Master Your Financial Psychology: The Key to Making Financial Decisions Beyond Budgets
Real financial power is knowing that financial decisions are made from your psychology, not budgets and books.
Don’t write down a wishful budget because like every month, you will fail.
If you want to eat out less don’t just put down on your budget “I will only spend 300 dollars eating out.” Anticipate your impulsive triggers and dedicate time to meal prepping. Avoid the decision fatigue of “What will I eat today?”.
Outside Influence
Keeping a budget is great because it keeps you aware of where your money is going and what areas you could improve but at the end of the day your decisions are more emotional then rational.
But, define the game you are playing and make sure your actions are not being influenced by people playing a different game.
You have to be okay with playing your own game to move to the next level.
With social media, it’s so easy to compare to others and feel like you’re behind in life or as if you’re doing something wrong. Or it’s easy to listen to advice from people like me who have their ideas, and emotions, and own personal psychologies about money.
I don’t make decisions the same way you do but I do have to make decisions that actually move the needle forward.
But what works for me might not work for you.
You might have a clear budget and goal that you want to hit but a lot of our decisions come from how our decisions will affect others and not how much return on your investments we might make.
We might have friends we want to impress, a wife we don’t want to disappoint, kids that want new toys and games, or a new TV or concert we want.
We need to exit the rat race of keeping up with years and years of subconscious training that has been done to us by our environment, friends, family, or media and modulate our own activities for our own peace of mind.
Eliminate what doesn’t move the needle forward and you will gain clarity on what steps to take next.
Do what works for you, make sure your goals are actually yours, and have a budget, but most of all, eliminate as many as possible of the emotional and psychological triggers that will derail you from your main financial goals.
