Goodbye willpower, hello habit
What do you do regularly that helps or hinders your finances?
Perhaps you buy lunch every day, a takeaway every weekend, or treat yourself when you’re fed up? Let’s be more positive. Perhaps you check your bank account every day, track what you spend, automatically move money into savings or pay off a chunk of debt each month?
It takes effort to consciously think about what we’re doing every minute of the day, so our poor brains help us out by automating actions we repeat, forming habits that we sometimes barely register, so that it can concentrate on the most pressing issues.
A stepping stone to bigger things
One of my goals for this year, # 7 if you’re interested, is to develop better financial habits. It’s not a goal that paints much of a picture, but hopefully it’ll help me to reach my more meaningful goals.
What are the new financial habits I want for 2019?
There are two.
- I want to track my spending on a daily basis, and
- I want to spend 30 minutes every week on my finances.
That’s it! It’s not revolutionary, it doesn’t sound like much, but that’s the point. I want something small and achievable, not a goal that will stretch me too much. I should be able to file a few papers, or tackle a job like renewing an insurance, or whatever, for half an hour a week.
Why is this a big deal?
Because this is not what I currently do! Despite having a crystal clear motivation for improving my finances – early retirement – and despite having, at times, the willpower and focus to do what it takes, I find myself regularly ignoring my finances.
I’ve used a spending tracker app for a few years, it’s useful, but I let it slip, and regularly miss common types of spending – online spending is a common culprit. And I definitely don’t sit down every week to keep on top of my finances. Papers don’t file themselves, admin needs doing. I need to break the pattern of spending hours getting on top of my finances, only to then throw away all the good work by ignoring my finances completely for weeks or months at a time.
Why did I pick these habits?
- They don’t take much time, and should therefore be doable. Daily entries to my spending app take a minute. A weekly 30 minutes is more of a commitment, but in theory it’s not too daunting.
- Short weekly sit-downs should mean it’s easier to face the task, if I know the pain will soon be over.
- Short weekly sit-downs force those of us with a tendency to keep going once they start (i.e. me), to stop. Hopefully before I’m sick of it and it’s ruined my morning or day.
- Regular reviews should mean I stay on top of things. I can cross just the most urgent job off my to-do list, and know that there’s no worry in leaving the other tasks until next week.
- If I’ve spent too much, I can nip it in the bud, and make savings elsewhere. I’m much more likely to stay within budget.
- To stop a mountain of receipts and paperwork building up. It’s much easier to file a bank statement or bill than a pile of paperwork going back 2 months.
- A regular routine means there’s probably not much outstanding, so if I miss a week it’s not the end of the world. (My favourite reason! – though see ‘Stick to it like glue’ below…)
How’s it going so far?
January brought with it my usual New Year’s resolve to sort out the mess that had inevitably built up. I shredded unnecessary papers, I filed, I worked out what I’d been spending. I was motivated, and got a lot done.
February came and went, and with it my motivation. The daily spending tracker is not a problem. I’ve missed a few days but it’s been easy enough to remember what I’ve spent. However, the weekly half-hour is proving a struggle. I’m 2.5 months in, and I’ve missed a couple of weeks. Nothing too serious, but I’ve struggled nonetheless.
Where are you, willpower?
My willpower waxed and waned and disappeared. From my New Year’s high, I’ve had to force myself to do the weekly review, and have also missed it completely. It’s clear I can’t rely on my willpower to get the job done, and I’m not in new habit territory yet.
In the marketing blurb for my new ‘Habit Tracking Journal’ (this is the one I’ve bought, it’s helped me to tick off with pen and paper whether I did what I intended), they say it takes 21 days to build or break a habit. Clearly, 21 days is not enough for my weekly routine to have become habit. Other estimates are that it takes 3 months to form a new habit. Or it can be longer, dependent on the individual and circumstances. Whatever. The point is it takes some time, and potentially quite a long time, for something new to become the norm. If you need to do something 21 times for it to start to become habit, then I’m looking at having to persist for 5 months, until the end of May, until it starts to become second nature. This seems plausible enough for me.
Something to know about habits
Apparently, there’s something called a ‘habit loop’ which consists of the following 3 steps:
- an external cue – e.g. time of day, seeing something, smelling something
- a routine – e.g. arriving at work, then having a coffee
- a reward – e.g. perking up a bit
I think this is one reason I’m finding it easier to stick to my daily spending tracker. I tend to update it before bed, so it’s part of my regular night-time routine. I aim to do my weekly review on a Sunday, but I haven’t specified at what time as I don’t have a regular routine on a Sunday. So it gets done when I feel like it (which I usually don’t…).
Stick to it like glue
Here’s another reason why I might be finding it hard. Apparently, it’s important to force yourself to stick to the new routine, until it’s become a new habit. You need to ‘form a chain’ and ‘keep the chain going unbroken’ in order for it to enter your subconscious. This means I’ve not helped myself by skipping a couple of weeks. Even if we’re too tired to do the whole task, we should still do something at the designated time, even if it’s minimal. For example, I should maybe file one piece of paperwork, or do one tiny piece of admin, which takes 5 minutes, to help my brain process this as the forming of a new habit, even if I don’t take a full half an hour.
It’s an interesting point, and I’m going to try and see if there’s a way I can embed my weekly review more into my existing routine, or at least do one tiny task each week, to see if it makes a difference.
Ask me in a few months how I’m going….! Good luck with any new habits you might be trying to form too!