Allstate Blog: What’s an example of that? Richards: The classic one is that we buy high and sell low. In 2006, did you become a real estate investor, like so many of us did? In ’08 did you swear off equities forever? And, now, are you feeling, like ‘Hey maybe I should be buying back in the stock market?’ We sell when everyone else is scared and buy when everyone feels great. And we just keep doing that. AB: What’s a good way to resolve that? R: We have to realize money is emotional. Let’s stop expecting it to be like a math problem, like it should be 2 + 2 = 4. It’s not. [Money] represents our biggest goals and dreams. We also don’t talk about money enough. How many late-night arguments have you gotten in over the credit card statement? Instead of [arguing about the money spent], let’s talk about why you spent this money. AB: So, where should a money talk begin? R: Start with your current [financial] reality. Get really clear about [it]. I used to think that was easy, but the more I talk to people the more I realize people don’t know where they stand. So, build a personal balance sheet. And if you don’t know what that is, do not be embarrassed—nobody else does either. Use Google. AB: What next? R: Start to put a framework around where you want to go. But don’t get too tied up in that. People get so nervous, like, ‘Where am I going to be 30 years from now? I have no idea!’ That’s fine. Where do you think you “might” want to be? The process of getting clear about where you are today, and having those discussions of where you want to go, will lead you. AB: One of the really interesting things you talk about in your book is the idea of personal responsibility. You’re a rare voice in that. R: We all make [financial] mistakes, but we have a choice. We can sit around and blame Wall Street, the big bad banks, credit card companies, a family member, business partner, spouse … but as long as we stay in that game—of just finding someone else to blame—nothing will change. AB: Why do you think people respond that way? R: We’re making very important decisions under an extreme degree of uncertainty, and it leads to a feeling of lack of control. I don’t know if there’s anything scarier to humans than lack of control. Instead, it really helps to focus only on the things you can control. AB: Like what? R: Like, how the amount of money you save will have a far more dramatic impact on your financial future than the rate of return you earn. We spend so much time searching for the best investment, or trying to get the highest return, instead of figuring out how to save a little bit more (or maybe how to make a little more; there are two sides to that). So, focus on what you can control—how much to save, what your expenses are, what the tax consequences of your decisions are, etc. AB: And then? R: And then realize that, when it comes to investing, this really is a long-term game. Everyone says ‘invest in a diversified index fund, it’s a long-term investment,’ but the average hold time is less than two years. You would never plant an oak tree and dig it up every week to check its roots. Long term means long term.