In the book Why Smart People Make Big Money Mistakes, by Gary Belsky and Thomas Gilovich, Simon & Schuster, NY, 1999, offers ideas in the Behavioral Economics format. The authors have some steps to take:

Raise your insurance deductible – to save on insurance costs, raise the deductible from $ 250 to $1,000. By raising the deductible your premium will decrease. If you are an average person, hopefully you never make a claim and the savings over the years will make up for it.

Pay off credit card debt with emergency funds. If you have a rainy day fund and you owe money on credit cards look at both rates. The rainy day fund is giving you a less than 3% interest, the credit cards is cost you plus 15%. (-15 % plus)  Use you rainy day fund to pay off the credit card and save interest costs. Your rainy day fund will be the credit on the card, only make sure the card remains a credit. After you have paid down, if you wish apply for a second card, with no fee, and do no use it, for it is your rainy day fund.

Switch to either dividend funds and/or index funds. Both these funds are good because in the case of dividend funds – the dividends ensure a cash flow and good companies paying dividends are worth more over the years. If you have mutual funds, they try to beat the index, with an index fund it mirrors the index and the fees are lower. If you want to have the others ensure the bulk of your funds stay in dividend and index funds.

Max out on Retirement Plans. Many people work for companies that either offer matching contributions to a retirement fund and/or share purchase plan. Within your budget, go to the maximum of the plan. For example, a company the author works at offers to contribute 25 cents per dollar up to 5% of your salary in a share purchase plan. Many in the company do not participate, but it is a 25% benefit.

Set up a payroll deduction plan There are two keys for this device. One many people consider whatever the money goes into savings, stocks, mutual funds,etc, not to be touched or sacred. The second aspect is then you live off your pay. At the end of the year, you will have greater assets.

Linking to dividend paying stocks, as long as dividend paying stock pay a dividend they are worth keeping. You do not have to consult the stock pages everyday (you can if you wish) for the value is the continuing dividend. If a company can continue its dividend and raise it over the years, then the company is still making money and the shares will be valued accordingly. When the markets go down, the stocks that are not paying dividends or valued on their growth go down the most. The dividends allow for a buffer zone and if the shares go below, then it is a tremendous buying opportunity.

There are more questions than answers, till the next time – to raising questions