From money wise.
- Each year 40 % of people make New Year’s resolutions only 10 fail. In less than 3 weeks, around Jan 19.
- American journal of physiology defined a habit>a more or less fixed way of thinking.
- Webster: an acquired mode of behavior that we do so often that we no longer think about it.
Seven insights to help:
- clarity is key. Whatever finances are measured, it is managed.
Money has become largely invisible. Automated payments. Stopped carrying cash, and use of credit cards.
You need to keep track of your spending. You can track your spending with the upwide app.
b. goals are good. Benchmarks are better.
Break them down. If you want to save $5 for the year break it up in smaller, more defined goals.
Add a deadline. Instead of $K a year save $100 a week for a year.
Don’t go too easy on yourself. A challenge leads to change. Goals need to be achievable.
c. Make those benchmarks bite-size.
UCLA university experiment. Have people save 150 a month. $35 a week or $5 a day. If did $5 more people more inclined to do it.
d. Keep yourself accountable.
Tell at least one person.
Consider a cash committee member device. Give yourself a financial fine if you fail.
e. Let the automation help when it can.
Sometimes life gets in the way.
If you can see it, you cannot reach it.
Apply 401K magic liberally. Money zapped before in net check. You might also to automate funding for other goals besides 401K.
f. plan for the ‘ifs”
implement the if/then framework. If X happens, then I will do Y.
Things you can plan for:
if I walk past a coffee shop, I keep walking because I don’t want to spend money on coffee.
If I get a raise, I will put more money aside for 401.
g. pity a good day to make a fresh start.
You can start your new year’s resolutions like the beginning of the month, or restart the next week if you fumble.
Q&A: how to find ways to free money: we need to monitor your money spending. You may see spending money you regret or you didn’t value.
Take a daily look of your funds. Make it a habit and it can become part of our routine
Moderator: use envelopes to set money aside for different goals.
Reviewing your finances daily can help you catch unknown charges more quickly
behavioral change and emotions around money
with how we are rushed for time we will use shortcuts to make decisions. For example, we might see the behavior of other people to make our own decision.
Mental accounting: how we have different buckets for expenses and income.
Save for vacation in advance. It is already out of your budget.
If we think we’re going to get bad news, we want to not think of it. If people look at the credit report, they tend to make credit reports better.
