Finding Our Blind Spots

I took my kids to their annual wellness check-ups yesterday. Considering blood draws and flu shots were involved, it was a train wreck. However, this won't be a rant on the futile attempts to get needles jammed into my kids' arms. It's what happened before the needle-stabbing incident that got me thinking.

We started with a simple eye test. You know the exercise. Cover one eye and read progressively shrinking lines of letters on the back wall. Pax was first up. He boldly and proudly read aloud each letter and finished with a big smile. Next, it was Finn's turn. As he read the letters, Pax, the doctor, and I all looked at each other in bewilderment. He didn't get a single one right. At first, I thought he was just clowning with us (which is totally a Finn thing to do). Then, he switched eyes and exclaimed, "Now, my good eye." Wait, what!?!? Good eye?!?! When I asked him what he meant, he responded, "This is my good eye, and this is my bad eye." Again, what!?!? He went on to nail every single letter on every single row. It was a humbling parenting moment, but up until today, I didn't know he had a "bad eye." Humbling....very humbling.

That brings me to the topic of blind spots. There are things in life we don't know. And the problem is, we don't know what we don't know. That's why they are blind spots. Turns out, one of my figurative blind spots is Finn's literal blind spot. Ouch. We have some work to do!

We all have blind spots, which can span many different areas of our lives. When sitting with a client, I can quickly pick up on their financial blind spots. Everyone has them, but there's one characteristic that determines what happens next: humility. If someone has humility, they can recognize, face head-on, and remedy their blind spots.....which often leads to some pretty transformational results. If they don't, they will most certainly carry their blind spot into the future.....which can lead to some dark places.

I used to have a blind spot with debt. My old way of thinking almost ruined my life. I used to have a blind spot with investing. My old way of thinking would have significantly hindered my progress. I used to have a blind spot with the connection between money and happiness. My old way of thinking likely would have led me down a dark and materialistic road.

I'm sure I still have plenty of blind spots, but I'm always willing to expose them and face them head-on....even if it hurts. It's uncomfortable in the moment, but we're so much better for it in the long run.

What are your blind spots? What areas of your life secretly hold you back from living a better life? Here's a scary but effective way to find out: Ask those closest to you...if you dare. They know. They know all too well......

Tangibility Bias

If you had $100, would you use it to:

1. Buy that object you've been wanting.

2. Give it to someone who is struggling.

3. Pay down a debt.

4. Save it for an upcoming expense.

5. Go out for a fun meal.

Let's up the ante. If you had $25,000, would you use it to:

1. Deposit it into your kid's college fund.

2. Give it away to a charitable organization.

3. Buy a vehicle.

4. Use it as a downpayment for a house.

5. Contribute to your retirement account.

In the first example, most people would buy the object or the meal. In the second example, most people would use it to buy a car or a house. It's not because these are right or wrong decisions. It's because of something subconscious. I've watched people make these decisions for years. Time and time again, I can guess what most people will do.

It's called tangibility bias. It's subconsciously prioritizing things we can see, touch, and feel. Houses, vehicles, and possessions all fit this category. People are allured to the idea of buying something they can physically see. Some of these things can be good things, but it often comes at the expense of other less tangible things. Things such as retirement investing, college funds, generosity, and future needs.

• It's why a person doesn't bat an eye at their $800 car payment, but "can't afford" to invest $200 into retirement. Never fret, though, as the car "is very reliable and will hold its value well." 

• It's why a person will go from spending 30% of their income on renting a house to buying a house where they are now spending 60% of their income on their house payment. All in the name of "not throwing away money on rent." 

• It's why a person will run to the nearest Apple store to drop $1,000+ on the newest iPhone, but perpetually has less than $100 in their emergency fund. 

All three of these are real stories. There's a lot going on in each, but tangibility bias is in full force. When spending money on items we can touch, see, and feel, we'll jump through all sorts of mental, emotional, psychological, and financial hoops. 

Speaking of financial hoops, this is one of the reasons why Americans are saddled with record-high credit card, auto, and mortgage debt. At the same time, we are more under-prepared for our kids' college and our retirement than ever before. 

This is the risk of tangibility bias. We can't touch, see, or feel these other items. However, in due time, we'll touch, see, and feel the pain and turmoil we set up for ourselves. Setting our children up to be crippled with student loans. Backing ourselves into a corner where we're forced to work full-time into our 70s or 80s just to pay the bills. Putting ourselves in a position where we are cash-strapped because of our car and house payments. 

Be aware of tangibility bias. As G.I. Joe once told me, knowing is half the battle!

Death to Girl Math, Death to Boy Math

There's a new social media trend that's both silly and worrisome. It was initially called "girl math," which highlighted some of the psychological games women play on themselves to justify financial decisions. Women quickly turned the tables and started highlighting some of the ridiculous psychological games men play on themselves. Here are a few examples:

• If you spend $100 at a store and get a $10 gift card in return, that's income.

• If something costs $5.99, we mentally round it down and consider it $5. Or if something costs $47, we round it down to $40.

• Shipping will cost $5, so we add a $10 item to get free shipping....meaning we "saved" $5.

• If something costs less than $5, it doesn't really count (because that's too small to matter).

• Tattoos are essentially free, as you'll have them the rest of your life. If you live another 50 years, a $100 tattoo costs about 1/2 cent per day.....i.e. it's free.

• If you were thinking about buying a $80 product and ultimately buy a $40 product instead, you made $40. 

These posts were pretty silly, but what made them go viral was the discovered reality that many of us play the exact same psychological games on ourselves. Over time, however, the idea of "boy math" and "girl math" has taken on a whole new life. Instead of being silly, these posts have become more demeaning and condescending. While much of this new stuff is pretty dark, I wanted to share one that nearly made me spit my coffee out in laughter. 

"Boy math is being afraid of gold diggers when you only have three pairs of socks to your name."

I digress. While the original idea of girl math and boy math are generally innocent, we should shine a light on the overarching risk here. We humans love to play psychological tricks on ourselves to justify our decisions. It's one thing to do it, but it becomes something even more significant when we start to normalize, rationalize, and encourage it. 

I see the implications of boy math and girl math every day. I watch couples play mental gymnastics with themselves to justify all sorts of self-sabotaging behavior. Here's the good news. We can kill boy math and girl math in our life. Just knowing we're subject to these psychological effects can allow us to be more self-aware and make better decisions. 

At the heart of this is our desire to remove guilt. When we can justify a decision, it allows us to scrap the guilt and replace it with satisfaction. My encouragement is to face reality on reality's terms. Call something what it is, understand the true reason for our desires, and understand the actual cost of this decision at face value. Then, we can make the best decision for us. No guilt, no second-guessing, no games. If it adds more value (to us) than it costs, it's part of the budget, and we're not going into debt, then do it!

Protecting Yourself From Yourself

As much as we try, we humans are experts in the art of self-sabotage. Sometimes, we're oblivious to it, while other times, we know exactly what we do. Yet, we can't help but sabotage our own well-being. 

• Hitting the snooze button instead of going to the gym.

• Showing up to work late.

• Sneaking that tasty little snack right before bed.

• Insert countless financial versions here!

As I often tell my clients, we must protect ourselves from ourselves. It's not because we're weak, but rather because we are smart. Well, maybe we are weak......which means we need to be smart!

An example of this popped up with a client this week. This particular client struggles to keep their grocery spending in check. Sound familiar? They budget a reasonable number, have clarity on how much they are spending as the month wears on, and desperately want to stay within budget. Yet, they fail. Every. Single. Month. 

In our most recent meeting, I told them they desperately need to protect themselves from themselves. I can relate to this exact issue! We love food. If left to our own devices, my family would spend every cent on food. We can't do that, though. Sticking to the plan is a non-negotiable. 

Here's the idea I put on the table for this couple. They should open a CashApp account, which is an app that acts like its own little bank account. It connects directly to your personal bank account, so you can add or subtract money anytime. It also provides you with a debit card. Once set up, this would be their grocery account. Here's why this can be a powerful tool to protect themselves from themselves:

• You must intentionally load it with whatever dollar amount you choose. Therefore, once you budget for $x for groceries, you will deposit the money with just a few clicks. 

• Once the money is living in CashApp, you can see an up-to-the-minute balance. If you swipe your debit card in the store, the balance adjusts within 10 seconds. You always have 100% clarity. 

• It doesn't allow you to overdraft. If you have $44 in your CashApp and you try to purchase $44.01 worth of merchandise, it declines you. There's no way to overspend. 

• When the money is gone, it's gone. This is a powerful lesson. No, your family won't die. Rather, it forces you to get creative and dive a bit deeper into the pantry and freezer. We've had several "interesting" months in our house. Something powerful happens when we commit to the plan. 

• Having only one transaction for groceries (the original deposit each month) eliminates the need to continually track these expenses. It's all housed in the app with a pretty little bow. 

It sounds simple....because it is. And it can change everything! Despite groceries being one of our most challenging categories, we haven't overspent in nearly a decade. There's just one reason for this: we protect ourselves from ourselves. 

What do you need to protect yourself from yourself from? 

The First Slice is the Best!

On my flight yesterday, I had a front-row seat to a little family struggle. Here's how it played out. Mom, Dad, and 12ish-year-old son sit down right in front of me. They had to hurry from one flight to the next, but they were able to grab some food and bring it onto the plane. After the plane took off, the mother distributed the food. Side note: it looked absolutely delicious. A while later, the son decided he was full after eating about 2/3 of the meal. He looked satisfied and content. The mother, clearly annoyed, chewed him out and said it was wrong for him to waste food. She made him eat the remaining 1/3, after which he seemed stuffed and miserable. 

As I'm writing this, I keep oddly thinking about pumpkin pie. Maybe it's the fact fall is in the air, but I couldn't be more excited to slam some pumpkin pie soon. The correct whip cream-to-pie ratio is 1:1, by the way. Anyway, the holidays are quickly approaching, and soon, that pie will be mine! Eating that first slice of pie is going to be outstanding. That second slice won't be as amazing, but I'll also enjoy the heck out of it. The third slice? That one will start to feel iffy. And the rest of the pie? If I were to put down the rest of it, you'd have to carry me to the hospital.

How can the first slice of pie sound so amazing, but the eighth slice sound absolutely unbearable? It's called the law of diminishing returns. The more we have of something, the less satisfying it becomes. That's where we get the saying, "Too much of a good thing." Whether it's the young guy on the plane or me slamming Thanksgiving pumpkin pie, we're all impacted by this phenomenon. Everyone over the age of 12 intuitively understands this concept, especially when it comes to food. 

However, we have a blind spot. It's called materialism. 

• When we get our first iPhone, it revolutionizes how we engage with people and access information! However, when the newest model comes out next year, and we spend our hard-earned money to upgrade, we're barely getting anything for the money.

• When we take that long-awaited vacation with our family, it's an amazing, creating lifelong memories experience. However, when we take our 6th vacation of the year, it becomes just another trip. 

• When we finally build up an adequate emergency fund to protect our family from a serious life situation, it's a tremendously relieving feeling. However, when we endeavor to double or triple that number, we feel only slightly more secure. 

Without realizing it, we work our way into too much of a good thing. Everywhere we look, the law of diminishing returns is knocking on the door. We can ignore it and keep falling for the trap, or we can open the door, admit we're prone to these psychological influences, and make more intentional choices. 

Now, where's that pumpkin pie?

Jumping Off the Treadmill

I experienced a very profound moment in my life around 2015. It was a few years after paying off our $236,000 of debt. Sarah and I were still in the midst of our fertility battle, but optimistic about possibly adopting a child soon. My career was thriving. And I was making many multiples of income from what I previously made. Reflecting on how blessed my life was, I couldn't help but feel it wasn't enough. It was all just, well, normal. 

This is the season of life where I started pondering what would eventually become Meaning Over Money and my new career. It's also when I started digging deep into the behavioral science of money, work, and happiness. 

The Hedonic Treadmill. I talk about this concept in my keynote, but it also leaks out in many other areas of my work. You may have heard it on the podcast, read it here, or caught it during an interview I gave. The topic comes up often, as it plays a critical role in our lives. In short, the Hedonic Treadmill is a phenomenon by which anything that happens to us, good or bad, becomes normal. We experience up-front pain or euphoria, but in a matter of weeks, we're back to being normal (albeit a new version of normal).

I've experienced the Hedonic Treadmill many times in life. Also, I watch many clients work through it in their own lives. What's interesting is how people interact with it differently IF they recognize it's happening. 

This leads me to a few recent observations:

• I was meeting with a young couple who make around $75,000 combined. Through the course of the conversation, they reveal their desire to get that number to $100,000. Why? Because that's the number that will allow them to feel confident financially.

• I was having a drink with a friend. He mentioned he makes around $120,000 per year, but it feels tight. In his opinion, if he could get it closer to $150,000, they would be set. 

• I spent some time with another couple who frustratingly vented that their $200,000 income wasn't enough anymore. They didn't know the appropriate number, but it's definitely more than $200,000.

• One of my friends proclaimed a family can't survive in this town with an income of only $335,000. 

Several studies have been done over the years around the question of "What is enough?" Well, what is enough? In the overwhelming majority of cases, it's more than whatever their current situation looks like. It's the Hedonic Treadmill in action! 

Back to that profound moment I experienced in 2015. One of the revelations I had during that season was this. Despite making many multiples of my younger self's income, I didn't feel any happier. My younger self wouldn't have believed what older Travis was making, yet it was just "normal" for me as I was living it. The Hedonic Treadmill was kicking my butt.

I had to jump off the treadmill. Do you, too?

A Bad Mow Is Better Than No Mow

As I got home yesterday afternoon, something drew my eye to my backyard. What I saw wasn't pretty. The grass was short and gray, but the weeds were tall and green. It looked like an absolute disaster. I'd show you a picture, but not even I'm willing to incriminate myself that badly. To sum it up, the state of my yard was a perfect combination of traveling for 8 of the last 12 weeks, long stretches of brutal heat, and a significant lack of available time on my part. I'm not proud of it, but realize how I got here.

Truth is, I've had some windows to make progress on the yard and similar projects. However, these windows would not have allowed me to do it well. So instead of choosing done, I decided to wait for perfect.....which never came. Last night, though, Pax and I mowed the yard together. He had a blast and worked hard, but he's a terrible mower, just like his brother. It doesn't look great today, but it looks WAY better than before we mowed it. A bad mow is better than no mow.

It reminds me of the wise words of my business partner, Cole. "Done is better than perfect." It's a motto he lives by. I also try to implement it in my life, but in cases like my recent yard debacle, I whiffed. This concept applies to many areas of life. 80% is always better than a future (but not likely) 100%.

Budgeting is much the same. Even if we screw up a few categories, we're way better off than had we thrown caution to the wind. It's better to miss the target by a measurable margin than to throw our hands in the air and dismiss the mission altogether.

If we have a few dozen financial transactions to categorize, even knocking down a portion of them is better than waiting until we can do them all. In the meantime, more transactions will stack up, making completing the task progressively harder and more intimidating. Next thing we know, we're so far behind that we just give up. In an effort to get it perfect, we self-sabotage and fail to get it done at all. This is a common problem encountered by clients. As a solution, I suggest they find small 5-minute blocks throughout the week and knock out small pieces. It doesn't lead to a perfect outcome, but they make steady progress along the way, allowing for the possibility of being done. This can be a massive win.

Insert whatever financial topic you want here. Budgeting, investing, saving, or giving. Or insert whatever non-financial topic you want here. Writing that book, the house projects, the old friend you've been meaning to reconnect with, or the fun hobby you're excited to crush. We can wait until the perfect time (which probably won't come), or make imperfect progress. I've learned this lesson the hard way enough times.....I'm ready to just be done.