< Back

This Week In Your Wallet – May 24, 2011

I woke up this week to the news of the disaster in Joplin, Missouri.  The pictures are devastating.  My thoughts and prayers go out to the people there.  And I’ll be sending some money as well.  If you’d like to join me, you can give directly to redcross.org, call 1-800-REDCROSS or text REDCROSS to 90999 to give $10.

If it seems like there are more natural disasters than there used to be, you’re not imagining things.  According to Oxfam, there are now 400 to 500 events worldwide each year – four to five times the number that occurred at the beginning of the 1980s.  Consider this a nudge to audit your homeowners insurance policy.  If you’ve improved your home since you first purchased your policy, you may need more coverage than you have now.  It’s worth at least asking the question every few years.

So….what else happened this week?

Plastic is Back

Credit card spending is going up.  And the rate at which we’re paying off our balances on those cards is slowing.  What does this mean to you?  If you’re one of those people who pays off your balances in full every month, very little.  But if you revolve:  Start watching your behavior a little more carefully.  I recently moderated a panel at my alma mater, the University of Pennsylvania.  One of the panelists, Wharton Professor Sigal Barsade, made the point – more eloquently than I’ll make it here – that the urge to spend (like the urge to jump into a roaring stock market) is catching.  It’s important to take a deep breath and ask yourself if you can truly afford what you’re doing, preferably before you do it.

Plastic, Part II

Last year’s financial reforms included a requirement that the Federal Reserve limit debit card fees.  The proposal on the table from the Fed is to cap those fees at 12 cents per transaction – almost one-quarter of their average 44 cents now.  The changes are due to hit July 21.  But what does this mean to you and I?  Sandra Block and Jayne O’Donnell laid out five reverberations in USA Today. (Here’s a link if you want to read the whole story.)  They include:

Just Go With It

An interesting new study was released that shows knowing how long an unpleasant event will last doesn’t make it easier to take – it makes it worse.   The always entertaining Christopher Shea wrote about it in the Ideas Market Blog of the Wall Street Journal.  “One hundred and nineteen undergraduates were asked how they thought the experience of listening to pleasant or unpleasant music would be affected by knowing its length…..After sampling 5-second snippets, the students responded as predicted: They thought knowing when the suffering would end would make it easier to bear, and that knowing when the pleasure would end would dampen the fun.” Wrong! When another group of students came in, 50 percent were told of the length of the music clips in advance. Then every few seconds, they stopped to rate their enjoyment. The students who knew when the pleasant song would end actually gave the experience higher ratings than those who didn’t.  Those who knew when the unpleasant one would end gave it worse ratings than those who didn’t.

What does this mean in real life?  My take: Just go with it.  Checking the running times of movies (especially those with so-so reviews) might not be the best strategy.  If you’ve decided you’re going to see that new Kate Hudson flick because you like her and you don’t really care what anyone else says, then just settle in and enjoy the ride.  (P.S. I did see it.  It’s no Sleepless In Seattle, but I’ll happily watch it again when it starts to show up on cable.)

Have a great week!

Jean

Subscribe to my free weekly Newsletter

We collect, use and process your data according to our Privacy Policy.