Round up

5 things on money psychology this month: Aug 2020

Hi, how have you been? This month I stop binge-reading news, and then I binge read on personal finance, which is why this month is about money instead of random lovely things. Here are my top picks from a month’s worth of money psychology reading, and they aren’t about the numbers.

Discussing money as a couple? I love watching this episode of Financially Ever After on how couples resolve money issues.

Although I don’t share my finances with anyone, I do have housemate issues to deal with, and it’s about understanding what money means to them. Money issues are more complicated than income level. One of my housemates earns about three times my pay, but she’ll be willing to spend an extra hour on public transport to save RM3 in the taxi. For me, an hour of my finite life is worth more than RM3.

If you do not have time to watch the video, here’s the key takeaway – consider what money is to you (e.g., therapy, security, power, resource) and give the person who’s supporting your life goals some appreciation today.


Know that It’s not all our fault when we can’t handle money logically. There’s emotion in all the money decisions we made. Why do we go shopping? Do we need affection or take control of our day? I did the Financial Times questionnaire and discover that I am a rainy saver and see money as a game. 😮

It’s exhausting for me to buy big-ticket items because I don’t like to part with money, I like to hoard, hoard, and hoard cash. So true, I tend to mentally crash when I need to decide to buy something above RM150. Secondly, friendship and peer pressure can trigger me to overspend. I love buying gifts for others or join the activities they like, saying yes even to too expensive posh dining. And then regret a bit later 😐 . The assessment is reflective for me; Understanding my spending pattern makes me aware when I am doing “money injustice” to myself or others.


We have been taking the happiness number wrong. Instead of asking how much money makes you happy, ask what makes you happy? Forget about the researched $40,000 or $75,000 happiness threshold; we are all unique.

Our happiness is not what retail outreach or social media comparison tells us. Take a paper and do a happiness chart. Write down what you value and make you happy. Then, move backward and see how much it cost to live the life you value. The number is uniquely your happiness number. And you can make your FIRE decisions based on this number.

If this is too hard, you might want to work on your life’s primary purpose. Money could be important for you to live out your purpose; But, don’t let money substitute your real purpose in life.


We all have some sort of financial plan. Sometimes I make decisions that go against my money goals, and I do them when I am under time-stress, emotional-stress, or sense of scarcity. I made the worst of money decisions when I am in a hurry. I made the biggest impulsive spent when I am emotional.

Stress tends to spiral our decision, including lousy money decisions. Find your trigger and minimize that in your life. Experts in nearly every field agree – It’s not the motivation but habits. This is why it’s best to make savings and investment automated.

I don’t know how to do this yet, but when I am in a hurry or tired, the best thing is to social distance with my wallet or access to money (the phone e-wallet).


Finally, if you can’t seem to spend less than your earning, consider a budget to help to set a virtual boundary. This EveryDollar app works the same as YNAB but without a subscription fee. (About YNAB, I never get why someone who cares about money, pays a subscription to use an app with a basic function.)  Honestly, I don’t like the idea boxing of my spending by categories, which feels very limiting; but I appreciate that a budget helps me to see the bigger picture and take away the small money decisions.


That’s all for August, hope you enjoy the last two long weekend holidays and stay saved!

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