Three Habits To Transform Your Finances

Today, I want to step back a little bit, and give you some encouragement.

Sometimes if you’re just learning YNAB or just learning budgeting in general, it can be slow and frustrating and you start to wonder, “Why am I even doing this? Is it really worth it?”

I’m here to tell you it absolutely is worth it. But at the end of the day, there are really just three, simple habits that can completely transform your financial life.

#1: Tracking

Someone once said, “What is measured, is improved.” I don’t know who said it but it is true. Right now I am tracking my food: grams of protein, fat and carbohydrates. And I have them very precisely dialed in. Does it mean I should always be measuring the ratios of every meal? No. But does the specificity help me make progress toward my goals? Absolutely!

When you lose the specificity, when you just start saying, I’ll just kind of get a general feel for how things are going, a general feel with my money to see about what’s happening, you lose control.

If you want to see change, get laser-focused and track everything. There will be some variance—you accept that, because we are alive—and you make a positive impact on your finances.

Track every single penny you spend. Everything is accounted for. I’ve been doing this since I was 16. I would just write it down, every single penny. It is a powerful habit because when you are aware, you start to make better decisions. I’ve started making better decisions at meal times because I’m more aware of the impact on my macro breakdown. Same thing.

#2: Waiting

When you want something—wait.

Basically, what you do is you analyze what everyone who wants some of your money—every retailer, every marketer, every bank—is trying to get you to do and fight against that. Your biggest weapon is simply to wait. You wait.

Two-day shipping, one-day shipping, you wait. Same-day shipping with a drone, I can’t wait. But you should wait.

The idea of waiting for things, delayed gratification, helps tremendously in just letting you step back, shed some of those impulse purchases that sometimes surprise you. Just wait a little bit.

Waiting is powerful. Wait, wait, wait.

Whenever you’re making a big decision, just wait. When you’re making a small decision, just wait. Put it on a list. I have a books wish list, and whenever I want to buy a book, instead of buying it, which is what I used to do thinking I would read it — I own tons of unread books — I now have a wish list of unread books. And that’s far more tolerable and healthy for my wallet.

#3: Review

You’ve been tracking. You’ve been waiting. You’ve been exercising patience. Now, I want you to review.

Part of the budget process is just essentially reviewing. How am I doing? How is that tracking going against my budget? Do I need to adjust my budget? Do I need to make some changes?

Adjust as necessary. Learn from your habits. Keep tracking. Keep waiting. Review again. This is it.

Why? Because It Works

These three habits seem simple, but they work. And not just for your finances. These three rules apply to a lot of areas of life as well: food management, setting and achieving goals, running a marathon, bench pressing 300 pounds—all sorts of things.

I whole-heartedly believe that these three habits can transform your finances.

Track your activity. Wait and practice delayed gratification. Make it a game. Then finally review your progress. That’s it! That’s everything we’re focused around with YNAB. There are some rules in there for effective budgeting but it’s core, is just a lot of these three habits. You hit these and you’ll be well on your way.


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