3 Steps to Breaking Bad Money Habits

Hi Money Masters!

How many times have you said to yourself, “I have got to stop doing that”? It could be biting your nails, grinding your teeth or leaving the cap off the toothpaste. We all have our bad habits. But bad habits can also be prevalent in the way we handle our finances. Never fear- Helen is here!

Psychologically, a habit (good or bad) follows a cycle… Trigger- Behavior- Reward. You can’t fight nature but we can use it to help impact our finances in a positive way.

Let’s look at 3 steps that can help you banish bad money habits.

Step 1: Be Selective 

Rome wasn’t built in a day so it’s not very realistic to try and tackle all your bad habits at the same time. Pick 1 to 3 and start from there. I find that writing them down helps. Keep them in your phone or make a list and stick it to the fridge door or inside your wallet.

Finding the reason why (TRIGGER) these bad habits occur can also help be part of the solution. Do some soul-searching to find what’s behind these behaviors.

Here are some good examples that could be on the list for many people:

EXAMPLE #1

Bad habit: Eating lunch out every work day.

Why: Poor meal planning or time management.

Solution: Pack a lunch. It might mean getting up earlier or prepping a meal before bed.

EXAMPLE #2

Bad habit: Making late payments.

Why: Lack of organization or improper budgeting.

Solution: Ensure you have an up to date budget and set up automatic payments when possible.

Finding the motivation you need to keep focused is critical to your success. Once you understand the reasoning behind the bad habit you can use that information to your advantage to ensure history does not repeat itself.

Step 2: Build Up Better Habits

Now that you’ve identified your target bad habits (BEHAVIOR), you can replace them with good habits! You are now conscious of these habits. For instance, if your bad habit is buying a coffee every day at $3-5 each time, train your brain to think about how you can save that $3-5. Visualize in your head putting the money into a piggy bank. It may sound strange but try it 😉

Here’s another idea. If you have a habit of scrolling through Amazon looking for things you probably don’t need, start Googling articles on saving money or how to invest.

Good habits don’t take long to form so stay on track and be consistent!

Step 3. The Reward  

In the “trigger-behavior-reward” cycle I mentioned earlier, the reward is that part of the habit that makes the brain say “Oh, this is cool!” Thus, it remembers the cycle. If you can develop good habits when it comes to your money then you will see an improvement.

Once your bad habit is kicked and your good habit is in the driver’s seat then go ahead and REWARD yourself! Go get that coffee once a month or find a treat online.

Hopefully, you have a better understanding of why your bad money habits occur and are now motivated to change those behaviors into a positive path to better money management and growth!

Blessing to you all,

-Helen