One economist's take on popular advice for saving, borrowing, and spending

Planet Money

NPR

Business, News

4.6 • 29.8K Ratings

🗓️ 23 November 2022

⏱️ 33 minutes

🔗️ Recording | iTunes | RSS

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Summary

This episode was first released as a bonus episode for Planet Money+ listeners last month. We're sharing it today for all listeners. To hear more episodes like this one and support NPR in the process, sign up for Planet Money+ at plus.npr.org.

Planet Money+ supporters: we'll have a fresh bonus episode for you next week!

"Save aggressively for retirement when you're young." "The stock market is a sure-fire long-term bet." "Fixed-rate mortgages are better than adjustable-rate mortgages." Popular financial advice like this appears in all kinds of books by financial thinkfluencers. But how does that advice stack up against more traditional economic thinking?

That's the question Yale economist James Choi set out to answer in a paper called Popular Personal Financial Advice Versus The Professors. In this interview, he tells Greg Rosalsky what he found. Their talk marks another edition of Behind The Newsletter, in which Greg shares conversations with policy makers and economists who appear in the Planet Money newsletter.

Subscribe to the newsletter at https://www.npr.org/newsletter/money.

Read more about James Choi's paper here: https://www.npr.org/sections/money/2022/09/06/1120583353/money-management-budgeting-tips

Transcript

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0:00.0	This is Planet Money from NPR.
0:05.6	Hey, Kenny Malone here.
0:07.0	We are off the rest of this week for the Thanksgiving holiday,
0:10.1	but we wanted to give you something to listen to today.
0:12.5	Maybe you got a long drive over the holidays.
0:14.9	Maybe you've eaten too much turkey.
0:16.0	Feel a little sleepy.
0:17.1	Well, we have some pretty stimulating economics content
0:20.7	here for you, especially if you have been curious
0:24.2	about what our Planet Money Plus bonus episodes sound like.
0:29.2	This is one of those episodes,
0:31.2	one that we released for Planet Money Plus subscribers back in October,
0:35.2	and now we are excited to give everyone a chance to hear it.
0:38.2	This is just one example of what we do over in that bonus episode feed.
0:42.2	We also do stuff like read, listen, or mail.
0:45.2	We talk about how our show gets made.
0:47.2	We've also experimented with a little movie club,
0:50.2	which has been pretty fun.
0:51.2	And these bonus episodes are just one perk of subscribing to Planet Money Plus.
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1:01.2	And of course, the most important perk of all,
	...

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