Pick Your One Thing
I was recently talking to a frustrated parent who was sharing their displeasure with their grown child’s financial habits….or lack thereof. In the conversation, they listed a dozen things this young adult needs to do better in order to get their financial life back on track. Things like stop spending on frivolous things, save more, get an emergency fund, get a second job, pay off their debt, start investing……and the list goes on and on. These things very well may be true, but there was a problem. If this young adult actually tries to do all these things, they will inevitably fail. They can’t go from having little-to-no healthy financial habits to implementing a dozen new things into their life at once. That’s a setup for defeat. It’s like telling me - who wants to get in better shape - I should run 3 miles each morning, do some yoga during lunch, and lift at night……7 days per week. There’s no chance I make it even 4 days doing this. Personal finance is the same.
If I were sitting down for coffee with this young person, I’d tell them to pick one thing and get really good at it. Any one of them would move them in a positive direction, but they must pick one and focus hard on it. Through repetition, they will create a stronger habit and continually get better at it. Eventually, it will just be something they do, like brushing their teeth.
For most people, the best and most effective place to start is to get in the habit of budgeting. Accounting for ALL income they have coming in this month, making sure each dollar has a purpose (spend/save/give), executing that plan, and tracking their progress. Then repeat again next month. The first few months will likely be ugly, but give yourself grace. Learn from the experience then do better next time. In a handful of months, you’ll wonder how you ever handled your money without a budget. Once you lock down this habit, all the other aspects of personal finance become accessible.
Even if you do well in this money arena, there’s always room to grow. What’s your one thing for this season of life? What one thing will you implement to enhance the quality of your life?