So we all know the path to creating wealth is to spend less money than we earn, correct? We also know that to control our weight we must consume less calories than we expend. So, if the solution is so simple why do so many of us struggle?
We struggle because we have failed to conquer the behavioral traps that trip us up.
Does this sound familiar? You wake up in the morning, jump on the scale in the bathroom, look at the number and immediately feel disheartened. You get to work and check your bank balance only to find that a payment you weren't expecting got pulled from your bank account and now you aren't quite sure how you're going to make it to the end of the month on your remaining account balance. Your boss comes in to your office and drops extra work on your desk and now you're starting to feel the stress.
So what do you do?
Lunch break rolls around and you head straight for the nearest fast food restaurant and get a big delicious burger. Or maybe you jump online and buy yourself a new outfit, something you'll look great in. That will make you feel better, right?
The answer is yes, it will, and therein lies the real problem. What was CAUSING you stress? You were stressing out about your finances and your weight. How did you solve it? By going to buy a hamburger or making an impulsive purchase.
Fast forward a few hours or maybe a day, now the good feelings you got from making that impulsive decision have worn off and now you feel guilty, guilty for spending money you didn't have and eating calories you didn't need.
The effect is a continual compounding of stress that grows and continues to weigh us down. It continues to push us further away from our goals and aspirations.
I truly believe that if we can learn to work with our behaviors we can gain control over our futures and permanently decrease our stress levels.
Enter behavioral finance. If we can work through the behaviors that are limiting our success, we can find the money to put our financial goals on track.
This isn't an overnight process, it takes commitment. But with the proper advisor, who's willing to work with you on what's holding you back you can truly achieve success.
Dean Chapman is a financial planner with an affinity for business.