A better year, this year

Now that you’ve audited your year, this is where the behavioural side of this financial technique comes in. The audit doesn’t end with clarity, but it does give you a jumping-off point to agree that this year could be a much different, much better year.

Where can you cut back? Where can you invest more, wisely? Where can you make more money? These are questions we benefit greatly from asking and from making real progress toward meaningful outcomes.

Just keep in mind that nothing is going to jump off the spreadsheet and change your life. Your behaviour will change your life this year, so let’s get at it.

Here are a few examples of how The Audit can translate into behavioural change.

1. Where can you cut back?

A few client’s I’ve worked with went through the Audit process and came out of it with a large number under the clothing investment category. After asking a few questions, we uncovered an emotional driver behind the spending. When they didn’t feel good about themselves, they would go to the mall and buy something to feel better.

The audit revealed thousands of dollars spent on retail therapy that had no long-lasting benefit beyond a short-term lift in mood. I would argue that the feeling would return regardless of how many items of clothing one person owns. The two are unrelated. It simply happened to be their coping mechanism, and we all have our own.

Since this pattern was to go to the mall when they felt this way, my recommendation was to identify the feeling in the moment and not step foot in a mall for a year. If they could stay out of the mall, they wouldn’t spend the money. The next recommendation was to process those emotions with God and a professional in order to address the insecurity driving the behaviour.

Can you see the process interrupt here? Identify the feeling driving behaviour, put a commitment between the feeling and the behaviour, deal with the feeling then hope it redirects the behaviour.

2. Where do you need to invest more, wisely?

We all need things, but we don’t all need a new laptop. Having a chaotic attitude toward your own investments is deeply detrimental to the one person investing: you.

Constant chaos or crisis thinking is not always a conscious belief, but it is a behaviour many people embody, often because we avoid taking responsibility for our financial habits. Planning ahead allows us to avoid large, unexpected purchases.

During the audit and while planning for the year ahead, I encourage people to think through scenarios like the following.

My vehicle has 160,000 kilometres on it, and I don’t want to buy a new car. I can invest in an extended warranty for the next three years to help manage the financial strain that often comes with higher mileage vehicles. This allows me to avoid major repair bills when something fails unexpectedly, like air conditioning in the middle of summer.

My laptop is starting to slow down. Can I buy a warranty with the next one, use credit card points, or purchase a less expensive model? Planning this ahead helps avoid the crisis of a mid-year breakdown that disrupts all other expense planning.

Moving this year is going to be expensive. Doing part of the move yourself, if you have the time, can save a significant amount of money and give you stronger muscles in the process. Buying additional furniture from Facebook Marketplace or secondhand stores can also save thousands of dollars, depending on the scale of what you need. This helps avoid spending $2,000 on a new couch simply because you urgently needed somewhere to sit and didn’t plan ahead.

Thinking ahead keeps us in control, proactively planning ahead for stressful times and allows us to make a decision when we are calm about how to proceeds in a reasonable way that’s not going to ruin our financial year.

3. Where can you make more money?

This one is going to hit hard, and I’m hoping nobody sends me a nasty email as a result. I’ve noticed a pattern that won’t be popular to write about, but it’s important to be honest about my findings.

Many people who are behind in their finances lack work ethic.

There, I said it.

Yes, emergencies happen. But the most common reason I’ve seen women fall behind financially is a lack of strong work ethic, and the lack of discipline at work often bleeds into a lack of discipline with finances. First its getting behind on bills, then it’s getting behind on filing taxes, then three years later, your credit cards are frozen, your house is at risk of being reposessed and the CRA comes knocking with a 6 figure bill that you never intended to pay. I’ve seen this scenario and it’s not been once. And somehow most of the women I’ve seen in this circumstances wear really damn nice clothes, designer bags and would look like a million bucks but the dark circumstances underneath it all say differently.

Here’s the antidote. We need more boundaries around our dollars and our free time. This means we need to work more; more hours, more jobs, more efficiently, and more diligently. This is how we make more money and begin climbing ladders at work instead of taking a defensive attitude with bosses over negative performance reviews or claiming we are being held back from our dreams in life because we don’t have money while only working ten hours a week.

If we are behind financially, in my humble and unpopular opinion, there is no reason to work less than sixty hours a week even if it was at minimum wage. We all need one full day of rest, one true Sabbath, and anything beyond that should be dedicated to work and serving God. Hard work, uncomfortable work, boring unskilled work. Whatever it takes, whoever is going to pay you and you’re not compromising your religion to do it, this is the way to dig ourselves out of it.

As we discipline ourselves to show up, to save, to invest wisely, and to modify our behaviour, everything changes.

None of these changes come from the audit itself. They come from widening the space between impulse and action, from noticing sooner, and from interrupting behaviour before it plays out.

If you’re still reading this, thanks for staying with me.

I’ll write a little lighter next time, I promise.