20 new rules for money; I'm not worthy; Be grateful for what you have; Don't shoot the messenger; An economist eats lunch; Budgeting blunders; Ipad Dad

By Amanda Morrall (email)

1) 20 new rules of money

Have the rules for investing irrevocably changed since the Global Financial Crisis? Some people tend to think so.

Forbes Money, here, puts a case forward for change including the need to abandon the traditional buy and hold strategy, to avoid diversification and to come to terms with permanent volatility.  It also rates tax management as an increasingly important piece of the investment puzzle.

2) Are you worthy?

In very simple terms there are two ways to grow one's money; spending less so you can save more, or earning more so you can increase savings with less sacrifice. I reckon you'll hit your financial sweet spot through a combination of the two.

The following, also published in Forbes Money, suggests this is an unlikely strategy because savers and earners exhibit markedly different personalities and behaviours. Savers tend to be conservative, cautious and thrifty whereas earners are bolder, more confident and more willing to take on risk,  the author argues. Savers, she suggests, are scaredy cats, who can't, won't or don't know how to take charge and change their circumstances for the better.

Which camp do you sit in and are you worthy of that pay rise this year? Go on...

2) Take stock of what you have

Or could it be that savers are merely a more sensible lot who can content themselves with what they do have?

Gratitude certainly goes a long way to curbing unnecessary consumer urges I would argue. A similar view is reflected in this blog from liverealnow.net on how to find happiness outside of materialism.

3) Eye on Aussie

Don't shoot the messenger, please. Personal finance blogger financialsamurai's latest blog extols the benefits of living in Australia. Some interesting stats and information across a range of variables including health, income and taxation.

4) Eat less meat

I must confess, I am not a big fan of agri-business. My contempt comes from reading about suicide seeds and bullying antics from the likes of Monsanto. I suppose I'm one of those "misguided greenies" that likes the idea of buying and supporting local.

George Mason University professor and economist Tyler Cowen, author of an  "An Economist Gets Lunch", says locavores like myself have it wrong and won't be doing the planet any big favours by shunning the mainstream supermarkets. His book argues that the embedded energy costs are much higher for small scale, organic, local food production.

Cowen, in this interview with MSN, argues that do-gooders wanting to save the planet would be better off going vegetarian and riding their bikes. Lord Stern, of the famed Stern Report on Climate Change, made a similar argument if you recall.

5) Budgeting blunders

Budgeting gets a bad rap sometimes. Ironically, the trash talking has come from exasperated financial advisors fed up with seeing budgets botched by financially unrestrained clients. New research from Brigham Young University's Marriott School of Management also casts some doubt as to the effectiveness of budgeting.

This piece, published by the Globe and Mail, explains how budgets can have the opposite intended effect because of the weird underlying psychology at play.

Ipad lovers will be get a kick out of this video. I know I did.

To read other Take Fives by Amanda Morrall click here. You can also follow Amanda on Twitter@amandamorrall

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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There is an illogical part to distingushing between 'Savers' and 'Spenders' as above.
I am a saver and also quite materialistic.  Which is in contradiction to to concepts used in the article.  With some capital, not borrowing and not paying interest costs, I do have much more buying power than if I spent my money immediately.  My life is very pleasant, I have access to good material things, and do access them.  Both goodies and services such as travel.
If you want to be a spender do so.  But recognise that spenders do without many things to be such. So can't be described as materialistic.  It's something else they seek. 

Re 4 - I haven't read Cowen, has he addressed the two big elephants in the room?
One is population - if you double it, then a 50% personal reduction is eliminated.
The other is the peak availability of the fuel that supports BigAg; all bets are off on the downside. On that also, depends the income required to buy the produce. What shunning the su[ermarkets does, is stop one expected 'profit' stream, which is another inevitable drain on energy, when 'spent'.

1. Are you worthy - income growth:  The average wage/salary is quite low in NZ. Particularly for intelligent, reasonably, motivated educated middle-class people who often 'settle' for quite a mediocre income. 
The key is to grow your income via improvement in salary - apply for internal promotion, upgrade your qualifications, take on more responsibility in the hope of the increase coming later.   Or extend your networking in your field  -  become a known expert in your area.
Look for extra income:   2nd job part-time work,  contracting, elance.com, e-commerce website funding your hobby etc.
Go for the long view - get into an industry / organisation with scope for longterm income/career growth.  Recognise when you hit a plateau.
Send your wife/partner to (fulltime)work. Get her to do the above as well.   
Sell 1 item/s for $40 every week on trademe = $2000 annual income tax-free. Sell 1 car - bike to work (for 1 of you).  Make 1 phone call every week to a supplier to reduce a regular cost, e.g. insurance (increase excess, decrease sum insured etc).  
Manage your household like you would a business.
Give to good causes/people in need  -  keeps you looser in attitude ...