On Monday, I offered up my first thoughts on financial independence and that it requires sacrifice. It’s partly due to my own frustrations with debt repayment, the slow and somewhat seemingly tedious manner of it all. The desire to get back out on my own is very strong and there are many things I want to do with my life that debt freedom will allow me to do. Financial Independence, like many things in life, requires the right environment to prosper.
I read a great post by Leo Babuta at Zenhabits about “Living the Quiet Life” earlier this week that applies to this situation. I am a huge supporter of the Digital Detox and minimising social media interactions – call it the less is more, work smarter-not-harder philosophy. He speaks to the “addictiveness” of our social interactions and how our quiet time has become almost non-existent.
How does this apply to our finances?
In our day-to-day goings on, we can easily overwhelm ourselves with excessive online socializing, texting, conference calls in the car and general running around. Quite often, I find myself checking my finances several times a day, which is utterly ridiculous. The Big Banks don’t pay interest, so it’s not as if my money is going to multiply magically like lemmings. Why do I do it?
That’s a Michellism…Wikipedia; please feel free to add it to your database.
Remember Pavlov’s theory of classical conditioning from high school? [quote style=”boxed”]Pavlov presented dogs with a ringing bell followed by food. The food elicited salivation (UR), and after repeated bell-food pairings, the bell also caused the dogs to salivate. In this experiment, the unconditioned stimulus is the dog food as it produces an unconditioned response, saliva. The conditioned stimulus is the ringing bell and it produces a conditioned response of the dogs producing saliva.[/quote]
The same theory applies to your finances. We have conditioned ourselves so drastically with technology that we either love or hate the chiming of our smartphones; causing a conditional stimulus. Just like the dog salivating when it hears the bell.
In this case, the conditional stimulus is checking our social network status, the stocks in our portfolio, reading the latest financial news. Chime or not, we have conditioned ourselves like clockwork to repeatedly check our finances! Before you know it, you have checked your finances numerous times a day, therefore creating extra anxiety in your life. You start to look at your portfolio/finances in the minutae and irresponsibly forget about the long term. If you’re a day trader, stop reading here and enjoy your anxiety. For those who would like a happy life and financial independence, keep reading.
Think back to the last time you were on vacation and tried to turn off your smartphone, how did that go? I’m sure it was like being weaned off cocaine or having your right arm savagely removed from you. You didn’t know what to do with your time, you were undeniably lost.
We have become so accustomed to technological conditioning that when it’s removed from our lives, we suffer withdrawal. We become fidgets, misfits with no direction, social interaction becomes difficult because our normal interactions are centred on what we have tweeted, pinned, or the latest stocks we’re watching.
Untrain your brain: reducing technology from our finances
It’s to your advantage to untrain your brain when it comes to technology and your finances. Remove those nervous triggers that cause you to develop OCD and control freak habits about your money.
Leo offers suggestions on having a quiet life in his article, how about quiet finances? Stick with me here. I am not suggesting you turn off your portfolio or finances completely, I’m merely offering a new perspective. Tone down your interaction with your finances and money and turn down the anxiety. Happiness abounds!
Create the right Financial Environment
A few suggestions for creating the right environment for financial independence:
- Declutter your finances! No, not put all your eggs in one basket, just make it easier to work with your money. Create a system and make it easy for yourself.
- Make peace with your portfolio and finances. Know you’re in it for the long term, worry and anxiety are not needed.
- Schedule time for your finances. Download your transactions once a week instead of once a day like I do. Yikes!
- When you feel the need to check your finances, stop yourself and remember it is scheduled for another day. Clear your thoughts.
- Make it automatic. This isn’t new by any means, many financial gurus offer this wisdom. The more automatic your finances are, the less you have to check in on them. Make “Pay yourself first” automatic on each pay. Have your bills auto withdrawal. Set reminders if you go over a budget amount and ensure they are not too frequent. Choose the right investments and only check your portfolio once a year.
- Financial Thought Innovation. Take a day each month to think of your finances in an innovative way. Change the negative “I’m in so much debt” thought pattern and find positive ways to think about your money and getting to a debt free life.
Undeniably, I believe that we are bored with our financial existence, so we create our own demise through debt. There are no great wars to survive, no great depression to starve the world, no technological apocalypse; the only Great War is the one in our minds. We fight the war on financial independence. Fearlessly, we fight towards debt freedom and financial independence, once there; we don’t know what to do. Did we really want this? Even though the financial battle has ended, for many, they go back into debt. It is our greatest achievement not to. Just as you shouldn’t fear death, do not fear financial independence. What’s on the other side for both is very rewarding.
To stay free, we must change the battle we fight, recondition our thoughts towards financial independence. The change must come in the form of financial thought innovation; change the condition from achieving debt freedom to a condition of dreaming the dream every day, keeping your financial independence and never relinquishing it to anyone or any materialistic moment.
Flex your financial muscle, fight the good fight, achieve financial freedom and find victory in financial thought innovation.