Your Money Habits – Out With the Old, In With The New

  • By NestWise
  • April 01, 2013

your money habits—out with the old, in with the new

A new behavior may take 90 days to become a habit. Small steps, expert advice, and being patient with yourself are all part of it. Here are some suggestions to help you be successful on the path to forming new financial habits.

If you’re in the process of making changes to how you handle your finances, such as tracking your spending, getting on a budget, or cutting costs, you’ve probably realized that you’re going to need some support to turn new actions and choices into long-term habits. As with many things in life, however, making these changes isn’t easily done overnight. A commitment to acquiring new habits will likely take time – and some extra patience.

Here are a few suggestions to help you along your new path:

  • Start small. We’ve all seen dieters that stumble after a few days because their regimen of tasteless micro-portions is asking for too much change immediately. Think of your financial “diet” in the same way. Try taking smaller, incremental steps that allow you to gradually build your experience and attain modest goals. You can also set short timeframes to begin – then slowly extend them.

  • Automate. You may find it helpful to take advantage of products and services that make the mental workload a little easier. Consider looking into automatic bill paying, direct deposit and your employer’s 401(k) plan.

  • Take it easy on yourself. Even if you start with modest goals, you may not make them. Or you might succeed for a while, and then fall back on an old habit. That’s OK! Try to focus on what you have accomplished, pat yourself on the back, and get back to your new habit as soon as possible.

  • Build a structure. You’ll probably find it easier to take on new habits if you schedule consistent times for different activities. Maybe you need a set time for examining your budget or online banking – try to establish routines, and stick to your commitments each day or week. Consider setting reminders in your calendar to prompt you while the new routines are being formed.

  • Tell somebody. Changing a big part of your life is hard enough – why not make it easier for yourself by seeing if a friend or family member can be part of your support team? Even better: find somebody who wants to try the same new habits as you.

  • Make old habits harder. Try to remove anything from your life that tends to encourage your old way of doing things. Discard the credit cards, take a break from cruising stores that tempt you, unsubscribe from Groupon emails, or move some of your social activities away from outings that cost money.

  • Check in. It may make sense – especially in the first few days of weeks of a new habit – to periodically assess your own progress. Are you on the path to a new habit you can continue for a long time? Or do you need to adjust things to give yourself a better shot?

Forming new habits is hard work, but if you start by setting modest, realistic goals –and employing a few of the above tips- you will increase your chances that over time, the new habit, just becomes what you automatically do.


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© 2013 NestWise A Registered Investment Advisor