Why We're Irrational with Money - with Kristen Berman

Afford Anything | Make Smart Money Choices

Paula Pant | Cumulus Podcast Network

Entrepreneurship, Investing, Business

4.7 • 3.6K Ratings

🗓️ 4 October 2019

⏱️ 61 minutes

🔗️ Recording | iTunes | RSS

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Summary

#218: Kristen Berman is co-founder of Irrational Labs, a behavioral product design company, along with Dan Ariely. She has a fascinating job that involves looking into why people behave the way they do with their money, and discovering the easiest solution to help them create more positive financial behavior. In short, she’s a proponent of redesigning the current financial system to make saving automatic and easy, and that’s part of what we discuss in this episode. If creating better financial habits has been a challenge for you, or if you have trouble framing spending as a positive thing, rather than a loss, then Kristen has awesome advice for you. Here are some key takeaways from the interview: 1. Habits are overrated - one-time decisions are more effective. 2. Simplify decision-making by giving yourself a rule-of-thumb to follow. 3. Pre-commit to your financial goals. 4. Measure process versus outcome. 5. Use accountability partners to reach your goals. 6. The Three Bs - Behavior, Barriers, and Benefits. For more information, visit the show notes at https://affordanything.com/episode218 Learn more about your ad choices. Visit podcastchoices.com/adchoices

Transcript

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0:00.0	You can afford anything but not everything.
0:10.9	Every decision that you make is a trade-off against something else, and that is true not
0:14.9	only for your money, but also your attention, your energy, your focus, your time, anything
0:21.4	in your life that's a scarce resource that you need to manage.
0:25.1	That leads to two questions.
0:26.4	Number one, what do you value most and not what the society tell you you should value
0:31.3	most, but what do you genuinely, authentically value most in your life?
0:35.6	And number two, how do you align your behaviors to reflect those values?
0:41.6	Now answering those two questions requires a lifetime of daily practice, and that is what
0:45.8	this podcast is here to explore.
0:47.9	My name is Paula Pant, I'm the host of the Afford Anything podcast.
0:51.2	Normally, we are a weekly show.
0:52.6	We air every Monday morning, but once a month, on the first Friday of the month, we air
0:56.8	a first Friday bonus episode.
0:58.2	So welcome to the October 2019 first Friday bonus episode.
1:03.4	Today, Kristen Berman joins us to talk about why we act the way we do when it comes to
1:09.0	the way that we spend.
1:10.4	Kristen Berman, along with Dan Airelli, are the co-founders of irrational labs, a nonprofit
1:16.1	that tries to figure out why people act the way they do.
1:19.4	Many of you are probably familiar with the name Dan Airelli.
1:22.0	He's a bit of a celebrity in this niche.
1:24.2	He's the author of Predictably Irrational, which is a book published in 2008 that became
	...

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