Using the Science of Willpower to Be Better With Money


Getting better with money and achieving your financial goals do not happen through passive waiting, wishing for life to be different, or gimmicky quick-fixes that promise you instant wealth. Living a life of abundance requires a (pocket) change of heart. Thankfully, behavioral scientists have uncovered the secrets of willpower that have the power to transform the way you think and behave in relation to money.

Get ready to learn about persistence, self-efficacy, impulse control, and other topics that will help YOU create the motivation for financial change. If you are a thinking person who is ready to be better with money, this website is for you. Let’s create a community of pocket-changers! Please join in on the dialogue by posting your comments.

Photo by Martin Hirtreiter; Wikimedia Commons

Photo by Martin Hirtreiter; Wikimedia Commons

Over the last three blog posts, you’ve learned about the limits to self-control, and you’ve learned how your impulses can sometimes take over your money behavior.

Now take a look at the strategies for strengthening self-control. Here are the top ten tips:

  1. Gain knowledge about the “high risk situations” that may disrupt your progress toward your financial goal, and then create a plan for dealing with each potential obstacle.
  2. Make simple changes in your environment that will allow you to avoid temptation.
  3. Design prompts, triggers, or systems that will allow you to make a goal-consistent decision without having to agonize over it each time it comes up (for example, automatic savings plans).
  4. Formulate subgoals or intermediate goals that will allow you to take steps toward your larger objective, and set clear expectations and a time frame for each one.
  5. Practice, practice, practice! Repeat healthy behaviors until they eventually become more automatic and replace their unhealthy counterparts.
  6. Train your working memory to strengthen your ability to focus on a goal despite multiple distractions. You can do this through simple mindfulness or present-focus exercises.
  7. Strengthen your ability to shift your attention to the less tempting aspects of the situation you are in.
  8. Reduce the stress (both emotional strain and cognitive overload) in your life. Stress makes you more vulnerable to acting impulsively.
  9. Get enough sleep in order to make certain that your frontal lobes are in good working order. This will allow you to exercise good judgment and to inhibit your impulses when needed.
  10. Plan breaks throughout the day that allow you to monitor your level of self-control and prevent regulatory depletion.

Which of these strategies have you tried? What are the strategies with which you are willing to experiment?

Photo by Johannes Otto Foerst; Wikimedia Commons

Photo by Johannes Otto Foerst; Wikimedia Commons

Over the past couple of blog posts, you’ve learned about the “unthinking side” of yourself, which includes the gut reactions and snap decisions that happen underneath the radar of your consciousness. You’ve also learned about the “thinking side,” which is the systematic, logical planning system that makes sure the impulsive self does not always get its way when you are making financial decisions.

Now, think for a moment about the reasons why the unthinking/automatic system can overwhelm your thinking/controlled system. In other words: Why do your impulses take over your behavior, even when you have the best intentions to stick to a financial goal?

Here are five reasons:

  1. Ego depletion. This is also known as regulatory depletion. Think about all of the situations you encounter in a day which require you to regulate your behavior, hold back distressing emotions, suppress certain things you want to say or do, or choose from an overabundance of options. Scientists have discovered that all of these tasks drain your supply of self-control and make it more difficult for you to persist in the face of obstacles. Regulatory depletion means that if you’ve used up much of your supply of self-control on one task, you have limited self-control available to use on the next task, even if it is a completely different task.
  2. Cognitive overload. Basically, the more you have on your mind, the easier it is to give in to temptation.
  3. Emotional overload. The more stressed you become, the more difficult it is to maintain self-control.
  4. Lack of awareness. If you aren’t aware that a given situation is one that could cause you to lose sight of your financial goals, your self-control can be obstructed.
  5. Overpowering urges. Sometimes, an urge is so powerful that it saps every bit of energy required to maintain self-control. For those who have good inhibitory control and who have cultivated discipline in their lives, this happens less frequently. But no one is completely immune to overpowering urges.

In the next blog post, you’ll learn several strategies for strengthening self-control.

Until then, ponder this: Which one of the five conditions listed above do you think is most problematic, either for yourself or for other people?

cupcakes challenge self control

Photo by Joy; Wikimedia Commons

This post marks the second in a four-part series aimed at understanding impulse control and why it’s important when it comes to maintaining our financial health.

Last week, we looked at the “unthinking side” of impulse control: the impulsive self that operates underneath the radar of our conscious mind and makes quick decisions that sometimes get us into trouble. (Think, “Exactly how did that pack of cupcakes jump into my grocery cart without my awareness?”)

Now let’s consider the “thinking side”: the other system, called the controlled system, that makes sure the impulsive self does not always get its way. This is the systematic, logical, planful side of ourselves that makes a list long before we get to the grocery store to make sure those cupcakes don’t jump into the cart!

It’s the side of ourselves that can think through things using language and reflection and can identify what is going to be best for our overall health and well-being down the road. This side is interested in saving rather than impulsively splurging. It is engaged in thoughtful research into investment products rather than acting on a random tip from the guy at the office water cooler.

What are the components of this controlled system? There are probably many, but science has uncovered at least three components so far: (1) learning history, (2) working memory, and (3) inhibitory control.

First, we know that there are certain learning activities that may help children build skills in self-discipline that will come in handy later in life. For example, activities such as music lessons and organized sports may help children learn to follow directions and control impulses. There is even some evidence that self-discipline can be strengthened in children through games such as “Touch Your Toes!”, which requires children to touch their heads when the leader says “Touch your toes,” and to touch their toes when the leader says “Touch your head.”

Second, our controlled system works better when we have better working memory. Working memory is the capacity to hold several pieces of information in our head, to manipulate that information, and to use it in a constructive way. If someone reads seven digits aloud to you and asks you to repeat the digits back in reverse order, you would be using your working memory. It seems that if we have good working memory, we have the ability to focus our attention on some end goal without getting sidetracked by temptations.

A third component of the controlled system is inhibitory control, which is our ability to put the brakes on our behavior when we need to. This task is usually handled by the frontal lobes of the brain, which serve to stop us from acting against our better judgment. Another term for this is “executive functioning.” This system seems to be trainable to some extent, but it may also be subject to the limits of our physiology.

Next week, we’ll take a look at why our impulses sometimes overwhelm our controlled system and take over our behavior.

Until then, think about this: What are the areas of life where marketers and advertisers are expecting us to go with our impulses instead of using our reflective thought?

Photo by Dave Dugdale; Wikimedia Commons

Photo by Dave Dugdale; Wikimedia Commons

“Control” is a word that gets a bad rap. No one wants to be accused of being a control freak or engaging in controlling behavior.

At the same time, self-control is one type of control that we probably wish to have in abundant supply, because the lack thereof could be devastating to our finances.

This post begins a four-part series aimed at understanding impulse control: (1) the unthinking side, (2) the thinking side, (3) why impulses take over our behavior, and (4) strategies for strengthening self-control in the service of better money management.

Let’s start with the unthinking side of things. Science has uncovered the fact that there are two processing systems at work in the mind as we move through the day: controlled processes and automatic processes. Controlled processes are the things that we think about consciously using language—we’ll get to that in part two. Automatic processes happen without the need for conscious attention or control. In other words, they are the “unthinking” things that happen underneath the radar of our consciousness, such as our gut feelings, visceral reactions, emotions, and intuitions.

The automatic system runs the side of ourselves that you might call the “impulsive self.” Consider what would happen if you faced a tempting situation and weren’t allowed to think it through. Imagine a giant piece of chocolate cake staring you in the face, the impulse purchase you might make at your favorite store, or the gutsy move you might make with your investment funds. If your thinking system is disabled, all you have left is your impulsive self to make quick judgments and then set habitual actions in motion.

Where do these habitual actions come from? Probably a complex composite of several different sources, including your personality (how you are wired), your current needs (what it would take in this situation to pursue pleasure and avoid pain), and your learning history (which of your responses have been reinforced in the past).

Thankfully, we have the controlled system to ensure that our impulsive self does not dominate all of our daily transactions. You will read more about that system in the next post.

For now, though, think about this: When are you most likely to see your impulsive self emerge? Can you think of any famous examples of individuals who got in trouble because their impulsive self was able to act unchecked?

Mapping out better habits

Mapping out better habits

Research by Oettingen (European Review of Social Psychology, 2012) suggests that if we’re working on building good money habits, we might benefit from the “WOOP” exercise.

Although it sounds like a fancy new dance step, it’s really just a quick mental strategy that helps you to predict what problems might get in your way and to map out your alternate routes. Here are the four components of the exercise along with an example:

W = Wish: What is the healthy new behavior that you’d like to achieve? [I’d like to put 10% of my paycheck in my savings account.]

O = Outcome: What are the good things that will happen once you’ve built this habit? For instance, in what ways will you feel better about your situation and about yourself? [I will have more peace of mind because my rainy day fund will be larger. I will feel more responsible and more confident about my ability to exercise discipline.]

O = Obstacle: What are the barriers that might get in your way as you work toward this new, healthy habit? [One barrier is that I might excuse myself from saving that much if an unexpected expense (like a car repair) comes up that month.]

P = Plan: What are the specific behaviors you plan to perform in the specific future situation when the obstacles arise? [If I find myself with unexpected expenses, I will cut back on my food and entertainment budget that month so that I can still contribute 10% of my paycheck to my savings account.]

Studies show that these specific WOOP plans (also known as coping plans or relapse prevention plans) are much more likely to lead to successful habit change than vague goals, visualizing our success, or “thinking positively.”

How do you think a WOOP plan might help you?

For additional thoughts about change processes, consider checking out this week’s blog post at

Practicing Good Money Habits

The pace of change is often slow, like this dollar bill origami snail (photo by RangerRick; Wikimedia Commons).

It’s a new year and you’ve taken on a new money goal: saving more, spending less, or expanding your financial literacy.

The self-help industry proposes that it can help you with these financial goals. Be careful! While some of the advice you read in self-help books may be sound, much of the advice perpetuates myths about the process of change.

Watch out for the following myths:

  1. You can change your financial life by setting good intentions.
  2. You can get better with money by thinking positive thoughts.
  3. All it takes is willpower to transform your financial habits.
  4. Visualization will go a long way in bringing you the riches you desire.
  5. You can launch good money habits with positive affirmations.

These myths are widespread and often conveyed in a passionate and convincing manner. Unfortunately, though, they divert people away from habit change efforts that are practical, workable, and realistic.

What really works to change a money habit? It helps to take a scientific approach to the change process. Choose one small thing to work on and adjust it incrementally, a little bit at a time, until it looks closer to the behavior that you desire. Then move on to the next small thing, and so on.

The scientific approach may not be as glamorous as vision boards, self-affirmations, and the power of positive thinking, but it produces far more successful outcomes.

What life changes have you made using a systematic, incremental approach?

To read about more factors that lead to successful change, check out the current blog post at

Original photo

Original photo

Personal change is a popular topic this time of year as many individuals commit to New Year’s resolutions. As a reader of this website, you already know that successful attainment of self-improvement requires (1) setting a goal; (2) taking actions that lead you to your goal; and (3) monitoring your progress (allowing you to adjust your behavior as necessary).

We now know that there are a couple of “super-ingredients” that help you to boost your chances of success in your change efforts.

One super-ingredient is called an implementation intention (Gollwitzer, 1993, 1999). An implementation intention is a highly specific plan that you use to change your habits at high-risk times.

Here is the basic formula to use when you are building your implementation intention:

“If I [name the specific obstacle, such as a thought, emotion, or situation] and I am tempted to stray from my personal goal, then I will [choice of healthy behavior].”


If I drive by my favorite store on the way home from work and I am tempted to stop in and spend money, then I will stop at my favorite park instead.

If my friends invite me to a restaurant where I will end up spending beyond my means, then I will decline the invitation and offer to arrange the next gathering.

This technique is believed to work because it prompts you to identify the exact cues or triggers that lead to your unhealthy habits. This makes you more likely to notice your habitual behavior. It also makes you more likely to identify your “choice points,” which are the times when you have the freedom to depart from your automatic behavior and choose something healthy for yourself.

Another super-ingredient is called self-efficacy (Bandura, 1977, 1997). Self-efficacy is your belief in your ability to organize and execute the courses of action that are necessary to attain your goal.

In a recent study (Koestner and colleagues, 2006), participants were instructed to boost their sense of self-efficacy by doing three things:

(1)   They were asked to think about past situations in which they achieved a similar goal.

(2)   They were asked to think about situations in which an individual who is similar to them achieved a similar goal.

(3)   They were asked to think about a person who encouraged them to reach their goal.

In this study, participants who used the two magic ingredients (implementation intentions plus self-efficacy) reported significantly higher levels of progress toward their goals compared to individuals in a control group.

Just a few simple tasks, then, can help take you from choosing a resolution to actually carrying it out. Now you have the tools to make it a great new year!

I wish you all the best in 2014.

Climbing Everest

Photo by Lloyd Smith; Wikimedia Commons

Do you feel like you have some financial mountains to climb this holiday season? Perhaps it is time to pause and regroup. Take a few moments to assess your current levels of stress, motivation, and impulse control. If there is too much stress and too little self-control, now is not a good time to make significant financial decisions.

If there is too little motivation, perhaps you can draw inspiration from these words:

“Your present circumstances don’t determine where you can go; they merely determine where you start.”

-Nido Qubein

“You have a clean slate every day you wake up. You have a chance every single morning to make that change and be the person you want to be. You just have to decide to do it. Decide today’s the day. Say it; This is going to be my day.”

-Brendon Burchard

“The people who get on in this world are the people who get up and look for the circumstances they want, and, if they can’t find them, make them.”

-George Bernard Shaw

“The vision must be followed by the venture. It is not enough to stare up the steps – we must step up the stairs.”

-Vance Havner

“Life is a grindstone. Whether it grinds us down or polishes us up, depends on us.”

-L. Thomas Holdcroft

“Always dream and shoot higher than you know you can do. Don’t bother just to be better than your contemporaries or predecessors. Try to be better than yourself.”

-William Faulkner

Photo by Puschinka; Wikimedia Commons

Photo by Puschinka; Wikimedia Commons

Hooray! I’m happy to celebrate three years of blogging about motivation, persistence, and impulse control and their relationship to financial health.

It has been a great year. In July, I released my book Pocket Change: Using the Science of Personal Change to Improve Financial Habits. What a joy it has been to see this work come to fruition. Thank you to my readers who offer inspirational comments and insights each week. I look forward to future conversations as we continue to build a community of Pocket Changers!

Financial fitness through time

Original photo

Many of the questionable financial decisions we make occur because we act without first engaging in sufficient thought and reflection. We don’t give ourselves enough time to become fully aware of what we are about to do—and then we act impulsively.

Perhaps the most effective thing you can do to act with greater discipline in the area of personal finance is to increase the gap between your impulse and your action.

Consider a few ways to increase this gap:

  1. Give yourself a waiting period. For instance, design a rule for yourself that you will not make any non-essential purchases that cost more than $75 without giving yourself a three-day waiting period.
  2. Take a walk before you make an important financial decision. Walking can boost your mental clarity which, in turn, supports good judgment and decision making.
  3. Shift your attention. See if you can focus your attention on your breath or on sounds in the environment. Get immersed in the present moment. Then, after you have been successful in shifting your attention somewhere else, you can come back to your money decision with a fresh perspective.
  4. Use a checklist of important questions to evaluate your situation. For example, try:
    1. Is this purchase a need or a want?
    2. Do I truly have the money for this purchase?
    3. What will this purchase mean for my level of financial fitness?
    4. Will this purchase truly make my life better?
    5. Will this purchase still have value to me in one year/five years/ten years?

Remember, when your supply of self-control is depleted, it becomes much harder to think creatively about any important topic. Do a quick assessment of your current state of impulse control before making money decisions.

How do you increase the gap between your impulse and your action?