Nothing wrong with being emotional about money

2013-04-07 10:00

While completing an online questionnaire about emotions and money, I was not surprised to find that I am very emotional when it comes to money decisions.

Most of us are.

For example, one question asked whether I would use my bonus to pay for a life-saving operation for my dog. Of course, I would. I love my dog.

Almost prophetically, a few days earlier I had taken my very ill dog to the vet and was told she had to have a serious operation. I did not hesitate.

The truth is I would have taken out a personal loan to pay for the operation because it is an emotional decision and there is no reasoning with emotion.

Other questions included whether I would help out my normally responsible son whose car had broken down, or buy a nice lunch for a broke friend.

I answered yes to both.

How is it possible to be a sensible financial journalist with strict money management rules and zero tolerance for debt, yet be completely emotional about money?

While there is no contradiction here, there is nothing wrong with being emotional about money. What is the point of money if we cannot use it to help others?

The answer is not to be less emotional, but to be aware of our emotional responses and to be prepared for the financial consequences.

When faced with the major bill from the vet, I closed my eyes and gave thanks that not only had I taken out pet insurance, but that I had built up my emergency funds and was able to absorb the double whammy of vet bills and a car accident in one month.

Bills that would normally max out my credit card are nothing but a small blimp which I can slowly repay back into my emergency fund, rather than paying exorbitant interest rates and having the bank banging on the door.

That emergency fund did not appear overnight. It took several years to build up to the recommended three months of expenses. In fact, the last hurdle was only reached a couple of months ago when I renewed my motivation after editing the Total Money Makeover.

I made sacrifices, cut back and made sure my emergency fund was fully operational. Now I will need to focus on building it back, but the motivation is there, knowing that it allows me to remain as emotional and irrational as I choose to be.

Here’s how to start an emergency fund:

» Even if you are focused on paying off your debts, make sure you are building up an emergency fund so that an unexpected event doesn’t put you further into debt;

» Start small – your first step is to have R1?000 in an easily accessible, no-fee account and build it up until you have R10?000 as a buffer; and

» Once you’ve settled your debts, you can start on the larger goal of having at least three months of living expenses put aside.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Comments have been closed for this article.

Inside News24

 
/News

Book flights

Compare, Book, Fly

Traffic Alerts
There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.




Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.