Conquer your bad financial habits
To stick to your plan, make your new goals compelling, not vague
Our lives are made up of a series of habits.
From which side of the bed you sleep on, to which pocket you keep your ChapStick in, it’s almost like our life is already predetermined.
We can typically change the habits that don’t deliver pleasure. However, when talking about the financial habits that bring us joy or ease or convenience, well, that’s a different story.
I’m not going to instruct you to skip the morning lattes and expensive work lunches that choke off the funding for your financial priorities, although it wouldn’t kill you to do that. (Anecdotally, I’ve learned about 1 in 10 people who hear that advice actually take it. Everyone already knows that’s the problem, but they struggle to establish proper habits to rectify the situation.)
If you want to replace a bad financial habit that brings you pleasure with a good habit that eventually will bring you pleasure, it’s imperative you take the hypothetical improvement to the extreme. Take the statement, “I need to save more money.” While arguably true, that topic doesn’t exactly lend itself to a rousing inspiration that will help you eliminate the habits that are preventing you from saving money.
The stated goal in that scenario is not specific.
It’s not exciting. It’s lame.
You have to know why you want to save money, and the why has to matter to you.
Let’s say you make your goal being able to retire and travel the world with your spouse or partner. You also need to think about why you want to do this. Is it because you haven’t gotten to spend the quality time you thought would spend with them and this opportunity means a lot to you? Specifying the goal as a second honeymoon or a recommitment ceremony or something else that really matters will be more effective.
Unless the goal excites you, moves you and turns itself into a foregone positive conclusion, you won’t change out bad habits for good habits.
As for retirement goals, you are either on track or you are not. There’s no in- between.
You probably know which camp you’re in. Your current financial habits, if on the wrong path, will bring you tremendous pain and hardship when you reach retirement age. That’s not a maybe, might or possibly. They just will.
To avoid this catastrophe, you must replace the bad habits with some good habits. And your motivation to do so must be powerful and compelling.
For example, lots of people get a new car every three to five years. They don’t realize how this financial habit can prevent them from accomplishing other goals they really care about. Yet if they made a smart, longer-term investment in transportation, they could free up some money to fund the goals that actually excited them.
The time is now. Remove the habits preventing you from living the financial future you want to live, and substitute them with habits that will change your future.
Peter Dunn is an author, speaker and radio host, and he has a free podcast: “Million Dollar Plan.” Email him at AskPete@petetheplanner.com. The views and opinions expressed in this column are the author’s and do not necessarily reflect those of USA TODAY.
You have to know why you want to save money, and the why has to matter to you.