of it.
March 16th, 2011 at 5:20 pm
We’ve always looked behind the “upfront” cost of things, but I know that there will continue to be new challenges to our practical thinking. For example, we’ve always contended that it is cheaper to drive and maintain a car that is paid off than buy new. I would love to see if the author agrees, and other practical suggestions she has.
March 16th, 2011 at 9:01 pm
Would love to win the book.
March 17th, 2011 at 9:55 am
Would love to use the information in this book with clients in recovery. Not only has substance abuse taken a toll on finances, it causes irrationally based thinking and poor decision making. Having Carmen’s authority base to work from will help clients to clarify the motives behind their choices and set realistic goals.
March 17th, 2011 at 10:06 am
I need to keep reading this type of thing to motivate myself to make some changes. Thanks for the chance to win one.
March 17th, 2011 at 11:24 am
Being a smart consumer is tough at first, but there are so many hidden costs. Personal financial debt reduction has been a hobby of mine for about two years. Buy quality used!
March 17th, 2011 at 12:57 pm
This definitely seems like something I need to read!
March 17th, 2011 at 2:28 pm
I am checking to see if my library is ordering a copy soon.
March 17th, 2011 at 4:12 pm
I definatly need some changes!
March 17th, 2011 at 7:19 pm
Interesting reading. Would like to learn more.
March 17th, 2011 at 9:41 pm
Looks like a great read for those of us just getting out of college!
March 19th, 2011 at 11:49 am
I have yet to read this book. I really like Jean Chatzky. I think her book, Pay It Down is the best one for getting out of debt. The book functions as a workbook as well. You don’t have to buy a separate book. I feel that you get 2 items for one price. It came out awhile ago so it’s on sale too. Suze Orman is always tops too.
http://www.moneysavingenthusiast.com/random-acts-of-saving.html
March 21st, 2011 at 8:20 am
[...] you missed my book review, Ulrich reveals that a caffeine addiction can set you back $115,200 over your lifetime. The cost of [...]
March 23rd, 2011 at 2:35 pm
I like reading books that speak to the emotional cost of our behaviors even the good ones and especially how bad habits have a habit of being too hard to sidestep.