The Psychology of Financial Change
New beginnings bring hope, but lasting financial success is built on the foundation of our daily habits and emotional triggers.
“We must acknowledge that for many South Africans, poverty and financial insecurity are not of their doing… for others, their financial situation is a result of consistent behavior—their habits with money.”
1
What are you spending your money on?
Knowledge is the starting point. Most people cannot accurately state what they spend on essentials like food, insurance, or data. To fix the picture, you must first see it.
- The 3-Month Rule: Review the last 90 days of spending to establish your true behavioral patterns.
- Classification: Decide what is essential vs. non-essential. This highlights what to prioritize and what to eliminate.
2
Why is it difficult to make the right decisions?
Our connection to money is emotional. Whether it is a fear of not fitting in (leading to overspending) or a fear of lack (leading to hoarding), these triggers often stem from how we were raised.
3
How will you decide going forward?
Don’t rely on willpower alone—build systems. Following the philosophy of James Clear’s Atomic Habits, focus on small, manageable changes. Big transformations are simply the result of tiny habits compounded over time.
Patience in the Process
Financial success is possible, but it isn’t linear. You will get it wrong sometimes. The trick is to keep moving in the right direction, one small habit at a time.
Provided by: Gugu Sidaki, CFP®
