A practical way to think about money today

Author and CNN veteran money correspondent Christine Romans believes we should live by three qualifiers: living within our means, living with less debt, and being less vulnerable. While some may say this is old-fashioned, today it's hard to argue with Romans' view.

Smart is the New Rich explores how adopting a new approach to money can lead to a healthier financial lifestyle. Each chapter opens with a question about money to begin the conversation about earning, saving, spending, growing, and protecting your money. Using checklists and quizzes, Romans guides you through the "New Normal," helping you to think differently about your money and relearning good habits for prosperity.

• Reexamines the money rules abandoned during the consumer bubble and poses the essential questions we should ask ourselves before spend our money
• Provides an interactive, step-by-step guide to all things money, from credit, debt, and savings to investing, taxes, and mortgages
• A companion Web site allows you to chat with other readers about jobs, mortgage rates, investing, and saving

For thirty years, the financial rules for life revolved around abundant credit. That bubble has burst. Smart is the New Rich addresses why these rules no longer apply, and reveals what it will take to make the right money choices moving forward.

Five Retro Spending Rules

After a generation where “me, more, now” was how we thought about our money, it’s time to walk through these five retro rules when you are about to part with your money.

1. If you don’t need it, don’t buy it. If you can’t afford it, put it down.

It’s as simple as that. Ask the three key questions before parting with your cash. “Do I need this?” “Will it make my family better, smarter, more prepared?” “Can I even afford it?” Only you know the answers to those questions. And just asking them gives you pause to evaluate whether the dollar buys you an experience and an investment in your family and your future.

2. Think of money like nutrition.

Is a purchase, whatever it is, something that is good for your body, or nothing more than a sugar rush. Prolific and random spending is the money equivalent of eating junk food. It might feel good at the time, but it hurts you in the long run and the limits your options later in life.

3. Negotiate everything.

It seems gauche to call it haggling, so let’s call it negotiating. Your cell phone company, cable provider, car rental company, and even your doctor need your business. Politely ask if there are discounts. For travel and leisure, inquire about a complimentary upgrade if they won’t drop the price. (Vacations have never been more attainable--if you can afford them--this is a good time for breaks and discounts.) If you are polite and informed, you will be surprised.

4. Always save first.

Do you know how much you are saving? Look at your pay stub. Calculate how much money you bring home after taxes. Make sure you are saving at least 6 percent and hopefully 10 percent of that for your future. Save first.

5. Don’t deny yourself.

As confidence in the economy returns, the people who have the cushion to spend money will be critical to restore the economy. Every dollar spent at the pizza parlor, on video games, at the zoo sustains jobs. The key is to know what you can live without. The message for anyone struggling with money: The only thing you can control right this second is how the money leaves your hands.