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Not Saving? Not Your Fault - Blame Auto-Pilot Money Habits

Posted by Carrie Rattle on Oct 27, 2015 8:00:00 AM

In our last two blogs we talked about a Nobel Laureate's proof that we have emotion in all our money decisions, and our ingrained attitudes toward money developed over time.  In addition, we also have auto-pilot behaviors.  Auto-pilot behaviors are handy because they help you minimize energy needed to get through the day.  You probably have at least 50 anchor behaviors a day, such as brushing your teeth, showering, and getting to work. The good news is that most of these can be accomplished without coffee since they are such a routine part of our day.  The bad news is that we often don’t realize we’re doing them.

If you take a stab at writing down 50 auto-pilot habits you do in a day – it will take you more than one sitting because they’re so habitual. Guaranteed.

The Good and the Bad of Auto-pilot Money Behaviors

Behavioral Cents Auto Pilot BehaviorsThe bad news of course, is that auto-pilot bad money behaviors also get repeated without catching them. How many times have you signed a credit card receipt without verifying the total, and then left it in the shopping bag rather than keeping it for tracking? How many times have you taken money out of the ATM, but couldn’t reconcile what you spent it on?

Auto-Excuses

Along with auto-pilot behaviors, there are also auto-pilot excuses. How many times have you or your friends said “We don’t have to worry about money. We’re on vacation.”  And how many times have you then been surprised at how high the post-vacation bill was?  It’s probably happened to most of us at one time or another. The same excuse works well for the Holidays, a special Birthday, and your kids. 

Catching Behaviors

It’s not difficult to analyze your auto spending behaviors with a bit of tracking. It’s also helpful to enlist the aid of close friends who are often with you.

  1. WHAT do you spend your money on? Record your expenses in simple buckets such as Household, Toiletries, Food, Entertainment, Gifts. You get the idea.
  2. WHEN did you spend your money? Chart days and times.
  3. WHEN did you spend MORE money than you thought – after a bad week/day? When your friends spend?
  4. HOW much was spent on needs versus wants?

Related Topic: 4 Steps to Better Money Habits What are My Money Habits?

Information shown is for illustrative purposes only and is not intended as investment, legal or tax planning advice. Please consult a financial adviser, attorney or tax specialist for advice specific to your financial situation. Behavioral Cents, LLC and any third parties listed, linked to or otherwise appearing in this message are separate and unaffiliated and are not responsible for each other’s products, services or policies. 

Carrie Rattle is Founder of BehavioralCents.com. She helps smart women build money confidence by observing their behaviors with money, and then changing them for the better. Women are then empowered to make wise money decisions.

 As a veteran of Financial Services, she sees a significant gap where too few are focused on helping people with their actual money behaviors instead of simply telling them what they should do. Thoughts always welcome: carrierattle@behavioralcents.com.

 

 

Topics: Money Habits

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