Food and personal finance are similar (part 2) Maypurge

Ramit Sethi

Earlier this month, I wrote how food and personal finance are similar. Now check out a few excerpts from yesterday’s New York Times Magazine article on nutrition, which also has lots of parallels to money:

Humans deciding what to eat without expert help — something they have been doing with notable success since coming down out of the trees — is seriously unprofitable if you’re a food company, distinctly risky if you’re a nutritionist and just plain boring if you’re a newspaper editor or journalist. (Or, for that matter, an eater. Who wants to hear, yet again, “Eat more fruits and vegetables”?) And so, like a large gray fog, a great Conspiracy of Confusion has gathered around the simplest questions of nutrition — much to the advantage of everybody involved. Except perhaps the ostensible beneficiary of all this nutritional expertise and advice: us, and our health and happiness as eaters.

The whole “expert” industry of pundits and personal-finance magazines sells products, not wisdom. See Dumb: Don’t Invest; You Can’t Beat the Pros.

Naïvely putting two and two together, the committee drafted a straightforward set of dietary guidelines calling on Americans to cut down on red meat and dairy products. Within weeks a firestorm, emanating from the red-meat and dairy industries, engulfed the committee, and Senator McGovern (who had a great many cattle ranchers among his South Dakota constituents) was forced to beat a retreat. The committee’s recommendations were hastily rewritten. Plain talk about food — the committee had advised Americans to actually “reduce consumption of meat” — was replaced by artful compromise: “Choose meats, poultry and fish that will reduce saturated-fat intake.”

(Reminded me of How mutual funds make tons of money for themselves, not you)

A subtle change in emphasis, you might say, but a world of difference just the same. First, the stark message to “eat less” of a particular food has been deep-sixed; don’t look for it ever again in any official U.S. dietary pronouncement…“Eat less” is the most unwelcome advice of all, but in fact the scientific case for eating a lot less than we currently do is compelling.

Sort of how like you rarely hear financial “experts” recommending the most time-proven strategies of all: Live beneath your means, save aggressively, invest early, and continue learning about money. It’s just not sexy, is it?

The full New York Times article: Unhappy Meals.

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  1. dimes

    So in both the realm of dieting and in saving money the advice simply boils down to “consume less”? And don’t be so quick to jump on the bandwagon of the overly complicated product?
    Geez, Ramit, if it’s really so easy then why are so many people obese and/or mired in debt? Because it’s easier to be undisciplined? Or something else entirely?

  2. Katie

    I watched the end of a disgustingly fascinating show last night, about people who consume 33,000+ calories per day. They were so obese that they could no longer walk, and they were so addicted to food that they prefered to binge over any other activity, including sex (clearly), and would manipulate their loved ones into feeding the addiction (since they couldn’t go out and buy their food themselves…)

    Anyway, point is, I think these extreme cases illustrate the complex relationship that people have to food and money. Those are two issues that are tightly related to self-care and self-esteem–giving yourself a food “treat” is filling an emotional need to feel loved and cared for. Food and money aren’t exactly the same of course–I think the difference between say, loving expensive shoes and loving to binge, is that shoes probably won’t kill you.

    In any case, I don’t think it’s as simple as telling someone to eat less or spend less. I think the 800 lb man knows he should eat less…so why can’t he do it?

    Ramit, you have touched on this when you suggest making moderate changes that you can stick with as opposed to drastic changes that you’ll soon give up, but I still don’t think that quite hits at the heart of the reasons people overeat or over spend. If the way that I feed my emotional needs is by buying expensive shoes, then trying not to buy them will depress me and make me feel uncared for and unloved–and probably lead to a shopping spree down the line, just as starvation and deprivation lead a dieter to binge. Breaking that emotional connection is the nearly impossible task. Maybe you should ask Dr. Phil to write a column.

  3. Cris

    Ironically enough, after losing over 70lbs recently, I came to the same conclusion as Ramit, but from the opposite angle – the strategies you use to grow your bank account should also be applied to grow your “body account.”

    For me, it all comes down to emotional eating and emotional purchasing – people don’t seem to make choices any more, they react to emotional impulses when deciding what to eat or what to buy. By using money-saving strategies and thinking of your body as a bank account, you strip the emotional hooks, like depression and frustration, and take a more objective view of weight loss.

    I have been writing an article about this for my own blog at and, ironically enough, finally finished it this morning. I personally agree that spending habits and eating habits are related. As I talk about on my blog, I have begun applying lessons I learned during my weight loss to control my spending habits, and have started applying personal finance lessons I have started reading about here and at The Simple Dollar to help maintain my new eating habits. I firmly believe that not only are personal finance and eating habits connected, but by practicing strategies to manage one, you will likely improve the other.

  4. Adrian - Queens, NY

    You know Ramit, speaking of mutual funds, I go into my to the local Washington Mutual looking to open up an IRA. I don’t know much about particular mutual funds…so he starts throwing out all these mutual funds that have high returns over the last decade or so, morningstar 5 star ratings….that’s when I say….well I really want to do an index funds….he then says “are you kidding?”…I’ve been doing this for 17 years and where are we?”….I answer “NY”….he says “No, Midtown Manhattan!” in a jokingly way….I say “Well I think I’m looking for a long term approach”….he says “What are you 70? I think you’re making a big mistake”….I then get a little nervous because he’s giving me more mumbo jumbo that I don’t really pay much attention to and then I say “Well, what do you offer and what’s the mgmt ratio”…He says “You know what I like about you?”….I nod in a way as if I don’t know what he’s going to say….”You’re a young person asking good questions…guess what the mer is only 1.29 and guess what the returns always factor it in because it’s a govt rule.”…I say “Ohh” acting impressed but I’m reallly not….he then says “You see, so it’s beating the s&p avg by 2% over the last 30 years!…Tremendous, right?!”….I say “yes”…he then says….”Well, you have to have exposure”..blah blah blah….and I say “Ok give the paperwork because I don’t want to make a rash decision”….he then goes on to tell me how many clients he has and then tells me “You know, so many people come to me during the year and they don’t like their portfolio, so they ask me to change and sometimes guess what — they’re right!….I do change it, but if you don’t ask it…then how will I know….You have to take care of your stuff”…so thats when I interject with “That’s why I like the idea of the index funds….and plus the low mer….”…and he disappointingly says “Well, I gotta run, get back to me with what you want me to do”….I take a deep sigh and walk out of the bank trying to stay unfazed.

    Good for you for asking the right questions. That’s awesome.


  5. Julie

    I agree with Cris (and Cris, I must come see your article!).

    Ramit and Cris, I’m a big believer that “sense of urgency” can be destructive with both healthy eating and healthy finance. Both require a senseible plan, with a balance.

    Cris, I also experienced that by learning mindfulness (that is to say, deciding to have a plan andmake good choices to stick to it) I have improved both my physical and financial health.

    I imagined a lot of young, recent college-graduates might not understand this as much as I (hitting middle-age sooner rather than later sort) do, so Ramit, it’s a pleasure to see you writing on this.

    To Dimes, I say, the point doesn’t IMO boil down in both cases to consume less. It boils down to “know how much you can healthily consume based on your specific situation…formulate a plan to stick withiin that…and then make good choices that support that plan.”

    In both dieting and investing, I was surprised to learn I ought to consume a little more for my maximum benefit.

  6. Nagel


    Don’t trust brokers. They are out for their best interest, not yours.

    Mutual funds get fat off investors is true.

  7. Abhijit Mhapsekar

    Hi Ramit,

    In India, high risk mutual funds are giving a return of about 50% annually, the highest being 66%, while medium risk funds are give a return of more than 35%. The profits made are tax free.

    This has been the case since the last 2 years and the markets have been doing quite well here.

    I’m thinking of investing 6,000 USD in high risk funds and from then on a major part of my monthly salary for the next 18 months, so that i can fund my own business by then.

    Since you are not in favour of investing in mutual funds, i’m eager what you’d advice me to do.

  8. j

    Regarding poster #1: It’s not that being rich OR healthy is as “easy” as the basic advice (i.e. eating well, living under your means and using common sense). The point is that those things are HARD to do. Donuts are tempting and cheap while Plasma HDTVs are temptive and pricy. The tough thing to do is to act with restraint.

    Where people fall into bad habits with money or food, I feel like the reason they take bizarre ways out like the zero carb only fruit juice diet or investing everything they have in some currency trading program they discovered on an infomercial is because they felt that THOSE things would be easy.

    Chasing “sexy” ideas is definitely a bad choice, and often those are the same as the “easy” ideas.

  9. Blair Christopher

    It is safe to say that your last paragraph pretty much sums up your philosophy and what you are trying to instill in us (your loyal readers) throughout your blog!

  10. BrianM

    j @ #7 has it right, I believe. When I first started to lose weight, I would have friends and co-workers come up to me and ask “What’s your secret?”

    I would smile and say, “Two things – first, I eat less, and second, I exercise more.”

    “That’s not what I meant!” they’d say. “I know that already! I wanted to know YOUR SECRET.” They wanted to know the way to eat all the things they want and STILL lose weight.

    I think it’s the same with money. It’s easy to KNOW that you have to spend less than you take in. People just resist doing it because they want the OTHER easy thing, too.

  11. J

    The definition wars are on.

    The analogy between food and Pf only hold when you equate good nutrition with being skinny. This is easy for a policy analyst and difficult for a true nutritionist.

    In this analogy:

    exercise=work at the highest paying job possible

    eat less=spend less

    don’t go on a nifty diet=don’t trust experts, they’re trying to sell you snake oil

    . . . but, if you’re already skinny and already exercise in the metaphorical and in the literal sense, it doesn’t necessarily mean that you are healthy and well nourished. Approximately 1/3 of Americans are not (yet) over weight, but only 10% are adequately (not optimally, but adequately) nourished and less than half a percent of Americans are thought to be in optimal health.

  12. david

    I think that the link here between personal finance and health boils down to a few key points. It has more to do with personality than just following a set of instructions.

    First, balance is required. If you’re the type of person that wants to enjoy life (and who isn’t?) then you likely want to enjoy going out to eat, stopping off at Krispy Kreme for a donut and coffee now and then, having a beer with friends, a nice place to live and a decent car to get around in. You want to take nice vacations, etc.

    But, if you go to extremes with those things you’re not going to enjoy life. You’re going to eat out too much, eat the wrong things too often, drink too much alcohol, take on more debt than you can handle, etc.

    It’s a matter of finding the balance in both your health (diet, exercise) and your finance (what you spend, where you spend it and what each purchase ultimately costs you).

    The other key is having drive and discipline. Our cultural has a created this idea that you should get what you want now and you should be able to get it easily. (Credit cards, drive thru’s at fast food restaurants, etc.) People that don’t have the drive and discipline to make themselves eat the right things and exercise likely won’t have the drive and discipline to make themselves get sufficient education and build a career that provides them with the means to live comfortably without overextending themselves.

    The issue involves an individual’s personality as well as how they’ve allowed themselves to be shaped by advertising and mass media…

  13. ryan

    Can you blame anyone for overeating given the portion sizes you get when you eat out these days? I’m not overweight, but I realized that I didn’t enjoy the food coma I’d have after every meal. I’ve stopped eating before I feel full, and surprise! – no more food coma.

    Most of our lives we’ve had adults telling us to eat more. We don’t need nearly as much food as we think we do.