Have you ever wondered why you don’t always act in responsible ways when it comes to money? Or maybe you are financially fit and find it hard to understand why a loved one seems to spend or invest money in an irrational manner. The reason is simple. There is an upside to every bad money behavior. That is why it is so difficult to change poor habits, including unhealthy financial habits. The short-term gain keeps you coming back for more.
Dan is a great example. He loves to buy expensive gadgets but knows that he spends too much of his take-home pay on these toys. Dan knows that this spending behavior is getting in the way of his goal to save for a down payment for his first home. When asked, Dan tells me that he wants to stop overspending on electrics. But his actions tell a different story.
What Dan doesn’t realize is that buying something new gives him a rush, makes him feel good after a long week at work and boosts his self-esteem. All his friends fondly call him “the gadget guy.” There is a big upside to this unhealthy money behavior. Until Dan appreciates the benefits of this habit, it will be hard, if not impossible, to change.
Do you identify with Dan? Do you have a habit or behavior that you would love to stop but find it difficult to let go of? If so, here are some inquiries for you to consider.
What is the short-term benefit of this money behavior?
As a trained behavioral change specialist, I always look for the brilliance in the bad behavior. In other words, what are the benefits of staying stuck or not changing? In Dan’s case not changing his spending habits helped him feel good about himself and good in the moment.
What would it be like to not receive this short-term benefit?
The first step in changing an unhealthy habit is realizing how it serves you. In Dan’s case, the bad habit was paired with feeling good and special. If he is going to save more money and spend less money, he will have to grieve the loss of the excitement he feels each time he buys the latest gadget. This is not an easy task, but possible. It is easier to sit with uncomfortable feelings once you label them and know that feeling them is temporary and part of what will ultimately help you heal.
What other coping strategies can I use to get these needs met?
Dan’s desire to feel good about himself is not unhealthy and in fact, is a good thing. It is just that how he is going about it is hurting him financially. When you want to change a habit make sure you find other ways of meeting your underlying need. In Dan’s case, he started a blog about gadgets. This way he didn’t have to buy every toy but could stay up on the latest trends in electronics. He also was still seen as the gadget guy by his friends and that was an important part of his identity.
Asking these three questions will help you identify the upside of any unwanted money habit. While the answers are not a magic wand, they do provide valuable data to aid in the change process. So the next time you are beating yourself up for a bad habit, instead wonder about the upside.
What is an upside of an unwanted money habit for you? What strategies help you change an unwanted money habit?