How to Make a New Money Habit Stick- S2E2

Ever wonder why good money habits don’t stick, no matter how much you want them to? In this episode of The Rhythm of Money, you'll learn the tiny step that actually recalibrates your inner compass around money to naturally point toward getting more of what you want: the Micro Habit. 

A small financial action creates evidence. That evidence changes what you expect from yourself, until you're no longer just "trying" to save or invest; you’ve become someone who naturally does those things.

Indigo Dutton, retired investment advisor and author of Micro Habits for Major Happiness, adapts her method specifically for your financial life. You’ll learn how to:

• Choose actions small enough to avoid resistance.
• Make your financial habits precise.
• Attach them to reliable moments in your week.
• Build a lasting pattern of follow-through.

Note Before You Begin: This builds on the goal we identified in S2E1 Even if you don't have a plan yet, bring one change you’ve been wanting to make.

What’s one Micro Habit you could repeat this week? Share it and this episode with a woman in your life, and let's support each other!

Follow for weekly episodes on money behavior, practical saving, investing, and retirement.

Get the free Deep Receiving recording and reminders at TheRhythmofMoney.com.

No financial advice is offered or implied. For guidance specific to your situation, consult a licensed financial professional. 

Transcript

SPEAKER_00 0:02

Welcome back to the rhythm of money. If you've ever promised yourself you'd track your investments regularly, or organize financial paperwork as it came in, or you would make an extra debt payment each month, something you've already decided would be good for you financially, only to watch the habit quietly disappear. This episode is about why that happens and what makes a new pattern last. Why is it so hard to make good money habits stick? And how do we change that? Good money habits usually don't fall apart because you didn't want the result enough or because you lack discipline. They fall apart because we have the wrong approach to making them last. We aim at the big leaps and dismiss the tiny steps that count the most. Today I'm going to show you what changes that. It's small enough to repeat without fighting yourself, but powerful enough to begin changing what you expect from yourself and how you naturally behave with money. We've spoken many times about recalibrating one's inner compass around success. This week you'll learn the most powerful technique for doing exactly that. Now, last week you answered three questions about your money. What do you want it to make possible? Why does that matter to you? And what are you willing to sacrifice, postpone, or change now to get there? This week we move into something harder than naming what you want. We look at why knowing what you want still isn't enough to make you act differently, and what it actually takes to close that gap. I'm Indigo Dutton, retired investment advisor and former business consultant and psychotherapist. For decades, I worked with people building change that was meant to last, including using a method I eventually wrote an entire book to teach. You'll hear pieces of that method today, adapted specifically for succeeding with money. This isn't a condensed version of the book. Think of it as more of just the method retooled for the work we're doing together here. If you're new, this episode holds up fine on its own. Season one is their afterward if you want the somatic foundation beneath it. Here is the core question of today's episode. If wanting something clearly were enough to make you act on it, none of us would still be stuck anywhere in our lives. So why isn't wanting it intensely enough to get us to do it consistently? Let's begin with two things people commonly rely on when they are trying to change. Willpower is the mental energy you spend forcing yourself to do something you don't want to do in the moment. You may want the eventual result, you may care deeply about having the savings, owning the home, understanding your investments, or feeling more capable with money. But right now, in this moment, you'd rather avoid the account, put off the decision, spend the money, or tell yourself you'll begin next week. Willpower is what you use to override that immediate preference. It can help you begin. It can carry you through an occasional difficult moment, but it takes energy, and you have less access to it when you're tired, stressed, distracted, disappointed, or already carrying too much. Motivation works differently. Motivation is the excitement you build around a goal. You imagine the new home. You calculate what the retirement account could become. You buy a planner, download an app, make a detailed plan, and feel the energy of beginning again. That energy is real, but it changes. Eventually the goal is no longer new. The result is still far away. The planner begins to feel like another obligation, and the app becomes one more notification to ignore. Neither willpower nor motivation was built to carry you reliably for months or years. The more durable change begins elsewhere. It begins when you gather enough evidence to expect something different from yourself. At first, you may be a woman trying to save money every Friday. Each time you actually do it, you confirm something. You confirm that you can decide to save and then follow through. You confirm that saving is an action available to you. You confirm that this isn't merely something you wish you did. It's something you have now done. One completion may not change much, but then you do it again and again. Eventually, you're no longer simply trying to become better at saving. You begin to see yourself as a saver. Once that expectation becomes established, the action no longer requires the same argument. Saving is simply something a saver does. That's what we're beginning to build today, whether it's saving, investing, financial resilience, strategy, or something else. And we're going to begin with something almost embarrassingly small. You already know the opposite pattern in your life, even if you've never named it. The spending plan you were going to follow exactly starting Monday. The investing account you were finally going to seriously fund and get fully invested, this time for real. The savings goal that started strong for a couple of weeks and then quietly stopped. The financial app you set up, organized, and used intensely for one weekend before abandoning it completely. Those plans didn't necessarily fail because you didn't care enough. They often failed because the first step was sized for the version of you who already had the habit, instead of the version of you who was just beginning to build one. Here's the piece from my method that matters most for this. Your mind, underneath the thinking part, doesn't like being told that you've been living your life entirely wrong. You may consciously think, I'm going to improve my financial life. But another part of you may hear, everything you've been doing is wrong. And starting tomorrow, you have to become a completely different person. Little miss. Ask yourself for a dramatic overhaul, and some part of you may resist, stall, forget, become distracted, or find another reason you aren't quite ready. Usually, this doesn't feel like a conscious decision to sabotage yourself. The plan simply becomes harder to approach. It's related to the flinch you learned to recognize last season in episode 5. A large demand can register as pressure or threat, but a sufficiently small action may pass through without creating the same resistance. So the actual skill isn't willing yourself into bigger action. It's finding a step so small that no part of you needs to object to it. I call that step a microhabit. The book I wrote to teach the full method is called Microhabits for Major Happiness. It applies the approach to several areas of life. Here we're concentrating on how to use it with money. When I say micro, I don't simply mean a modest goal. A microhabit isn't your regular goal reduced by 20%. It isn't the smallest amount that still looks impressive enough to count as meaningful progress. It may be far too small to produce the financial result by itself. That's intentional. Its first job is to get you into motion without creating enough resistance to stop you. Its second job is to give you repeated evidence about who you are becoming. Let's make this concrete with the goal you named last week. Suppose your goal was saving toward a home. The version that commonly fails is deciding you'll suddenly set aside $500 a month starting this month. Whether or not your current cash flow can comfortably hold that. Your microhabit might be moving $7 into a separate account every Friday. Not hundreds, $7. Performed manually, not on auto invest, on a schedule you can keep. Suppose your goal was building your retirement account. The version that fails is blocking off an entire evening to create a complete investment strategy before you've even signed into the account in the last year. Your microhabit might be logging in once a week and remaining there for 10 seconds, whatever you happen to decide to look at once you're there, and then log out. You don't have to trade anything, you don't have to choose an investment, you don't have to evaluate everything you already own or the performance. You're building the habit of making contact with the account on a regular basis. I actually check my accounts twice a week. Suppose you want to understand where your money is going. The version that fails might be promising yourself you'll categorize every transaction from the past six months and then stay on top of every single one going forward. Your microhabit might be opening your checking or credit card app after breakfast on Saturday and identifying one purchase from the previous week and what category it was in. One purchase. You can do more if and when you naturally want to do more, but one is the commitment. The commitment needs to be small enough that you can complete it even during a stressful, busy week. A microhabit also needs to be precise. You know, work on my finances is too vague. You can spend an hour thinking about working on your finances and still not have a single clear point at which the task is complete. Transfer $7 every Friday can be finished. Open my retirement account and remain there for 10 seconds before logging out can be finished. Identify the category for one purchase from last week can be finished. Your mind needs to recognize success. That becomes much harder when the assignment has no clear edges. The habit also needs a place in your actual life. Decide when you'll do it. Attach it to something that already happens reliably. Wednesday morning when you sit down to your desk, the first Sunday of each month after breakfast. You know, something specific and repeat it like that. And choose a simple way to record that you completed it. A check mark on a calendar is enough. So as a mark in a notebook or completing a returning task on your phone app, the record isn't there to monitor you. It just allows you to see the evidence accumulating. Bring to mind the goal you named for yourself last week, which whichever one felt most alive to you. If you weren't here last week, just something you've known you want for yourself financially. Now shrink it. Don't shrink it into something that seems like respectable progress. Shrink it into something almost too small to count as even trying. Like, say for example, you to move away from money. But let's say you want it to be able to run a marathon, okay? All right, so that gets shrunk down to when you go to collect your mail each day. If the mailbox is right at your door, you walk all the way out to the street anyway. Or if your mailbox is at the street, you collect it, but then you walk all the way to the corner before you turn back, right? So we're we're just this is not a marathon. It's not, you're not making genuine progress at preparing for a marathon, but you are making a tiny act in the general direction of going further, right? The tiniest possible act you can think of that's in the general direction of doing the thing you're trying to do. Then make it exact. What will you do? So say walk to the corner when you collect the mail. When will you do it? So say six days a week when you collect the mail. How will you know it's complete? Well, in this scenario, you know, either you're at the corner or you're not. And where will you record that you did it? So again, this can be whatever is easiest for you, whether it's paper or a task management app, you know, whatever you like. Now, you may be thinking that $7 a week isn't going to buy a house. 10 seconds inside an account isn't going to fund a retirement. Identifying one purchase isn't going to transform your budget. And you'd be right. If the immediate purpose were the $7, the 10 seconds or the single purchase, it isn't. Hold on to that thought. I'll come back to it. But here's what repetition actually builds. Every time you complete the tiny action you said you would complete, you're doing more than moving money or opening an account. You're creating evidence. You're demonstrating that you can make a precise financial commitment and follow through on it consistently. Your intellect can tell you all day that you're capable. Repeated experience carries a different kind of authority. One completed action becomes a fact. Then you complete it again. And again. The evidence begins to change what you expect from yourself. At first, you hope you'll save on Friday. Later, you assume you'll save on Friday because that's what you do. At first, opening the retirement account feels foreign and uncomfortable. Later, maintaining contact with it becomes just normal. At first, paying attention to your spending patterns feels like a major project that you're attempting. Later, it begins to feel like part of the way you make decisions in your financial life. In all these cases, you aren't endlessly trying to persuade yourself to behave differently. You're confirming what you've begun to understand about yourself. You're a woman who saves. You're a woman who maintains contact with her accounts. You're a woman who pays attention to where her money goes. And when that expectation becomes familiar, the behavior that fits it begins to feel more natural. This connects directly to the land trust families I told you about last week. Some had stopped believing that a home was realistically available to them. Their spending reflected the expectation that there was nothing meaningful to prepare for. Others imagined that qualifying would require so much that they hadn't really begun preparing yet when the real opportunity arrived. Both groups needed something more substantial than desire and more accurate than assumptions. They needed a felt sense that the possibility was real and that they were capable of meeting it. That understanding had to be supported by actual evidence. The tiny repeatable step begins providing that evidence. It doesn't produce the final outcome immediately. It gives you confirmation that you're becoming the person whose ordinary behavior supports that outcome. Then not only does your unconscious stop sabotaging you, but it starts maneuvering in invisible ways to create the conditions that fit that person's life. But first, you need the confirmation that you are indeed that person. And this confirmation doesn't disappear when the original excitement of starting something new fades. Instead, it accumulates. Now, maybe this is sounding good to you, but you're already bracing for the moment your attempt fails. You know the moment. A Friday gets busy. The transfer doesn't happen. By Tuesday, you've quietly decided that the whole plan was foolish and returned to having no plan at all. I want to make sure that doesn't happen to you this time. Missing a single Friday doesn't undo anything. The plan was never about protecting a perfect streak. It was about completing something precise and repeatable often enough to establish a new pattern. Miss one Friday? Following Friday, go back to doing it again. You don't double the transfer, punish yourself. You don't create a more elaborate plan. You don't spend the week deciding what the missed action reveals about your character. You resume. That's the entire repair. Now, if you repeatedly avoid the action, look first at the size of the action and where you placed it. Perhaps $7 creates more resistance than you expected. Make it $1. Perhaps Friday afternoon is chaotic. Attach it to a more reliable moment. Perhaps logging into the account brings up more than 10 seconds can comfortably contain. Make the microhabit opening the bookmarked login page without signing in. There's no floor, too low to begin from. One dollar is enough when the immediate purpose is establishing that you're someone who sets money aside. Opening the login page is enough when the immediate purpose is establishing that you're someone who approaches her financial accounts regularly. The smallest action you'll repeat has more power than the impressive plan you continually avoid. There's another important part of this. When you have an energetic day and do more, allow the extra action to remain extra. Don't immediately raise the minimum. If your commitment is to categorize one purchase and you naturally get to doing 15 before you want to stop, that's fine. But next Saturday, the microhabit is still one purchase getting categorized. If your commitment is to transfer $7 and one week you decide to transfer $50, the following Friday's commitment is still seven. The microhabit is the floor. Keeping the floor low preserves the action you can complete when the week is difficult. It also leaves room for the behavior to expand naturally as your expectation of yourself simply changes. Eventually, $7 may begin to feel unnecessarily small. You may notice that you want to transform more and often are finding yourself doing it. You may begin looking forward to seeing the account grow. You may adjust other spending because saving has become something you expect yourself to do. The larger behavior starts fitting you because your understanding of yourself has changed. That development is very different from repeatedly forcing a larger demand onto a person who still expects herself to not follow through. So, back to what $7 or 10 seconds actually builds. It doesn't build the entire house fund or a retirement account, at least not yet. It builds a version of you who has direct, repeated proof that she does what she says she'll do with money. At first, you're practicing an act. Then you're gathering evidence. The evidence changes your expectation, and the expectation begins shaping the actions that feel normal for you. You don't have to wake up every Friday and reinvent the decision to save that afternoon. You save because you've come to understand yourself as a saver. You don't have to mount a new campaign every time you approach your retirement account. You approach it because maintaining contact with your financial life is something you now do. You're no longer waiting to become a different person for acting differently. The repeated action is how that person becomes believable to you. Which brings us back to where we started. Why isn't wanting something intensely enough to make you act on it? Because wanting can remain entirely within your thoughts and feelings. Lasting behavior needs to become consistent with what you expect from yourself within your belief. The tiny action begins that process. Its smallness allows you to act without creating overwhelming resistance. Its precision allows you to know that you succeeded. Its repetition creates evidence. And the evidence gradually changes who you understand yourself to be. Now, whatever you shrank your goal down to a few minutes ago, that's your assignment this week. Write down the exact action. Decide when you'll do it. Choose where you'll record its completion. Then protect its smallness long enough for the evidence to accumulate. Now I've put a question if you're on YouTube watching this, it's in the comments. If you're on Spotify or Apple or something like that, I don't know that I can put a comment there for you. But if you know me, you can always text me. So here's my question. What microhabit are you choosing for your financial life this week? And when will you do it? Naming it clearly may help you make it real. You may also give another woman an idea for a first step she hadn't considered. And follow the show so that next week's episode arrives and you don't have to go looking for it. And you can also subscribe for email reminders and receive the free deep receiving attunement recording that I love myself. I listen I actually listen to it every single day. But it's a gift for you uh for to use once a week. And you can get that at therhythmofmoney.com. So thermofmoney.com. And this is the rhythm of money. And you are living your true note in this very moment.