In response to my last post about Jean Chatzky's delightful new book, "MoneyRules: The Simple Path to Lifelong Security", many of your wrote to me to share the money rules that had made the biggest difference in your life. That got me thinking, "What are Jean Chatzky's favorite money rules?" After all, as the financial editor for The Today Show and author of numerous best-selling personal finance books, Jean has had a birds-eye view of our nation's personal finances over the past few decades.

Jean Chatzky

And what a journey it's been. As Professor Joseph Stiglitz noted in a (must read) article in Vanity Fair, according to research by his Columbia University colleague Bruce Greenwald, in the years leading up to the recession, 80 percent of the American population had been spending around 110 percent of its income. Yikes. That's certainly a recipe for financial angst, and a good reason for us all to celebrate National Financial Literacy Month with a serving of Money Rules. Lucky for us, Jean was kind enough to share her three favorites. (Although she did note that like a proud parent, it was tough to choose - and that in addition to the 94 gems that are in the book, there were a good 40 more tips that didn't make the final edit due to space constraints). Here are Jean's top three picks: Jean Chatzky's Money Rule #11: If you can't see it and you can't touch it, you won't spend it. Jean says, "The Money Rules all work. I love this one because it works so well -- and because there is a bounty of research on how effective automatic enrollment and auto-escalation in 401(k) plans has proven to be, to back that statement up. The trick is to replicate the 401(k) mechanism in other areas of your life. This is how I funded college for my kids. The money was swiped automatically into a 529 where I couldn't touch it without penalty. I didn't miss it as it moved. But today when I visit my 529s, it always puts a smile on my face." Jean Chatzky's Money Rule #26: Just because someone will lend it to you, doesn't mean you should borrow it. Jean says: "This is one of my favorites because I think it's the defining lesson of the last few years. As we move forward and credit loosens up again and those solicitations start to flood our mailboxes, I hope we'll remember it!" Jean Chatzky's Money Rule #49: Don't budget while you're dieting. Don't diet while your budgeting. Jean says: "This one speaks to me because it reminds me that we're all human. We can't, research tells us, do it all at once. We can work on our willpower, work on building good habits that will take us where we want to go. But in the end, we have to remember that we're not going to be perfect. If we fall back, we need to give ourselves a break, take a deep breath, and try once again." For more Money Rules, be sure to check out Jean's latest book. It's a great way to kick off spring-cleaning your finances. [This post originally appeared at ManishaThakor.com]. For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor, on Facebook at /ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
When economic times were flush, it felt relatively easy to figure out the next financial move to make. Today it feels like many of us are on a rapidly moving financial freeway with poor money signage. Should you pay off student loan debt or start saving for retirement? Should you save for your child's education or save for your retirement? Should you buy a home, and if so, how much can you afford? We all need sound money guidance and clear direction. Thankfully, Jean Chatzky has a new book out called "Money Rules: the simple path to lifelong security" which gives us precisely that. In this slim guide, rich with wisdom, Jean gives 94 simple guidelines to restore financial sanity to your life. To kick off Financial Literacy Month, here are 3 of my favorite "Money Rules" from Jean's delightful book. 1. The More Time You Spend Looking, The Less Happy You'll Be With What You Find. Jean highlights research showing that college grads searching intently for the perfect job tended to earn 20% more, but were not happier than their peers who were content with "good enough." Amen, sista! In a land were almost anything is possible, it can often feel like nothing is enough. I've found that setting boundaries, from the amount of time you will allow yourself to research an item you are shopping for, to a dollar amount you will spend on a vacation, shifts your focus to maximizing what you currently have. That in turn can dramatically increase what I call your "money-joy return on investment." 2. Live Below Your Means. Period. Jean suggests striving to save at least 10% of what you earn (and ups that to 15% if you are 35 years or older and are just starting to save). Alas, most of us are not doing this. As Jean points out in another rule I love ("The Joneses Are In Debt"), in the US roughly 115 million of us have credit card debt, and amongst this group the average debt per household is over $15,000. Personally, I think a big culprit is unrealistic media images. I've long wished there'd be an academic study that adds up the real cost of what it would take to maintain the kind of "middle class" lifestyle portrayed in many of the police or medical dramas. My hunch is that this lifestyle would cost 30-50% more than what those jobs could realistically support. Women have long been tormented by trying to look like models in magazines - models who themselves don't really look like that because their images were airbrushed. The same goes for our national perception of what realistic "average" lives look like, thanks to Media Gone Wild. 3. Boring Is Better. Jean says this in the section devoted to investment advice, and as a former active portfolio manager I couldn't agree more. Over the long run, study after study shows that low-cost, highly diversified - but B.O.R.I.N.G. investments such as broad based index funds and ETFs out perform their sexier siblings, such as the hot stocks or investment themes of the year. To me, it's like two cars driving along a toll road. One is going super fast, weaving in and out of traffic. The other is going steady at speed limit. They both arrive at the toll booth around the same time, but guess who is calmer, and whose car is in better condition? Yep, the boring driver. Same goes for investing. For more Money Rules of the road, have your own private Financial Literacy Month Celebration by treating yourself to a copy of Jean's latest book. [This post originally appeared at ManishaThakor.com]. For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor, on Facebook at /ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
Have you ever wondered how your life might be different if you had "All The Money In The World?" In her new book by that same name, Laura Vanderkam turns that question on its head. Instead, Laura, who is also the critically-acclaimed author of "168 Hours: You Have More Time Than You Think", and a member of USA Today's Board of Contributors asks...

"What do the happiest people in the world know about money?"

I love this question because while only 400 people can end up on the Forbes 400 list, there is no limit to how many of us can use money more wisely to increase our personal happiness. Laura's book is filled with insights about ways in which you can shift your thinking about - and use of - money to add more joy to your life. This issue of how to find financial security and serenity in a post-2008 economy is one I've been thinking about a lot lately as I am developing my new MoneyZen methodology. So, I was excited when Laura agreed to answer five questions that can help each of use redefine our relationship with money to one that maximizes our personal priorities and interests.

Manisha: With the relative prosperity of the U.S., why do so many of us experience a sense of lack? Laura: This sense of lack stems from two sources. The first is choosing a problematic reference group. If you compare yourself to the people you see on TV -- that is, if you try to keep up with the Kardashians and their ilk -- you can feel dissatisfied. But if you compare yourself to the billions of people on this planet who live on less than $2 a day, you’ll feel indescribably rich. You can choose either reference group, but one will make you feel much more blessed. Second, even if we realize that we do have enough, we have a tendency to overspend on big ticket items that we get used to over time: the house, the car, diamond engagement rings. Spending less on these categories frees up cash to splurge on little indulgences that will make us happy every time: going out with friends, vacations, charity, even something like a painting class. Manisha: What kind of mindset shift needs to happen for us to relate to money from a place of joy? Laura: We need to recognize that money is just a means of exchange. Stripped of all the drama, it is simply a tool. Since it is a tool, we can use it to help us build the lives we want. When you look at it that way, you realize that money is powerful, but it’s most powerful when you put it to use to build a better life for you and the people you care about. Manisha: What is the significance of pursuing your passions in creating a joyful relationship to money? Laura: I think there is significance on both the spending side and the earning side. On the spending side, if you read too many frugality blogs, you start to forget that money is there to be used. I think people spend money most wisely when they figure out exactly what makes them happy -- trips to an art museum, for instance, or maybe gourmet food -- and then spend a lot on those categories, and as little as possible on other things. On the earning side, being in the right job can definitely give you a joyful relationship with money. Manisha: How do you relate to money in ways that are personally meaningful? Laura: I’ve learned that spending money in a few ways is guaranteed to bring me happiness. First, I spend on my social network. Throwing parties, going out with friends for lunch, or donating to organizations I volunteer with all give a big happiness bang for my buck. Second, I spend on experiences. Travel is worth doing right. And finally, I spend to buy myself time. We all have 168 hours a week, and all the money in the world can’t buy us a second more, but money can buy back time from chores to do other things. [This post originally appeared at ManishaThakor.com]. For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor, on Facebook at /ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
Last week my hubby and I had dinner with our dear friends Harry and Olivia. Towards the end of the meal Harry asked a very interesting question. "When you pick up a menu, what side do you look at first - the right or the left?" Harry and I immediately said "the right" while my hubby and Olivia both said "the left." What's on the right side of a menu? The prices! What's on the left? The food! Harry's question beautifully highlights a trend academics have long noticed - namely that we are often attracted to our financial opposites when it comes to financial behavior. Our dinner conversation inspired me to consider other areas of our finances where behavioral patterns play a significant roll. Digging around, I was thrilled to discover fresh insights from Carl Richards* in his fantastic new book, The Behavior Gap: simple ways to stop doing dumb things with money. [*Carl Richards is a CFP, founder of Prasada Capital Management, and regular contributor to the New York Times Bucks Blog and NPR's Marketplace Money. Carl is also famous for making his pithy points using a sharpie and a cocktail napkin.] The Behavior Gap is the best combination of practical advice and emotional encouragement that I've seen in a personal finance book in quite some time. After reading this compelling work, I asked Carl some questions about his unique approach to assessing financial behavior: MANISHA:  In THE BEHAVIOR GAP you state, "Our conversations about money often leave us feeling confused, misunderstood, and even angry". Why is this and what can we do about it?
CARL: Growing up most of us were taught that money, sex, and politics were not talked about in polite company, and see what that did to us! We have never really talked about money, and when we do, we expect it to be like math or spreadsheets...unemotional! Well, anyone who has been awake the last few years knows money is emotional! Changing this is simple...but not easy: start talking about it. Start with talking about where you are today, where you want to go. Give yourself permission to start exploring your relationship with money so you can change it!
MANISHA: One of my favorite points you make in THE BEHAVIOR GAP is "You're Responsible For Your Behavior." What behaviors do you find people most resistant to taking ownership of or changing?
CARL: Almost everything. Spending less than you earn. Saving. Investing with discipline. It is so much easier to blame others for our mistakes, big bad banks, Wall Street, credit card companies...but it does us NO good (even if its true). Better to just own up to it, learn from the mistake and move on!
MANISHA: Of all the drawings you've created for THE BEHAVIOR GAP, when it comes to people finding true financial peace of mind, which one is your favorite and why?
CARL: Are you kidding! That is like asking someone to pick there favorite child, you might have one, but you could never admit it in public! Actually the sketch on page 62 (and to the right) is one that I try to remember everyday. We somehow forgot that the best source of happiness is SO SIMPLE: time with people we love! Of course we try to make it complicated and expensive...but it's not. I asked one of my kids what their favorite memory of the summer was one year after we had taken a few trips and guess what he remembered? The time we spent throwing rocks in the pond! Not the trips! Not the hotels! Rocks and water? The reality is that it wasn't about the rocks and the water either, it was about time together with people you love!
As I continue on with "MoneyZen" - my quest to help us all find less financial stress and more life joy, I am struck by the degree to which simply reflecting upon our behavioral patterns around personal finance can lead to greater personal fulfillment. Reading Carl's delightful new book is a great way to jump start that process! Have you shifted any financial habits lately that have led to great happiness? [This post originally appeared at ManishaThakor.com.] For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor on Facebook at ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
Are you feeling last minute holiday shopping stress?  If so, you are not alone.  This blog post can help. The other day my sweet hubby emailed me two links. The first ("Shoppers Forgo Basics For Presents") was a gut-wrenching read. It was a powerful reminder of how easy it is during the holiday season to go off base with our spending. The second ("All I Want For Christmas Is You") was an uplifting song from Mariah Carey. It flipped my mood 180 degrees by reminding me that what most of us really want from the holidays is just to be happy and around the people we love. So often personal finance can feel like it has absolutely nothing to do with personal fulfillment (or holiday joy). Managing our money can not only feel tedious and overwhelming, but pointless in the whole scope of life. Enter Kimberly Palmer. A veteran journalist (at US News & World Report) and author (of the delightful book GENERATION EARN), Kimberly has launched a line of financial planners that I just love.  Not only are they affordable and effective but they address head on the whole point of money management... to help you live the life that makes your heart sing. Kimberly was kind enough to share with us the thought process behind her latest entrepreneurial venture. (1) What inspired you to create Palmer's Planners? KIM: I love the creative aspect of managing money: Brainstorming about big money goals, coming up with new ways to earn money, and celebrating progress towards milestones. I created the planners to focus on that aspect of money management, instead of the pure number-crunching side, because I know other right-brainers like me feel the same way. (2) How much time will it take to utilize them? KIM: My 2012 Money Planner is organized as a month-by-month guide for next year, so it’s designed to be used throughout the twelve months. But my other planners, including the Debt-Free Planner, Money Planner, and Baby Planner, are organized around specific goals or events (such as paying off debt or affording a baby), so people can use them as they are navigating those things. The planners have plenty of space for personalization and customization, so people can take notes and track their own goals. (3) What is the biggest upside that people will experience from using Palmer's Planners? KIM: My goal is to help people get organized as they tackle big life events and goals, because after writing about personal finance for five years, I’ve come to believe that getting organized is the single most important thing you can do for yourself financially. People who know what their goals are, have their paperwork in order, and pay their bills each month have a much easier time staying on top of our increasingly complicated financial world. (4) From your years of interviewing - both as a reporter and an author - what is the biggest obstacle people face when it comes to acting on basic financial advice? KIM: Dedicating time to getting on top of your financial life on a regular basis. So many of us know what we “should” do and maybe even what we want to do, but actually setting aside time to take concrete steps, whether it’s setting up bills for automatic payment or rebalancing our retirement portfolios, can be harder to schedule than an annual physical. That’s why I like the idea of making a date with yourself, say once a month, to sit down and take a few steps towards a healthier financial life. (5) If someone wanted to give a planner as a holiday gift, which one would you suggest and why? KIM: My favorite for gifts is the Money Planner, which is available as a booklet (as well as in digital form), because even in our digital world, some people still like to have something concrete to wrap up and hand to someone! [This post originally appeared at ManishaThakor.com.] For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor on Facebook at ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
Would you like to experience less (financial) stress and more (money) joy this holiday season? If you're a flexible spending account (FSA) user, there's an easy way for you to get both: take a look at your current FSA account balance and spend down any remaining funds. Yes, you heard that correctly. I'm encouraging you to SPEND! The reason is that if you don't spend all of the money in your FSA by the end of your plan year, that money will be forfeited as a result of the "use it or lose it" rule. Here's a simple 6-point plan you can follow to spend down those remaining FSA dollars in less than an hour.
  1. Find Out How Much You Can Spend. Call your provider or check your most recent paper or online statement to find out what your remaining FSA balance is.  Some FSA administrators, such as WageWorks (a firm I'm proud to work with on consumer awareness) even give you the option of using your smart phone or other mobile device to log in to your account. Time: 5 minutes.
  2. Find Out Your “Spend By” Date. Reach out to your benefits or HR department to find out if you must spend your FSA dollars by December 31st or whether your workplace gives you a “grace period” until March 15th.  Also, take note of your final day to make purchases versus your final day to request reimbursement; your employer may offer some flexibility there as well. Time: 5 minutes.
  3. Review Eligible Expenses. Now that you know how much you have to spend and by when, it’s time to start using whatever funds are left. Review the extensive list of FSA eligible expenses and create a list of what you need. Two sites with great lists of eligible expenses and other resources include SaveSmartSpendHealthy.com and WageWorks.com/spendit. Time:  10 minutes.
  4. Look For Any Gaps. Sit down and review your medical care from the past year.  Are there any expenses you haven’t submitted yet? Are there any appointments you haven't had yet such as routine dental or eye exams?  If so, call your providers and get those on the calendar. Time:  10 minutes.
  5. Restock OTC Items. In addition to items you may have identified in the previous step, don't forget to restock commonly-used OTC products and medications, (Note, as of January 1, 2011 OTC medications require a doctor's prescription to qualify for FSA reimbursement.) And if the thought of braving holiday crowds is making you feel slightly nauseous, not to worry. You can shop online with companies like FSAStore.com from the comfort of your couch. Time (including check out!): 15 minutes.
  6. Claim Your Miles: Did you know you can get a tax-break on any miles you had to drive for any doctors appointments or pharmacy visit in the past year? Reimbursement for travel between January 1 and June 30, 2011 is set at 19 cents per mile, and travel between July 1 and December 31, 2011 was increased to 23.5 cents per mile.  To make this a super easy process, just use an online directions website such as [entity display="Google" type="organization" subtype="company" active="true" key="google" ticker="GOOG" exchange="NASDAQ"]Google[/entity] Maps or MapQuest and enter your start and finish addresses. Print off the resulting map (which will show point-to-point mileage) and submit it to your FSA provider along with the receipts for the associated doctor or pharmacy visit. Time: 10 minutes.
By the way, if you are wondering what the logic is behind the whole “use it or lose it” rule - I hear you loud and clear. Personally, I'd much rather see the government allow us to either cash out balances at year-end (paying our fair share of taxes on that amount) or roll it over to the next plan year. If you agree with me, you can visit SaveMyFlexPlan.org for more information on how you can make your voice heard on this issue. Here's to a 2012 full of health, happiness, and financial peace of mind! [This post originally appeared at ManishaThakor.com.] For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor on Facebook at ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.

photo by Juliancolton2

“Where is the Life we have lost in living? Where is the wisdom we have lost in knowledge? Where is the knowledge we have lost in information?” -T.S. Eliot Reading these beautiful words from T.S. Eliot, I am struck by how well they describe our current relationship with money. With so many personal finance books, magazines, shows and blogs presenting information, we women should feel confident in the knowledge that our finances are in order, right? After a 15-year career in the institutional financial services world, I've spent the past few years traveling the country teaching, writing, and speaking about the basics of personal finance for women. The overriding sentiment I'm encountering is... OVERWHELM. There is so much financial information out there, but some how it feels sadly cut off from the process of life and living. For years I've said the three most powerful words in personal finance are "Start Saving Now." From a purely left brain perspective this remains true. A dollar you save and invest in your 20s will have nearly five times the power of a dollar you invest in your 40s, assuming a 7% return across all time periods. Invest $1,000 a year starting at age 20, earning 7% and at age 65 you'll have $285,000.  Invest that same $1,000 a year starting at age 40 and also earning 7% and at age 65 you'll have just $63,000. Key point - you end up with 4.5 times MORE money by starting to save the $1,000 a year in your 20s. Those numbers are powerful. But they are often not enough to inspire action. My hunch is that it is because these numbers do not touch our souls. Even for those who like math, those figures can seem oddly devoid of joy and life energy. An equation that results in "more" - but doesn't tells more WHAT. Enter "MoneyZen." Let's start with the notion that money is energy. We earn money in exchange for our time spent working. So when we spend it we are spending our life's energy (for more on this concept, read Your Money Or Your Life). Taken further, if we are all connected to a greater source (God, unified field, etc) then money is part of this collective whole as well.  Which gives it a spiritual quality that responds to gentleness and reflection. Now let's go back to saving. How much should you strive to save? My current thinking, inspired by Elizabeth & Amelia Warren's All Your Worth is that a healthy allocation for your after-tax income looks like this:  20% savings, 30% wants, 50% needs. Of that 20% savings, roughly half goes for retirement and the remainder for nearer term needs. By WHY are you saving? I have come to view saving as process of honoring the energy that connects us all. Putting some money aside is a form of self-care.  It goes beyond simply creating an emergency fund and preparing for some well deserved rest in retirement. I've come to view saving as a physical manifestation of respect for the way you've spent your life's energy. By saving you are saying you want to lengthen the time over which you will experience the joy that arises from your earnings. By saving you are also trusting in the future, having the confidence to both enjoy yourself today while also setting some energy aside for additional joy down the road. So how do you get started saving? By spending less than you earn. There are many programs and tools available to help you do this (ranging from Mint.com to the old fashioned pen, paper, and excel method that I use).  But the real financial force comes from having the quiet wisdom that stems from understanding why at the most basic and human level you are saving to begin with. How do you spend less than you earn? By harnessing the quiet wisdom of saving. [This piece originally appeared as a guest post at GoGirlFinance.com, a website Manisha loves. Follow them on Twitter @GoGirlFinance]. For more of Manisha's MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor, on Facebook at /ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
Can focusing on your health help you to pay less in taxes?  If your employer offers a healthcare flexible spending account ("FSA") and you elect to participate, the answer is yes! Toward the end of the year I am frequently asked about ways to lower minimize the burden of taxes. That's a logical query. After all, it's not what you earn that puts food on your table, but what you get to keep after Uncle Sam takes his cut. When it comes to tax breaks most people think of the mortgage interest deduction and charitable contributions. Those are certainly common and valuable ones. However, often overlooked health care FSAs have the ability to get you a tax break of up to 40 percent on many of your routine health-related expenses. How does this work? Healthcare FSAs (as well as also valuable dependent care and commuter accounts) allow you to cover eligible expenses with money that is taken out of your paycheck before taxes. That means every penny of each dollar you earn is available to spend on eligible health care expenses. Nothing is put aside for Uncle Sam. While the most common covered expenses include co-pays, prescription drugs and dental and vision care, here are the top 5 items you likely didn't know were covered with a health care FSA:
  1. Acupuncture treatments – Therapies such as acupuncture, chiropractor and even doctor-recommended massage can be very beneficial but may not be covered by insurance. An FSA can help you to pay and save on these costly treatments.
  2. Doctor-ordered weight loss programs – Maintaining a healthy weight is an important part of your overall health, yet two-thirds of adults in the US are overweight. If weight loss is a goal for you and your doctor recommends that you join a weight-loss program, you can use your FSA to pay the enrollment and other fees.
  3. Gluten free food items – If someone in your family has Celiac’s Disease or a gluten allergy, you can be reimbursed for some of the cost of gluten-free food items. Whenever you purchase a gluten-free food item, compare the cost to a similar item with gluten. The price difference can be covered with your FSA.
  4. Mileage to/from medical appointments Any trips you make to your doctor’s office, the pharmacy or other areas where you receive medical care can be reimbursed at 19 cents per mile.
  5. Smoking cessation programs – According to the American Cancer Society, more than half of all smokers have attempted to quit in the past year. A cessation program may be what you need to quit for good, and you can pay for it tax-free if you use your FSA.
As open enrollment season begins to wrap up, so does your window for signing up for a health care FSA.  Keep in mind that while individual employers currently set the limit on how much can be put aside in an FSA, starting in 2013 the federal government will cap employee contributions at $2,500 per year.  Given this, you may want to put aside a larger amount this year if you are interested in getting LASIK or other more costly procedures in 2012. To learn more about pre-tax benefits, like health care FSAs, invest a little time on a site like SaveSmartSpendHealthy.com or ask about it at work. You may be shocked to realize that you could be saving up to 40 percent on many of your routine health care, dependent care and commuting expenses. In the end, signing up for a health care FSA can make a lot sense for you and your family.  Saving more and paying less in taxes while simultaneously taking care of your health is a surefire prescription for increased happiness! [This post originally appeared at ManishaThakor.com.] For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor on Facebook at ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
What can four drunk airplane passengers, first time parents, and a delightful new book called Celebrity, Inc. do for your wallet? Plenty. Let me start with the drunks and new parents. Monday night I boarded a very delayed flight from Houston to Los Angeles. Behind me were four 20/30-somethings boisterously swigging from "coffee" cups. (Our gate was across from a Cantina and you could practically smell the tequila in their paper cups.) As the boarding continued they grew increasingly animated. Their frenetic energy seemed to wind up not just each other but everyone around them. Fellow passengers were visibly agitated. Just before the plane doors closed, a young couple came on with a sleeping baby. The last two open seats were amongst this motley crew. Suddenly, everything changed. The presence of the earnest and exhausted parents had an immediate calming effect on both the inebriated passengers and those around them. It was as if a mirror had been placed in the center of the plane to remind us all of our humanity. Enter, Jo Piazza's delicious new book, Celebrity, Inc: how famous people make money. To me, this book is the figurative version of the newborn's parents getting on the plane. It serves as a mirror reflecting back the reality what's in the "coffee" cups of the celebrity scene. That got me wondering what other financial lessons the author of Celebrity, Inc. might have stumbled across while writing this fascinating book. Thankfully, Jo Piazza was willing to share with us... Q: Of the celebrities you profile in Celebrity, Inc. whose money attitude were you most impressed with and why?

Jo: Despite current controversy I was completely impressed with the Kardashian's money attitude and their work ethic. I have never met a celebrity crew who works so hard to maintain their brand. I don't necessarily agree with the massive amounts they are paid to do what they do, but unlike a lot of celebs they truly do work for it. And beyond that they manage their money well. They budget, they funnel funds back into new projects, they try not to spend excessively and they do donate a portion of their income to charity each year.

(2) What surprised you the most about the money habits you observed during your Celebrity, Inc. research?

Jo:  So many of the people I talked to over-spent their budgets on a consistent basis even though they were making crazy amounts of money. Spencer Pratt told me he and Heidi Montag pulled in about $10 million in 4 years but because they thought it would keep coming at the same rate they blew through it all. That's a common thread I found with a lot of celebs. They're making so much but they're spending just as quickly. They buy $5 million houses and spend half a million on a security detail and they rarely save a dime. I just don't think they realize the shelf life of fame is shorter than ever and they may not be famous tomorrow.

(3) What personal finance lessons do you think the rest of us can take away from the way famous people live their lives?

Jo: Budgeting for a rainy day is the best thing we can learn from celebrities in terms of personal finance. I saw so many cases of celebs who thought it would last forever and then forever came up really... quick.

I was inspired by the extent to which celebs expand their personal brands. Tim McGraw went from country singer to fragrance king. When Valerie Bertinelli's career as an actress seemed like it was over she reinvented herself through a weight loss campaign. I don't think we see these instances of celeb entrepreneurship as inspiring enough and I truly think they should be a lesson in taking chances, building a new business and making lemonade out of lemons.

In many ways our celebrity culture is like a group of chaotic drunk people. It lurches rapidly from one topic and fad to the next. In the heat of the excitement money can feel like no object. But the financial hangover of being, or trying to emulate, that lifestyle can result in a serious financial crash. So pick up a copy of Celebrity, Inc. and tell me what you think. Does our national obsession with the lifestyles of the rich and famous ever cause you to do things with your money that you later regret? [This post originally appeared at ManishaThakor.com.] For more MoneyZen in your life, follow Manisha on Twitter at @ManishaThakor on Facebook at ManishaThakor or sign up to receive Manisha's MoneyZen blog via email by clicking here.
My husband and I recently finished a 2,200 mile motorcycle ride from Seattle, WA to Santa Fe, NM. Our journey was part vacation and part intervention for my ongoing struggle with workaholism. On the back of the bike, all I could do was be in the moment. Without the constant stimulation of modern digital life bombarding me with offers and information, my point of comparison for personal happiness shifted to the present. Without the protection a train, plane, or automobile to shield me from contact with nature, I experienced all kinds of interactions. To my surprise, the result was... joy. This led me to wonder: Could a large part of our current financial angst be caused by false comparisons and a lack of true human connection? As we road down the coastline in Washington, Oregon, and Northern California we spent a great deal of time in sparsely inhabited terrain. For long stretches there was nothing to look at but the stunning beauty of the rocky coastline. When we would enter a town, the billboards, shops, and activity felt jarring next to the peace and quiet of the open road. After repeating this cycle several times, I noticed a pattern.  I felt much more content in nature. The more posh or commercial the town we road through, the more thoughts of wants, unmet desires, and surprising needs would bubble up. By around the tenth time this happened I could see how complete I felt in nature - and how unknown material hungers arose in civilization. In modern life, we so often compare ourselves not just to the Joneses next door, but to the lives of the Catherine Zeta-Joneses...the rich and famous. When see the discrepancy, we feel lack. Yet as the data in this wonderful article by veteran journalist Scott Burns shows, 50% of households earn less than $33,000 a year and 75% of households earn less than $66,000 a year. By contrast, the "average" lifestyles portrayed in mainstream media would require incomes well into the six-digits to replicate. Yet you have to get to the top 5% of households before you start seeing regular incomes of $150,000 plus. Modern digital life has flooded us with images of "average" lifestyles that are far beyond reach for the majority of people. So, we end up judging our success or happiness against images that are false comparisons. As we turned inland and traversed through Nevada, Arizona, and New Mexico, I noticed another phenomenon. At virtually every gas station we stopped at people came up to talk to us about the bike, our trip, or just to say hello. I can't remember the last time I just started talking to a random person when I pull my car up to my local gas station! There's something about being out in the open on a bike that inspires people to come over and chat the way a friendly dog in a park might encourage you to come over and pet him. We had some delightful conversations. Invariably after a pleasant exchange, I felt a sense of calm connection washing over me that is sorely lacking in my normal workdays. We spend so much of our time enclosed in various modes of transportation and attached to digital devices that raw, spontaneous human connection has become a rarity. Lacking that emotional nourishment, we fill ourselves up in other ways: shopping, consuming, striving, and achieving. Stagnating happiness levels may well be the result. Have you noticed places in your own life where you'd like to let go of making comparisons and cultivate deeper connections with others? If so, would your spending patterns change at all? [This post originally appeared at ManishaThakor.com.] Want to join the journey to MoneyZen? You can follow personal finance expert & author, Manisha Thakor, on Twitter at @ManishaThakor or sign up to get her MoneyZen email updates delivered right to your inbox by clicking here.