Economist Teresa Ghilarducci shares some personal finance advice about debt and consumption. She recommends that you should buy the biggest house in the neighborhood. That way you would feel fantastic since you don’t have the urge to upgrade as the people in the neighborhood aspire to be like you. Ghilarducci recommends that you shouldn’t hang around with people who buy things you can’t afford. Choose who to compete with in consumption smartly. By buying the best house on the block, you don’t feel jealous nor need to spend more money than necessary. Ghilarducci also explains that there are two kinds of interest, one you pay and one that you receive. You want to be on the side that gets interest such as savings account and investment. Don’t go into debts and get a mortgage that you can pay it off quickly. (time.com)
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