I spend a good chunk of my time talking to people about the reasons they get stuck when it comes to getting a grasp on their money. Credit card debt is a common one. So is income. But one of the biggies — one of the roadblocks I hear about again and again — is a fear of the numbers.
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Many of us are simply afraid of math. We're afraid we can't handle the important things, like balancing a checkbook, paying the bills or doing taxes. In fact, it's estimated that math anxiety affects about half of Americans at least to some degree. The phobia is so real, it has its own diagnosis code from the American Psychological Association: 315.1.
Research has shown that it really only takes one bad experience to create a lifetime of math anxiety. Maybe in fifth grade, an insensitive teacher forced you to the board to calculate a problem you didn't understand in front of the whole class. Maybe you screwed up your checkbook so badly in college that you ended up paying out a ton in overdraft fees. Whatever it was that sparked it, this is a fear you have to get over, because people who don't do math also tend not to do money, and that can be completely devastating to your financial picture.
But it's not going to be as hard as you think. I'm not asking you to become a whiz at calculus. You need a basic knowledge of addition, subtraction, multiplication and division. You need a willingness to face something that scares you. And you need a calculator.
Take a refresher course
It's never too late to go back and brush up on your skills. One way to do it is a beginner-level class with an adult education program that will take you from basic adding to fractions, percentages and long division. You may be bored out of your mind during the first few weeks, but you'll be building confidence that'll be a huge help when the tough problems come up later in the course. And because no one wants to relive that fifth-grade blackboard experience, go in and feel out the teacher before you sign up.
Danica McKellar (that's right, Winnie Cooper from “The Wonder Years” grew up to be a mathematician) recently released a book for middle-school girls called “Math Doesn't Suck” (Hudson Street Press). She says that no matter what your age, the teacher means everything. “Math itself is not that bad if you have the right translator. It's a foreign language like any other language. If you have it translated in a way that makes you feel more comfortable, your mind is going to be open to understanding it.”
Start a money group
“A really neat thing that adults can do to overcome a math phobia is form a club, especially if they can get a member who is savvy and does understand math and finances,” says Dr. Ron Lipsman, author of “You Can Do the Math: Overcome Your Math Phobia and Make Better Financial Decisions” (Praeger Publishers, 2004). If you read this column often, you know he's singing my tune.
A couple of years ago, I started touting this idea of a money group, a bunch of friends who get together to talk about financial matters. At one meeting you might cover the basics of investing, at another you'll talk about sending your kids to college. This support system can be a huge confidence booster, but more than that, you'll be able to feed off of each other's strengths. If your friends don't go for the idea, you can link up with an existing group in your area by visiting Oprah.com/jean and clicking on “money groups.”
When it comes to doing math in the adult world, there are no final exams. Like I said before, I am all for using a calculator once you get the basics down. These days, we all have one handy pretty much 24/7 in the form of a cell phone. I'm also going to give you permission to round, and even estimate when an exact amount isn't important. It's OK to round a tip up to the nearest dollar, or estimate the cost of three pairs of jeans to make sure your checking account will cover it. The key, though, is to overestimate. When it comes to overdrawing your bank account or going over your credit limit, it doesn't matter if you do it by a few cents or a few hundred dollars — the fees are going to come rolling in either way.
Make like a sponge
Even as you begin to understand the basics of math, it can be scary to put it to use in your own checkbook, let alone the stock market. To keep that next step from paralyzing you, start soaking up information. I often set the television to CNBC when I'm doing chores around the house or cooking dinner. While you may not be completely focused, you'll at least absorb some of the information. You can also read the financial pages of your local paper, browse the business and finance section at the bookstore, and check out personal finance magazines. These things will get your brain familiar with words and concepts that you'll need in the future if you want your money to grow.
Set your kids on the right track
You can start by talking to them about math and its role in their future. “Math is a part of your life. It's amazing how many teachers don't have an answer to the question of when you'll ever use it in real life. It creates financial independence and financial power so you can be more in control of your life,” says McKellar. Ask the right questions at your next parent-teacher conference to ensure that your child isn't going to fall into the same trap you did. Then be a positive role model at home by pointing out the ways you use the subject every day.
Jean Chatzky is an editor-at-large at “Money” magazine and serves as AOL’s official Money Coach. She is the personal finance editor for NBC’s “Today” show and is also a columnist for “Life” magazine. She is the author of four books, including “Pay It Down! From Debt to Wealth on $10 a Day” (Portfolio, 2004). To find out more, visit her Web site, www.jeanchatzky.com.
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