I am blogging on behalf of Visa Prepaid and received compensation for my time from Visa for sharing my views in this post, but the views expressed here are solely mine, not Visa’s. Discover more at http://www.VisaPrepaid.com or view more Visa Prepaid videos at http://www.youtube.com/
Everyone is busier than ever. No matter what your job it seems instead of working smarter, we’re working harder. Much of this has to do with the basics. We need money to pay our bills, buy food, keep a roof over our heads. However, there are economic issues that make finding and keeping a job tougher than in the past. More and more people are struggling with making ends meet, but we all know our small decisions affect our finances. It seems we live more in the ‘now’ than ever before, but there’s a concept that explains why we may be making not so smart choices when it comes to our money.
Decision Fatigue is a fascinating concept. According to recent studies by social psychologist Roy F. Baumeister no matter who we are, or what our circumstance, we are limited to making an exhaustive amount of decisions each day.
“Willpower turned out to be more than a folk concept or a metaphor. It really was a form of mental energy that could be exhausted. The experiments confirmed the 19th-century notion of willpower being like a muscle that was fatigued with use, a force that could be conserved by avoiding temptation.” {from the NYTimes}
It’s easy for us to recognize decision fatigue when it relates to things like indulging in dessert. Like seeing our waistline grow as we indulge in dessert after an internal debate, our finances can be greatly affected by decision fatigue. In the short-term it means less debt reduction, less savings, and less to invest. In the long-term it could mean our financial goals become impossible to reach because of our decision fatigue. When applied to personal finance it’s easy to see that the more you place yourself in the path of choice temptation is harder and harder to resist.
All you have to do is look in the aisle of a grocery store to know why it’s so hard to resist those end caps. They stock them with items (placed at a premium I might add) to get you to pick up things that aren’t on your list because they are a ‘good deal’ or something you ‘just have to try.’ {Both things I heard on my last shopping trip!}
Finding ways to manage your financial decisions quickly and simply will help you make smarter decisions. Here are some ways I’ve found to help make money management quicker and to keep your willpower in check for important decisions like whether to watch Real Housewives or not. 😉
9 Easy Ways to Manage Your Money and Avoid Decision Fatigue
1. Set aside time.
Choose the morning whenever possible, particularly on a weekend day, or a day you know your work load will be lighter. Use this time to work on your budget, reconcile accounts, and pay bills in the morning once a week, or once every other week. Make it a set appointment, but if you need to ‘reschedule’ add a reminder to your calendar or to do list. If you have a spouse/partner you need to set aside a monthly time to meet about joint accounts, or to share a ‘monthly report’ if you divvy up who manages the finances.
2. Automate whenever possible.
If you can automate all your bills, do it! If you’re concerned about mistakes or overages, use your weekly check in time to make sure everything is as it should be. A simple way to access your money is to set up direct despots to a prepaid card. You can use it for all your spending money, or even use it to set up an adult ‘allowance’ (see #3) where a portion of your check would go directly to your card.
To learn more about VISA’s Pprepaid option card and direct deposit watch the video below or click here if you can’t view the video.
Additionally, go paperless whenever possible. You’ll avoid losing important bills and cut down on clutter and waste.
3. Make sure to have some ‘impulse’ money.
It can’t all be boring and heartless decision making. Sometimes we just really want that gossip mag or that $3.50 latte. Set up ‘fun money’ accounts for older kids and each partner/spouse in your family.
4. Outsource the tough stuff.
Let’s face it we can’t all be numbers people. Hate taxes? Hire a CPA. Need advice on meeting your goals? Consider hiring a financial planner or advisor. Looking for advice on a budget? Read books or blogs.
5. Shop smart.
Shop with a list, don’t go into stores to ‘browse’, and unsubscribe from emails and catalogs to avoid spending on things you don’t need. You can also use coupons and discounts to stretch your dollar even further.
6. Keep a running list of items you need.
This goes handing hand with smart shopping, but you need a list of all the small and big purchases you see in the near future. We keep a running list like this in our house and it includes everything from new socks to a new kitchen. I prefer to include categories and estimates of cost, but you may come up with a system that works better for you.
7. Track the ‘big picture’ stuff, but not too often.
If there’s ever a way to motivate yourself to make better choices it is seeing your goals become reality. Watching your debt going down each month, your net worth growing, and your dreams getting closer can be the best way to stay on track. You can use a spreadsheet, a graph, or a something to symbolize your goals, but don’t check in too often. Once a month is generally a good idea.
8. App it up.
If you’re on the go (like most of us are these days) having apps for your credit cards, bank, and other accounts on your phone can save you time and hassle. I also keep all the company phone numbers in my contacts, and have access to a password-protected document that includes any information I might need on the go.
9. Keep your financial ‘to-do’ list simple.
While it would be nice for us to remodel ourt house from top to bottom, meet all our savings goals, afford extras for our family, and all the other things we desire tomorrow, it’s not realistic to expect everything on your financial to-do list to get done quickly or magically! Well, maybe if you win the lottery. 😉 Keeping your focus on what you need to do right now makes it easier to manage. Breaking down larger goals into smaller ones is smart financially and will keep you from getting overwhelmed.
What are some ways you manage your money that are quick and easy?
Kelly
Disclosure: I am blogging on behalf of Visa Prepaid and received compensation for my time from Visa for sharing my views in this post, but the views expressed here are solely mine, not Visa’s. Discover more at http://www.VisaPrepaid.com or view more Visa Prepaid videos at http://www.youtube.com/
We are working on this. We have started setting aside time every other week when the paycheck is deposited to plan things out. And even though I struggle with “impulse money” because I think every penny should go to bills. I see the wisdom of it and am starting to not feel so stingy or guilty. Great tips!
I probably need to print this out or tattoo it to my arm or something. I’m not so good at financial planning, as hubby would tell you 🙂
Great planning advice!!!
Great advice. Planning is so important.
Great advice. It’s always helpful to have a big outlook on the financial picture at home.