Habits - The Good & The Bad (part 2)
By Kevin Gibbons
In our previous article, I talked about why cultivating good habits is so important. They make mundane or repetitive tasks rote so you can devote more of your brain power to the more novel or important things in your life. I also gave the example of how to make tracking your spending a habit.
In this article, I want to focus on two other critical aspects: the importance of breaking bad habits and making continuous improvement a habit.
A Foolish Consistency…
“A foolish consistency is the hobgoblin of little minds…” wrote Ralph Waldo Emerson in his essay Self Reliance.
We all have many habits we use to get through our daily lives. We’ve developed most of them unconsciously, simply by repeating our behavior until our bodies almost know what to do without our thinking about it. In many sports activities, we actually train ourselves to use “muscle memory,” so our bodies can react to a situation – a baseball coming at us at 90 mph, or shooting a basketball in mid-stride – without us having to think through every step of the complicated process.
Sometimes, we’ve developed bad habits. Maybe because the actions addressed an immediate need, but had delayed or long-term negative effects, like shopping on-line after a hard day at work. You get the immediate relaxation, and maybe the endorphin rush of finding something new and exciting, but your judgment may not be at its soundest, so you end up with a lot of stuff you really don’t want or need. Or maybe your needs have changed, and what was once a useful habit no longer benefits you.
The thing about habits is that they function without requiring thought from you. So it is easy to keep doing them. How do you break a bad habit? The process is a little different than creating good habit, as anyone who has tried going on a diet or quitting smoking has experienced.
First, you have to know you have a bad habit. That means taking stock of your life, habits, routines and actions. The key is to not just do this in the middle of the habit. Set aside the time as a “mental health check-up.” You want to take some quiet time and reflect on how you do things, how you go about your day, what you do unconsciously. Then you can critically determine if you want to continue doing it.
Think about times in your day that trigger behaviors. Just like smokers often key on the after-meal cigarette, look at what you do at specific times of the day. (For me, it was buying junk food at the end of my work day to eat on the long drive home.)
Second, find a replacement habit. When you are creating a new habit, you can do it in a vacuum. “I have not been doing anything in this circumstance. I want to do this specific set of actions going forward.”
When you want to break a habit, your mind and body will strongly desire to respond to the trigger. Doing nothing in place of something will be deeply dissatisfying. Instead, do something else. At the same time, change the trigger so your impulse gets a little confused.
To continue my personal example, when I wanted to stop spending the money on the junk food, I did two things: I made sure I had a healthy snack to eat instead; but I also changed my route so I didn’t drive by the convenience store anymore. I replaced the bad habit (buying junk food) with a desirable one (eating something healthy) and I modified the trigger (I still had to drive home from work, but I broke that association with the convenience store).
Lastly, give yourself a reward when you succeed. If you have a dog and you want to train it, you treat it consistently, introduce the desired behavior and reward it when it performs the behavior. You reward it with something it finds desirable, maybe a treat, a toy or lots of praise. That same feedback works with you! Give yourself something you want when you successfully execute the habit. That little endorphin rush really is a key part of successfully incorporating new behaviors. It’s not so much about intelligence or willpower as it is about creating new performance-reward pathways.
Continuous Improvement
“Continuous Improvement” became a buzzword in tech and industry about 25 years ago. The idea was we should always be looking at making small improvements that incrementally will increase quality, improve efficiency and reduce cost. The same idea is true with our personal lives and habits.
You don’t have to hit a home run to be a good baseball player.
You can make small, incremental improvements in how you lead your life, each one of which may seem almost inconsequential, but together, can result in significant changes. The key is to keep making them throughout your life. It’s the same principal behind compound saving. Changing your behavior to reduce your spending by 1% every year does not seem like much, but if you spend $75,000/year, that’s $750 your first year. Not earth-shattering, is it? But compounded over 20 years, that’s over $160,000!
If we assume a modest 3% annual return on that savings, that number grows to just over $200,000! And that is not taking into account any pay increases you may get over those 20 years. It’s just looking at reducing your spending by 1% every year.
The point is, making small changes throughout your life can move you from where you are to where you want to be. You don’t need to feel overwhelmed by having to do it all at once. Just look at how you are living your life:
If you like something you are doing, think about how you can do it just a little bit better.
If you don’t like something, think about how you can change it by replacing it with something that is more in line with living the life you want to live.
Resources
For years we’ve been recommending The Power of Habit by Charles Duhigg. This is the go-to book on how to create good habits and how to replace negative habits with positive ones.
James Clear’s book Atomic Habits is another excellent guide on how to create good habits, break bad ones and execute the tiny behaviors that lead to incremental change.
Kevin Gibbons is a Cash Flow Planning Expert, the Vice President of The Savvy Life and co-author of the international bestseller Living The Savvy Life. For the past eight years, Kevin and Savvy Life Founder Melissa Tosetti have worked with over 625 individuals and families to create Spending Plans.
To learn about how Kevin and Melissa work with clients to create Spending Plans, visit The Savvy Life’s Home Page. If you’d like to learn about how they work with financial advisors and their clients visit: The Savvy Life Advisor’s Page.
