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Psych Yourself Rich Book Review and Farnoosh Torabi Interview

psych yourself rich book coverHow much personal finance information do people really need? After all, the Internet is chock full of free personal finance advice, ranging from suggestions on consumer rights and how to avoid scams from the Federal Trade Commission, to targeted investment advice over at the The Motley Fool. For many, the problem isn’t ignorance of smart money management, it’s actually taking the initiative to put that knowledge into practice. For example, many people understand that credit card balances need to stay below 30% of the limit to achieve a decent credit score, but they still manage to max out the cards anyway.

So if people know about good money management, why is it that they continue making the same mistakes? Why do they keep themselves in financial chaos?

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Financial journalist Farnoosh Torabi tackles this question in her book, Psych Yourself Rich. She’s figured out that financially distressed people don’t need more information about money, but a different way of thinking about it. Here is a summary of her theory, and how it can be put into practice.

Adjust Your Financial Attitude

farnoosh torabi headshotFarnoosh Torabi asserts that by changing your attitude toward money, savings, credit, and spending, you can put what you know about it to good use. Until that change in thinking happens, however, the same old behaviors will continue. As the book’s title suggests, the ability to manage money is driven by psychological factors, which are largely the product of life experiences and relationships with others, rather than what is gleaned from seeking out expert advice. The biggest factor affecting modern attitudes about money is the tendency to avoid the topic altogether.

Breaking the Money Taboo

Middle-class America’s discomfort with talking about money hasn’t done society any favors. While I’m all for not being crass by discussing salaries and large purchases in polite company, considering money a more taboo topic than sex fosters an unhealthy relationship between ourselves and our pocketbooks.

In fact, this behavior teaches you to mentally sequester your wealth (or lack of it), from the way you make everyday decisions that directly affect your finances. The disconnect is why people choose to enjoy an expensive restaurant meal, even though they know deep down that paying for it will mean they won’t be able to make rent at the end of the month.

Regret over the pricey dinner may hit later, but why wasn’t the pain of the financial blow considered before the meal was even ordered? Could it be that we are so divorced from our finances that we need the imminent threat of disaster (e.g. eviction for tenants) to make us feel our financial blunders?

Torabi recognizes this discomfort with money and urges readers to work past it. Once you begin to integrate how you think about money into how you think about your daily life choices, you can catch yourself before digging a deeper financial hole. (Heck, eventually, you may even begin to make choices that will make you money).

Each chapter of Psych Yourself Rich focuses on a different step in challenging yourself to really consider your attitudes toward money and your ability to effectively manage your finances. Farnoosh Torabi helps readers to recognize obligations and develop financial goals (while not confusing the two). Torabi then provides the skills to start putting these new perspectives to work.

The Importance of Self Advocacy

My favorite chapter in the book is Chapter 6, “Be Your Biggest Advocate.” Here Torabi shows how to be a financial self-advocate, and actively manage and control your financial situation, rather than letting circumstances (including the amount of money you earn) dictate your behavior. She combines some real life stories of self advocacy with pointers to resources you can use to help get your own financial life in order. Even if you don’t get through the whole book, if you are serious about getting it together financially, read this chapter.

Final Word

Psych Yourself Rich teaches that you are ultimately responsible for making your own financial decisions, but also recognizes that your choices aren’t made in a vacuum. Unless you are willing to address the many factors that shape the way you think about money, you will neither spend, nor save, in a way that makes sense. By offering a road map to financial self analysis, Farnoosh Torabi offers real hope, and real help, to those who want to start using their money effectively.

What are your thoughts on the link between attitudes and actions when it comes to money? Have you tried “psyching yourself rich?” Share your reviews of Farnoosh Torabi’s personal finance book in the comments below.

We recently had the opportunity to ask Farnoosh some questions about her book and her insights into personal finance. Check out the video below.

Lainie Petersen
Lainie Petersen holds master's degrees in Library and Information Science, Theological Studies, and Divinity, and spent five years working in regulatory compliance for a major education publisher. A lifetime Chicagoian, she recently spent almost a year living in the woods of Southern Oregon before deciding to head back home to her family and friends.

Comments Disclosure: The below responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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