Eeeish, it’s easier said than done!

The other day, a follower of my column wrote: ‘I have been reading your Personal Finance column for a year or so and I have found it really inspirational. My problem is that I can’t get past the inspirational part. Several times, I have tried to implement your tips. What I find, though, after a week or so is that I just get frustrated with all of it and I quit and go back to doing exactly what I was doing before. How do you start changing if you can’t even tackle a handful of simple changes like this? Your advice is easier said than done, Thom!’

I really empathised with him. It is never easy, but it is possible with determination to have a sound personal finance life. In order for change in your personal life to succeed, you need several elements.

The starting point is for you to have a goal. Why are you doing this? Where do you want to be in five years? Is the plan to be out of debt? What will you do with debt freedom? Do you wish to own a house or a better career?

Don’t spend your time worrying about specific money-saving tactics right now. First, spend time really thinking about your future and what you really want from it. Where do you want to be in a year or so? What do you aspire to be?  Flesh these goals out. It is the goal you set for yourself that will determine the seriousness with which you will treat your finances. Trust me, once you are beginning to realise your goal, your finance life will glide along. For example, once you start building that house, you will always want to spare your money and buy a bag of cement. Once you start doing that diploma or degree, you will reduce on your beers and spare money for a book. Once you are in huge debt, every opportunity to make and not spend money counts. So the goal will push you into action. Just set the goal and get started on pursuing it.

Let me be quick to caution though that your goal should be achievable–so that the little achievements you make give you the strength to go on. If you are too ambitious, you can easily get frustrated at the seemingly insignificant progress you are making and then give up. 

Setting your goal and planning to achieve it, is the first taste of success, and it’s usually an inspiring one. You have got goals and plans for getting there. Doing this by itself, is a success of great proportions.

Once you have set your goal and plans, it’s time to start with the behavior changes. However, I am going to suggest that you don’t do a bunch at once. Instead, pick out one change and focus on maintaining only that one change for a number of days. For example, you want to build a house but do love a whole host of money-robbing habits i.e. you love your beer, you love going to tourist sites each month end, you love going to music shows, you are addicted to coffee. If you decide to reduce on beers, then stick to it for now. Don’t reduce on the other ones at the same time—you will be so miserable and will end up giving up saving on any of them sooner than later. Don’t force too many changes at once.

Again, figure up how much you are saving from that one behavior change and roll that savings into one of your plans for the future. Take it slow. Every step you take is a real improvement, and it’s far better than not taking any step or taking too many steps at once.

By the way, the same tips apply at the country level and they are behind the wealth of the Asian Tigers.

Blessed week-end to you and yours as you make goals and plans for the future. Remember, one small behavioral change at a time!