Excerpt: 'Mind Over Money: Overcoming the Money Disorders That Threaten Our Financial Health'

July 29, 2009— -- Chapter 1: Information is not enough

The basics of financial health aren't complicated, and they're pretty much the same, no matter who you are or your level of wealth. They are even the same whether you're talking about a person, a family, a company, or a country: Save now and invest for the future. Spend reasonable amounts of money to enjoy life and accomplish your goals, but spend less than you earn. Beware of an investment that looks too good to be true, because it probably is.

Pretty simple, right? So why is it that so many of us can't seem to make those rules work for ourselves? Especially now; at no time in recent history has our collective financial health been more compromised. No matter what measure of disaster you pick—foreclosures, bankruptcies, consumer debt, unemployment—the past two years have set records. (How many times in the last eighteen months have you heard or read the phrase "Not since the Great Depression…"?) Even if your own finances are in order, the uncertainty wears on you; if you were worried about money before, the constant drumbeat of bad news over the past two years has likely been enough to send your stress levels through the roof.

Today, many researchers agree, the biggest source of stress in our lives is money. According to an Associated Press/AOL poll released in June 2008, as many as 16 million Americans suffered from high levels of debt stress and accompanying health complaints. This was a 14 percent increase over a similar 2004 poll. In October 2008, when the American Psychological Association released their annual survey on stress, what do you think was the primary source of stress for Americans? A whopping 80 percent said it was money and the economy. That makes sense given the current financial crisis but it's nothing new. Year after year, through boom and bust, the APA poll has shown that for the large majority of Americans—over 70 percent—money is the number one stressor, ranked higher than work, health, or children. But why?