Mental accounting attempts to describe the process whereby people code, categorize and evaluate economic outcomes… in other words, we often tend to place a different value on our money, depending on where it comes from - think salary vs bonus - they way we treat different categories of money is different.

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• [5:32] - What is Mental Accounting
• [8:00] - Concept of Fungibility
• [12:42] - Who is more likely to avoid Mental Accounting traps
• [17:00] - Tips on how to avoid Mental Accounting

After the Show-Show

• [28:15] - The After the Show-Show begins

How to avoid mental accounting:

1. Know what you have
   • Create a purpose for inflows and outflows
2. Stop keeping everything in your mind and write it down
   • Get a budget
   • Translate your goals from your brain to a binder
3. Get an accountability buddy to help you
   • Talk about it
4. Label your accounts! Actually label them
   • Emergency, travel, baby, soccer, retirement