Habits, Wealth

What Really Changing Your Money Habits Looks Like

What Really Changing Your Money Habits Looks LikeRecently, I was having a conversation with a friend and client. He’d recently gone through an accident and had to spend a good deal of time out of work, further compounded by pneumonia. This set him back considerably, and he mentioned to me that he was coming up about $200 short each month. As we dug deeper into the situation through our conversation, I took note of several things. First, he was drinking beer, and, I’d noticed he was drinking beer the last few times I’d spoken with him. I mentioned that in light of his circumstances, he might want to forego the recreational drinking. Of course, I then got to hear more than a few minutes about his justifications for spending the money on his beers.

Then the conversation migrated to football season, and I asked him if he had cable tv, as, he’d mentioned watching the games. I asked him how much the satellite tv ran him a month, and he said it was close to $180/month. Again, I mentioned that, perhaps, in light of his financial situation, it might be time to turn off the satellite tv service for awhile, and that, it alone would nearly cover his deficit. And again, he mentioned for quite a long time, how many reasons why he needed to keep the cable going.

Now in just these two observations, we’d reconciled the deficit, but he was unwilling to “do without” these conveniences. And it was then that I told him that these habits were preventing him from getting back on track. I’d never suggested that this had to be the way he needed to do things forever. These were temporary adjustments to allow him time to catch up on his shortfalls and expenses. And, it honestly amazed me that he couldn’t see the logic in it. But this brings up the very core of rooting out and changing habits that are sabotaging your financial future. We are naturally inclined to stay the course, do the things we find familiar, even if they are counter-productive.

The greatest habit I could advise anyone to commit to, if they want to be financially prosperous, is to learn to delay gratification. The need for immediate gratification is the central factor to most excesses in expense, and so often, the cause of either financial struggle or the excuse for not saving money for the future, or to invest and allow compound interest to grow it into wealth.

Somehow, we often feel like doing these things will cause us to “miss out” on the good stuff. But, really, while it may take a little while to bear fruit, these actions, as boring and “un-sexy” as they are, can create the proper conditions to greatly enhance your lifestyle. And once you’ve made these small adjustments, you’ll often be surprised at just how little you miss the things you thought you “needed” so badly.