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Budget Expert Offers New Year’s Resolution Advice

Contact: Sarah Morehead, (207) 951-4551

ORONO — If saving more money in 2011 is on your list of New Year’s resolutions, University of Maine home finance expert Sarah Morehead has advice that might help.

It’s all about mindset, says Morehead, a research assistant who oversees the UMaine School of Economics’ Household Financial Education Program and the Knowledge Transfer Alliance, a program providing business management and marketing consultation for small businesses throughout Maine.

“Mostly, wasting money comes from emotional spending, or ignorance,” says Morehead, whose research interests include the psychology of economics and basic budgeting, “but where we really end up spending money is when we spend it on our emotional needs.”

The realization of how and when unnecessary spending takes place can be a first step in changing behavior, she says. Morehead says, for example, that she has been surprised when reviewing the amount of money she has spent over the course of a year on fast food.

Morehead suggests taking a positive approach to prioritizing finances. Success and better budget control can result from thinking positively about accumulating savings, as opposed to dwelling on what we’re going without.

“Instead of a $4 latte, maybe you can get the same gratifying effect with something less expensive, something that gives you that same bang for less money,” she adds. “It shouldn’t be an either-or situation.”

Then, deposit any daily savings into a savings account.

In addition, she recommends considering frame of mind when we spend more than we should or even want to. Do we tend to spend frivolously when we’re feeling down?

Morehead, who conducts workshops and seminars in Maine schools on budgeting and household financial education, says it is important to understand the root cause for failing to keep on top of budget priorities.

She discusses this topic in more detail on her Facebook blog at http://financetherapy.wordpress.com and can be reached for other advice and tips on better budgeting at sarah.morehead@umit.maine.edu or by calling (207) 951-4551.

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