02/09/2012 08:22 am ET | Updated Apr 09, 2012

Financial Saving Tips: Simple Ways To Stop Doing Dumb Things With Money

Many believe that to make good money decisions you need to have a plan for every situation. You need insurance for every possible setback, and investments for every market condition. All of your assumptions about the future need to be refined to perfection, so you will never be surprised. You need to know and understand everything about the financial markets, and you need to budget your spending to the last dime.

That kind of thinking is based on fear, and it's an issue I tackle in my new book, The Behavior Gap.

Not surprisingly, we fear life's uncertainty, its ups and downs. And so we make plans that we hope will give us the power to control our future. If I do this, that will not happen; if I sell now, I will avoid the coming downturn; if I pick the right investment, I will be financially safe; if I worry enough, I will be ready when bad news comes.

Trouble is, the real world is complicated; we don't know what's going to happen. So if planning isn't the solution to our money problems, what is?

The answers are simple if not easy. You need to focus on the things you can control, which can be incredibly difficult because we hate uncertainty. In this slideshow, I'll walk through some helpful tips that I've seen work over the years to get you past your fear and to help you focus on the money decisions that matter.

You'll find that a big part of that requires letting go of some fantasy that you'll make "perfect" decisions every time. There's also the reality that you can't protect yourself from everything (you don't live in a bubble). Finally, you'll need to give serious thought to understanding (and being honest) about what you really want. Too often this is the last question that gets answered, but the answers play a central role in our relationship with money.

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