Guest blog by Anna Miller of SmartAsset.com
It is more than common knowledge by now that it is much easier to get in debt than out and way easier to put on pounds than to take them off. Sheer will in these cases works for a very rare and lucky few, but for the rest of us, losing weight and beginning to eat healthy or getting out of debt and learning good finance habits takes a lot more. It is difficult and takes determination and dedication, but you shouldn’t be surprised to hear that planning based on the long-term effects of decisions makes more sense for both.
Why Cold Turkey Just Doesn’t Work
As much as cold turkey is a great idea in theory—who doesn’t want to turn things around and bask in the instant gratification of a total transition for the better? —in practice this rarely works. Telling yourself you are going to wake up tomorrow and stop all unnecessary spending and never eat another chocolate croissant again might work for a week, or maybe even two…
But then you get stuck at an airport, you are delayed for four hours, you forgot to pack a healthy snack and you’re starving. A case of pastries is staring you down, you are bored stiff and decide to shop a little in the duty free stores, and before you know it, you have splurged! You are off the bandwagon, you have eaten two chocolate croissants that tasted so good alongside a double mocha with extra whipped cream and you spent way too much on that cashmere sweater. After the sugar rush, the guilt sets in and if you are like me you might even feel defeated. Why not have another pastry? And now that you have spent so much, what difference does it make if you buy that giant glossy coffee table book about your favorite artist? Despite your noble plans, the downward spiral begins.
Long-term Planning: Starting Small
Quick fix diets can have disastrous effects, and complete deprivation in both food and finance usually ends with splurging and then guilt. In the same way that smart planning can help you eat better, careful budgeting can help you know how much you can afford to spend. If you invest time and planning into these things, success is so much more likely. You can’t expect to just flip a switch when what you are trying to do is build a healthier lifestyle.
To incorporate a long-term plan into your life, you need to anticipate the need to give yourself encouragement along the way, and this is
particularly true for getting out of debt. The most conventional recommendation for getting out of serious debt is to start with the debt that carries the highest interest. This could be really daunting though, and might be too much to stomach all at once. Luckily, there is a competing suggestion called the debt-snowball method. The idea here is to start with your smallest debt and work your way up. Eliminating a small debt is still eliminating a debt, and this feels really good. The idea is to take this positive feeling and channel it into momentum as you tackle the larger debts. It also helps you to develop the habit of paying off debts consistently by starting small.
The same can be true with dieting. Starting small is a lot less intimidating. There are a bunch of little tricks you can use that can help you to start making better choices with your eating. My personal favorite is the twelve almond trick. If you eat twelve almonds about twenty minutes before a meal, it takes the edge off your hunger and makes it much less likely that you will overeat. I carry an emergency stash with me just in case I get stranded in an airport. And of course you already know this one, but NEVER, ever shop for groceries when you’re hungry!
New Frontiers in Financial Planning
The cool thing is, people seem to be catching on to the idea of planning and lifestyle changes in the personal finance world. At SmartAsset.com, we are building a tool that takes the idea and importance of long-term planning seriously. We have built a free app that allows you to set evaluate your (BIG) decisions and see how they will affect your finances in the future. We think that starting small, building momentum and remembering to celebrate the small successes will lead you to better places in your health and finances.
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