To get started on getting your personal finances in order AND stick with it, one important thing you can do is change how you think about the process.

There are two different ways that people can think about the things they need to do or want to do in their lives. These tasks can be thought of in a concrete manner or abstract manner. Let’s take drinking a cup of coffee as an example. Concrete thinking related to this task focuses on what you are doing when drinking the coffee while abstract thinking focuses on why you are engaging in this activity. The following table illustrates some concrete thoughts and abstract thoughts related to drinking coffee:

Concrete Thoughts (What I’m Doing)

  • “I am raising the mug to my lips.”
  • “I am slightly tilting the mug.”
  • “I am swallowing the hot liquid.”

Abstract Thoughts (Why I’m Doing It)

  • “I am giving myself a boost of energy.”
  • “I believe that coffee is rich in antioxidants and drinking it in moderation is good for my health.”
  • “I am having a cup of coffee with a friend who needs my support right now.”

In her book Succeed (clickable link) Easton, PA author Heidi Grant Halvorson tells readers that a great motivator for people to succeed at making positive changes in their lives is to remain focused on why they are doing things rather than just on what they are doing. Let’s look at that in a financial planning context:

Concrete Thoughts (What I’m Doing)

  • “I want to save up some money so that I have an emergency fund.”
  • “I want to buy insurance.”
  • “I want to save money for retirement.”
  • “I want to put away some money for college for my kids.”

Abstract Thoughts (Why I’m Doing It)

  • “I want to be prepared for unexpected expenses so that my long-term savings goals aren’t disrupted.”
  • “I want to protect myself and my family from risks that could really hurt us financially.”
  • “I want more flexibility to pursue a second career that I’ll find more fulfilling”
  • OR
  • “I want more time to travel and pursue my hobbies and interests.”
  • “I want more time to travel and pursue my hobbies and interests.”
  • “I want to make sure my children have every opportunity to succeed in life.”

Staying focused on these higher order benefits that you can gain from working with a financial advisor makes it much more likely you’ll follow through on many of these things. It is also a great mechanism for you to sort through who we are and what you’d like to get out of your life.

With all of that said, abstract thinking is not appropriate in every circumstance. Concrete thinking is particularly important when you are faced with a complex, difficult, unfamiliar task. As an example, let’s say you have a high school aged child who is considering going to college. It is not enough for you to repeat over and over to yourself, “I want to make sure my child has every opportunity to succeed in life.” At some point, this abstract thinking needs to translate into concrete plans and actions such as:

  • I need to sit down with my child and discuss what she is looking for in a school in terms of academics, size and location.
  • I need to schedule college visits for my child.
  • I need to work with my child to figure out appropriate schools to apply to based on her SAT scores and grades.
  • I need to help my child put together some kind of decision-making framework so that she can select the school that is best for her.
  • I need to fill out the paperwork for financial aid.

So, if you want to get and stay motivated on your personal finances, stay focused on why you are doing these things for yourself and your family. With this mindset in place, you can maximize your chances of success by putting detailed plans in place that lay out what you will do to achieve each of your financial goals.