Dan Ariely, a professor of Behavioral Economics at Duke University, says that studies show that when people pay off loans, they pay off the small loans first rather than the loans with the highest interest rate. Studies also show that even when people have debt, they keep a lot of cash. Both of these in combination cost people a lot of money that could be saved if they thought more rationally.
Ariely also believes that the cell phone may be our financial salvation. Through apps that tell you the cost of the item you are purchasing in terms of the cost of your favorite things, and ones where you you pose a financial question and the people that you trust most give you their answers, these types of apps can make people be more rational in the money decisions that they make.
Are you saving too much cash and do you think the cell phone will make us a more financially literate nation?
Jeffrey strain is a freelance author, his work has appeared at The Street.com and seekingalpha.com. In addition to having authored thousands of articles, Jeffrey is a former resident of Japan, former owner of Savingadvice.com and a professional digital nomad.
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