Rewiring Your Brain for Saving: The Psychology of Money Explained

🙃 The CFPB Shutdown: What It Means for You and Your Wallet

A major shake-up is happening in the world of consumer finance: the Consumer Financial Protection Bureau (CFPB) has effectively been shut down. If you’re wondering, “What does this have to do with me?”—the answer is, a lot.

The CFPB was created after the 2008 financial crisis to protect consumers from unfair banking practices, hidden fees, and predatory lending. It has been instrumental in cracking down on shady financial products, forcing banks to be more transparent, and saving consumers billions of dollars in unnecessary fees. But now, its future is uncertain, and that could mean trouble for everyday people like us.

What’s Happening?

The CFPB’s funding has been blocked by the Trump administration, bringing its operations to a halt. This means:

• No new consumer protections will go into effect.

• Ongoing investigations into unfair banking practices (like surprise overdraft fees) are now frozen.

• Banks and lenders may adjust fees or loosen consumer protections without immediate oversight.

Basically, financial institutions now have a lot more room to raise fees and make policy changes without the same level of accountability.

Why Does This Matter?

1. Credit Card Late Fees Could Stay High

The CFPB had planned to cap late fees at $8 for major card issuers. Without enforcement, those fees could remain at the industry average of $32, costing cardholders billions.

2. Overdraft Fees Might Not Be Fixed

The CFPB was working to close a loophole on overdraft fees, saving consumers around $225 per year. But without oversight, banks may continue to charge high fees without offering better options.

3. Less Transparency on Fees

The CFPB required credit card companies to justify their fees—without it, banks might start raising costs with less explanation.

4. Fraud & Scams Could Rise

Without active CFPB enforcement, bad actors may take advantage of looser regulations, making financial scams more common.

What Can You Do?

With consumer protections in limbo, it’s more important than ever to stay informed and take control of your finances. Here’s how:

Monitor Your Statements – Check for unexpected fees or policy changes.
Negotiate Fees – Many banks will waive fees if you just ask!
Look for Fee-Free Options – Credit unions often have lower fees.
Build Good Habits– Practice budgeting, saving, and responsible credit use.
Stay Informed – Follow updates on financial regulations so you’re not caught off guard.

🧠 Rewiring Your Brain for Saving: The Psychology of Money Explained

Ever notice how saving money feels like a chore while spending feels like a celebration? There's a reason for that - and understanding the psychology behind it might just change your relationship with your bank account forever.

The Struggle is Real (And Normal)

Like many of you, I struggled with savings in my early 20s. I wasn't blowing money on wild parties, but I also had no real savings strategy. My money sat in a checking account or a laughable 0.01% interest savings account at a “big bank”. Sound familiar?

I had this vague sense that "I'd figure it out" if something went wrong. My finances were reactive, not proactive. Honestly, saving felt unnecessary—why worry about the future when I was getting by just fine today? It took me a while to see the bigger picture, but I don’t want you to make the same mistake. So, let’s rewire the way you think about saving.

We're Diving into "The Psychology of Money"

Throughout this article, we'll be referencing Morgan Housel's brilliant book "The Psychology of Money" to understand the deeper principles of saving. If you haven't read it yet, I highly recommend it - it's changed how I think about money completely. Let's explore some of Housel's most powerful insights about saving money and see how they can transform our approach.

The Oil Crisis Lesson

In The Psychology of Money, Morgan Housel shares an insightful story about how America faced the oil crisis in the 1970s. Rather than discovering new oil reserves, the country became more efficient with the energy it already had. The solution wasn’t about increasing resources—it was about reducing the amount of energy needed to power the economy. We developed fuel-efficient cars, more efficient factories, and better energy use across the board. The result? America grew its "energy wealth" not by getting more oil, but by using less.

This principle applies to personal finances too. Building wealth isn't always about finding more money—it’s about saving more efficiently and using what you already have wisely. Just like with energy, it’s not about how much you make, but how well you manage and optimize it that really matters.

What Really Matters: Ego vs. Needs

This hits hard because it's true. Once our basic needs are met, additional spending often becomes about ego - showing others we have money rather than actually improving our lives.

Your ability to save is more within your control than you might think. Housel's formula is surprisingly simple:

• Spend less by desiring less

• Desire less by caring less about what others think

• Save more by making it automatic

The Psychology of Automated Savings

Studies show that our brains perceive automated savings differently than manual transfers.

When money automatically moves to savings before you see it in your checking account, you experience less "loss aversion" - that painful feeling of giving something up.

According to 2023 data from Vanguard, participants in automatic savings plans saved an average of 7.4% of their income, compared to just 2.8% for those making manual decisions.

Saving Without Sacrifice

The best savings approaches don't feel like punishment:

1. The 30-Day List: When tempted by non-essentials, add them to a 30-day list. If you still want them after 30 days, reconsider.

2. Save Your Raises: Automatically direct 50% of any raise or bonus to savings before lifestyle inflation sets in.

3. Subscription Audit: Review subscriptions quarterly. The average young adult spends $273 annually on forgotten or unused subscriptions.

You Don’t Need A Reason To Save

As Housel emphasizes in his book, you don't need a specific reason to save. Save for saving's sake. Why? Because money equals options, and options equal freedom.

The most valuable thing money gives you isn't stuff - it's choices. The ability to change jobs, leave toxic situations, take opportunities, or simply sleep peacefully knowing you can handle what comes your way.

Start With an Emergency Fund

An emergency fund isn't just financial protection - it's peace of mind. According to a 2023 Consumer Financial Protection Bureau study, people with emergency savings reported 30% lower financial anxiety scores regardless of income level.

Start with whatever you can - even $25 per paycheck. The goal is building the habit first, then increasing the amount as you can. Aim for $1,000 initially, then work toward 3-6 months of essential expenses.

The key is where you keep these funds- (hello, high-yield savings!)

Make your savings work harder by keeping it in a high-yield savings account. High-yield savings accounts offer significantly better interest rates than traditional savings accounts, helping your money grow faster over time. Plus, they keep your funds liquid and easily accessible, so you can withdraw cash quickly when unexpected expenses arise.

Final Thoughts

The psychology of money teaches us that comparison is the thief of financial joy. Your saving journey is uniquely yours. Whether you're starting with $5 a week or $500, the habit matters more than the amount.

Remember: Your future self is a real person who will either thank you or curse you based on the decisions you make today. Which future would you prefer to create?

🎁 A Little Gift from Us- Free 1:1 Money Sessions!

We get it—navigating money stuff can be tricky, especially if you're starting from scratch. Whether it’s understanding credit, picking the right bank account, or just figuring out how to save, we’ve all been there. As international students ourselves, we had to figure it out the hard way, and we want to make it easier for you.

That’s why we’re offering a FREE 30-minute money session with the Wicked Pay team! No sales pitches, no gimmicks—just a chance to ask questions, chat about your finances, and get advice from a team that’s been through it all. Whether you're looking to build credit, get smarter with your spending, or just vent about money stress, we're here for it.

This is our way of giving back to our community—helping you take control of your finances without the overwhelm.

If you’re ready to take control of your finances, let’s talk!

📩 Reply to this email or comment on our latest post to get more info.

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