Financial Habits

Written by: Jennifer Hare, CPA

Happy New Year!

I hope the first few weeks of 2023 have treated you and your families well. As we start to settle into this new year, how are your resolutions going? Do you have big plans to make changes to your spending habits? Maybe you want to be more organized in your small business? Maybe you simply want to have a better idea of where your money is being spent. So often we have amazing intentions to make positive changes in our lives that just do not seem to stick. We often get down on ourselves and wonder why we keep failing. May I offer the suggestion that you are not failing but rather you just don’t have the right thoughts to make your habits stick yet? Keep reading to see if you can apply one or all of the following suggestions to help turn your success around.

• Find your why

For just a moment I want you to pause, close your eyes, and think about why this money change habit is important to you……? Got your why? Maybe you need a few more moments to sit and think about it. Please take this time as the why can be so powerful. Often times when we connect with the deep reason for doing something, the act of doing it often becomes easier. Finding the deep reason you want to accomplish something is so very powerful and can be very motivating. If your why is powerful enough it may be the sole reason that you stick with your new habit. Once you figure out your why behind your financial habit change, do not let yourself forget it. I suggest setting yourself reminders and putting your why everywhere. You can set alarms when you might find yourself in a position to break your habit. You can also put little notes in places to keep your habit strong. A well-placed note in your wallet can help you think twice about pulling out your credit card.

• Tap into the power of your future self 

I know this may sound a little abstract and outside of your comfort zone. Stick with me for a few more sentences to see if this tip might resonate with you. We just explored your why and how exploring and identifying your why can make the habit stick. Another way we can get a habit to stick is to explore who we will become when we achieve our goal. What that future version of ourselves thinks about, how they act and what choices they would make. So again, sit for a moment, close your eyes and think about who you are after you have reached your financial goal. If your goal is to pay off credit card debt, does the future version of you still carry around your credit card in your wallet? Maybe your debt free self thinks a little longer about putting a purchase on your credit card. What if your goal is to create an emergency fund? Does your future self who has a fully stocked emergency fund still feel stressed about potential financial emergencies? Maybe this version of you feels proud of your accomplishment. Did you know that you can be your future version now? You may not have conquered your goal yet but you can start acting like the version of you that has achieved the goal now. Thinking, acting and feeling like that future version of you can be your secret weapon to sticking to your goals.  

• Make it automatic

The less opportunity you have to ignore or stop following through on your habit, the less likely it is that you will stop the habit. For example, if your goals are to pay off a lingering debt, you can set up an automatic payment on each pay day. Maybe your goal is to save up an emergency fund. To help you achieve these goals you can set up an automatic deduction from your pay that goes into a separate bank account. These types of automatic payments ensure that even when life gets busy and you forget to take action, your goals are still being worked on.

• Get Creative

Financial habits for so many people are not viewed as fun things to work on. They are often regarded as a necessary evil. I am here to let you in on a little secret. Finances can be fun or at a bare minimum at least bearable. If you have a financial goal of spending less money, you can make it a game. One of my new fun habits is to see how much money I can save when at the grocery store. I make a grocery list of all the items I need to restock the food at my house and then I start my game. I spend time looking for sale items and making my price matching list. I also look for point opportunities when I shop at stores that have store point rewards. Surprisingly it is not only fun to see how much I can save at each grocery shop, but it is also rewarding when I can save extra money at the same time.

• Find an accountability person

We all know how easy it is to let ourselves off the hook. We give ourselves great reasons why the habit is no longer necessary…reminder to always check in with the why when you find yourself talking your way out of sticking with a new habit. To help you get past this stage, I suggest finding someone you trust to help you stay accountable. Share your financial dreams with this person. Let yourself be vulnerable and share why these dreams are so important to you and what plans you have come up with to achieve these goals. Then each time you feel yourself not wanting to work towards your goal or providing yourself with a way out, reach out to your person. Another idea is to have a regular check-in to share your accomplishments with him/her.

Finally, build in a celebration plan. It can make all the difference when you know you get to celebrate with someone when you achieve your goals.

Financial habits can be hard to start and follow through on. By using some or all of the suggestions above you can build strong habits and reach your goals. There is nothing quite as sweet as the feeling of true joy that comes from achieving them. I believe in you and your ability to achieve your financial goals. Now go and make you financial dreams a reality!

Jennifer Hare, CPA
Jennifer is a Financial Coach who has a big passion for helping people feel more safe and secure in their financial situation. Contact her at [email protected]