If you’ve been reading my blog for any length of time, you can tell that I have quite a wide range of interests. I’m passionate about leadership, investing and finance, endurance running, nutrition...lots of different things. I don’t see this as a hodge-podge, but rather as a holistic set of interests that leverage and influence on another.
You see, I believe that the strengths and principles found in one discipline can influence and grow another.
Too many times we disconnect our areas of interest and expertise from one another when, in fact, our experience in one can benefit others.
Two of the areas that, at first glance, seem disconnected are health and wellness and personal finance. Personal finance is one of the areas that people seem to struggle in with no measure of inconsistency. For many, it seems that you either have a gift for money management or you just don't.
However, we know that you can learn to manage your money and succeed financially. You can take knowledge and principles and apply them to reap a fruitful financial life. What I see in my own life are parallels in my personal fitness and health journey and that of a financial wellness journey.
So today, I'm imparting to you how principles that everyone picks up in the discipline of health, wellness, and exercise can be applied to money management.
How to Apply 4 Principles of Health and Wellness to Money Management
1) Make small changes for long-term benefits.
When you decide to make a healthy lifestyle change, you don't usually jump in and change everything all at once. At least, you don't do so and typically find much success. When it comes to exercise changes, eating habits, or other wellness routines, we typically have to take things in small steps, one-by-one. This ensures that we are able to keep up with the changes and form habits without becoming overwhelmed or feeling as though we are depriving ourselves.
Lasting change happens slowly and in small steps, over time. It doesn't happen in crash diets or on impulse. So what about in our finances?
When we think about what makes a long-term, positive financial impact, we have to look at small, slow changes. This applies to both our money habits and our financial decisions.
Where money management is concerned, replacing bad habits can be a slow process. If you try to throw out every bad impulse all at once, you may relapse when you begin to feel deprived, or feel overwhelmed by the weight of trying to fix all of your debts or money mistakes all at once. Take things one step at a time.
When it comes to financial decisions, look for steady, reliable investments with long-term yields. Getting rich quick is always too good to be true.
2) Work on yourself where you are right now.
We have a habit of comparison in just about every area of life. If your buddy has been running for longer than you have, you still expect to be able to keep up with his pace during the marathon even though you just started in the last year. He has more experience. He's made more mistakes, has had more time to train, has more races under his belt, and has his body in better shape.
But still, we set unrealistic expectations for ourselves. Whether physically, mentally, or financially, it is critical to meet yourself where you are. To do anything else is to set yourself up for failure. You take on too much risk to sell an image of yourself or your finances that simply doesn't exist.
Don't make comparisons to an investor who has been in the game for twenty years, or the guy who started out with $100,000 compared to your $50,000. Be where you are and be realistic about your circumstances.
3) Develop good habits and cut the bad.
Part of the road to a healthy life is about habit. These are the things that take very little effort to do because they come so naturally to us through a routine. In health and wellness, this may be what we eat and don't eat, going to the gym, taking a run every day, or even taking time for yourself to journal or otherwise mentally decompress.
But what about financial habits? Budgeting and sticking to it. Avoiding impulsive purchases. Loading your coupons up to your smartphone before you shop. There are plenty of good habits to form in the world of finance.
There are also bad habits we can have in both of these areas. Satisfying our sweet tooth whenever it hits or stopping for a fancy coffee every morning even though you really don't need the whipped cream tend not to serve the waistline well. Financially, it could be a habit of pulling out your credit card and spending what you don't really have or obsessing over the stock market and stressing yourself out.
The important thing to remember is to pick up the good habits and ditch the bad.
4) Be aware of both your strengths and weaknesses.
Self-awareness is a key part of what researchers call the dimensions of wellness. We can change our habits and behavior much more readily if we can understand and recognize what it is we do or fail to do and why. This introspection is valuable in all areas of life, whether it's internal as in your health, or external, in your money, or in your job.
Knowing, for example, that you are a “morning person” can help you find your hours of peak productivity.
In finance, understand your inherent strengths with money and what motivates you can be a game changer in cultivating financial wellness. In the same way, recognizing your weaknesses pushes you to directly address them, whether the solution is in finding outside help or simply employing personal risk management strategies.
What’s the best piece of financial advice you’ve ever put into practice? Share it in the comments.