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The Honolulu Advertiser
Posted on: Monday, December 28, 2009

Father, son team tackles people's money disorders


BY Greg Wiles
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Brad Klontz, right, and his dad, Ted Klontz, leaders in the emerging financial psychology field, wrote "Mind Over Money."

Photo courtesy Brad Klontz

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Hawaii news photo - The Honolulu Advertiser
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Kaua'i psychologist Brad Klontz has a full schedule these days, thanks in part to Wall Street's meltdown last year and the angst that followed.

Over the next several weeks he's scheduled to have his newest book reviewed by USA Today and be interviewed by a host of publications, ranging from Parade to Family Circle.

There's a reality television show offer to contemplate, the blog he writes for Psychology Today and his gig as a spokesman for H&R Block's Dollars and Sense Program.

"I'm on a plane a lot," said Klontz, a Líhu'e resident who has become well-known in the emerging field of financial psychology. As such, he helps people understand deep-seated reasons for money disorders and how to overcome them. "I probably would have lived in obscurity if it wasn't for the economic collapse," Klontz said.

That's a bit of an overstatement, since Klontz and his father, Ted, have worked for years counseling people with financial issues and have authored three books on the subject in the process.

But last year's cratering of financial markets, along with turbulence in the economy and rise in foreclosures, have resulted in a media whirlwind for Klontz.

He had just published a study on the treatment of money disorders in Psychological Services, a journal published by the American Psychological Association, before markets tanked in 2008.

That netted him prominent mention in a New York Times feature story. The article appeared 10 days after the historic collapse of Lehman Brothers and plunge of markets as people tried to sort out what was happening with their investments and savings.

"That really led to a whole storm of things happening for me," said Klontz, who was approached by Random House with a book project shortly afterward.

The result is "Mind Over Money: Overcoming The Money Disorders That Threaten Our Financial Health," a 320-page work that explores how people's experiences shape their attitudes and approaches to money management. The $25 hardcover will go on sale on Tuesday and will be accompanied by a book tour that starts in New York.

As in past books, Klontz and his father argue that managing money is pretty simple — don't spend more than you make, and you have to save for the future.

But many people have a difficult time sticking to those dictums.

"We already know what we should be doing, and why aren't we doing it?," said Klontz, who has championed psychologists exploring the financial stresses and money relationships their clients face. In doing so he was given an Innovative Practice Award by the American Psychological Association.

Klontz and his father previously authored works exploring this subject that included a Christmas allegory about Ebenezer Scrooge and money, another about unleashing wealth potential and a book for financial planners, coaches and therapists on facilitating financial health.

The current work differs from prior books in that it digs into the origins of money disorders, Klontz said.

"In this one we really dove into our histories — how our past historical experiences around money really predict our current financial situation," he said.

The book includes examples of people's money behaviors. The root of one man's inability to build savings, negotiate salary increases or manage investments is traced to an early incident in which he saw destructive behaviors in the pursuit of money.

In that case, the man had developed beliefs that working hard and family time were more important than money.

After exploring the past and present issues, Klontz's client was able to achieve a middle ground when it came to having and managing money.

Not everyone agrees with Klontz's work.

A customer review of the Klontz's "The Financial Wisdom of Ebenezer Scrooge" takes them to task for purveying pop psychology. It said the book is a thinly disguised sales pitch for consulting services that feature the Klontzes and South Dakota financial consultant Rick Kahler.

"And it's an insult to Charles Dickens," said the review posted online. "We were probably meant to take away some lessons about money from the original tale, so 'A Christmas Carol' is worth another read. This book however is rubbish."

But the majority of readers gave more glowing reviews of the book.

Klontz said he doesn't own a financial interest in the Kahler consulting services and only gets paid a salary for the six-day seminars it has periodically. One such session was the subject of an ABC "20/20" segment last summer.

As for pop psychology?

"I hope it becomes pop psychology," Klontz said. "I mean, 'pop' means popular."

He said that's part of his overall agenda, which includes bringing more psychological focus into the role of money. He also wants to give financial planners more insight into why some clients don't follow financial road maps that are drawn up for them.

The books also allow him to reach people in an affordable way so they can understand on their own what money disorders they may be facing.

Klontz also works with the state Department of Education on educating high school students on financial issues.

"We're definitely not selling a get-rich-quick scheme," said Klontz, noting that some people looking for a panacea to current financial problems won't find it in the book. But he said it could be helpful as they navigate their way back from money problems.

"You can go one of two ways on that. You can blame the entire system or everyone else and likely continue making the same mistakes.

"Or, two, you can say, 'OK, what role did I play in this.' "