7 Ways to Keep a New Habit

This post is by Benny Hsu of Get Busy Living.

Have you ever tried to keep a new habit only for you to stop a week or a month later? It happens to all of us.

Don’t worry—you always get another chance to start again. The next time you want to start new habits in your life, try a different approach for success.

Here are some tips to help you to keep your new habits.

1. Know why you’re doing this

Having a strong reason why you are doing something is stronger than how you will do it. Knowing why will keep you focused when you’re tempted to quit. Let me give you an example.

If there is a board ten feet long on the floor and I tell you to walk on it, will you? Of course. If I put that board connecting the top of two buildings 40 stories up, will you cross it? Most likely not. Now if your child was on the other roof and it was on fire, would you walk across? You bet you would.

The situation stayed the same but your reason for going across was the motivator. It’s what drives you.

This is why many New Year’s resolutions fail so quickly. There’s not a meaningful reason for the change. It’s just something you feel like you should be doing.

Really know why you are making this habit and want to keep it. The ones who succeed in making new habits and keeping them are the ones that have a deep reason to change. Find yours.

2. Mark an X on your calendar

When working towards making positive changes, one way to keep you going is to chart your progress. Sometimes the physical progress is harder to see because the changes are gradual. You may need a way to visually see that you are making progress.

When I was training for my first half marathon, I printed out the training calendar and put an X after each day I trained. Once I started, it was rewarding to see so many Xs and to know how far I’d progressed. I wanted to keep those X’s going. I didn’t want a blank box.

At the end of a month, I couldn’t believe how many days of running I’d actually accomplished. Seeing it motivated me to keep the momentum going.

3. Don’t break the habit

Of course that seems obvious, but it’s more than that. You don’t want to do perform your habit for two weeks and then stop for two weeks and then decide to try again. Why?

When you consistently do something with regularity it keeps the momentum going. Doing it everyday keeps you in the routine. Once you stop for a period of time it’s harder to get that rhythm again.

Make an effort to stay consistent each day. Remember slow and steady wins the race.

4. Blog about it

Instead of being accountable to just one person, take it one step further if you have a blog and post your goals on there! You’ll get encouragement but also you’ll also have report to them.

Pat Flynn recently finished a 60 day workout program with amazing results. He said one of his biggest motivations was the people checking in on his progress. He didn’t want to let them down.

5. Don’t punish yourself for falling off the wagon for one day

Earlier, I said don’t break the habit. However we are are human and good habits are not easy to keep. If you skip a day or fall off the wagon, don’t think it’s the end of the world and you’re a failure.

Look at the big picture of how you’re doing. If you are doing something for a whole month like exercising or eating healthy and have one day where you feel lazy or eat a whole pizza, don’t be too hard on yourself.

If you’re trying to cut out soda but you had one at a friend’s house, it’s okay. One day won’t ruin everything.

Focus again starting tomorrow. You’re trying to incorporate this habit into a lifetime change so you’ll have plenty of time to stay on track.

6. Get money involved

Money is always a motivating factor for most people. Here’s one way to do it.

If you want to start a new habit of reading 30 pages of non-fiction a day, four days out of the week for a month, find a friend or relative you can trust and give that person $100 at the beginning of the month.

That person will give you $25 back every week you complete your goal of reading. If you fail to complete it, the person keeps $25. If you complete a week, you get $25 back. Keep going till the end of the month.

Don’t make the amount too extravagant, but don’t make it too small, either. If you do, you won’t care if you don’t have it. Also, make sure you’re honest with your results. Lying about it defeats the whole purpose.

7. Reward yourself

Set a time frame for rewarding yourself throughout the process, not just at the end. You should reward yourself because keeping a habit isn’t easy.

At the end of your set time, say a week or two, if you’ve been doing a great job sticking to your habit, reward yourself with something you want. A day at the spa. A trip to a baseball game. A shopping trip. It’s completely up to you.

Then at the end of a longer timeframe—say a month—give yourself a bigger reward, like a small vacation. If you’ve made it that far, you truly deserve it.

Keep that habit

Studies have shown that it takes three weeks to form a good habit. Take the list above and find the ones that will best motivate you to continue. Developing better habits will lead you to more success and happiness in your life.

Benny Hsu blogs at Get Busy Living where he’s inspiring others to live a remarkable life, explore ways to help people get unstuck and find what excites them everyday. You can also follow him Twitter @Benny_Hsu.

The Smart Way to Use Credit Cards

This post is by Stephen Guise of Deep Existence.

Credit cards are one of the most misunderstood financial instruments in the world. This is a fact—one that explains why VISA and American Express are worth about $60 billion a piece.

The interest rates on credit cards are actually illegal in many states, but a supreme court ruling changed everything by allowing credit card companies to only follow the laws of their headquarter’s state. Naturally, companies moved to ever-popular states such as South Dakota and Nevada because they had lenient usury laws.

Usury laws protect consumers from excessive interest rates. Since that supreme court ruling essentially removed them for credit cards, the rates regularly exceed typical usury limits, with one card charging as much as a 79.9% APR. Still, people are jumping at the chance to build up debt with double-digit interest rate credit cards. According to the USA Debt Clock, the USA has nearly $800 billion in credit card debt at this time.

Be on the winning side for a change

I just recently received a credit card that will allow me to take between two and four domestic round trip flights in the United States, free of charge.

Okay, it isn’t completely free. There is a $95 annual fee for this particular card. Still, I can cancel the card or negotiate that fee at any time, and I still get my flying benefits. I took advantage of a British Airways promotion that gave new customers 100,000 BA Miles (50,000 on first purchase and 50,000 after spending $2,500 in the first three months).

Before this card, I got the Amazon.com credit card. The card allows me to get a $25 Amazon gift certificate for every $833 spent on Amazon and every $2,500 spent elsewhere.

You know what things I really like? Travel and Amazon.com! So far, I have received about $600 worth of Amazon money. It was completely free. I did not spend a dime on anything I would not have bought otherwise. Later this year I will be traveling somewhere exciting for petty cash (you pay taxes for flights—usually $10 domestic) because of my British Airways card.

Why you can win

Credit card companies are statistics experts. You are a statistical probability in their eyes. They will always play the odds and come out richer as a result—the same reason Vegas always wins.

The difference between credit cards and Vegas is that we have complete control over what actually happens. I can pay off my credit card every single month on time (even automatically to ensure it). I can reap all of the benefits of the card without sacrificing much at all.

How to do it

First, have a goal in mind. Do you simply want cash back? Is there a particular store you shop at all the time? Do you want to travel? By car or by plane? There are so many different types of credit cards out there that it’d take a book to cover them all. This link is a great resource for getting started with research. The types of cards are listed in the left sidebar menu.

The idea is to find something you spend a lot of your money on and find a credit card that maximizes the rewards and perks for buying that particular thing or from that particular company. There are low interest cards out there, but if you’re looking for one of those, you’re planning on being on the losing side of the deal (paying ridiculous interest—”low” is probably actually a very high 10%).

Consider bonuses

Sometimes the sign-up bonus makes it worthwhile to get the card. For example, I have limited interest in the British Airways card, but the sign-up bonus is worth more than $1,000. This initial perk would take most cards several years to reach in rewards and it is available very soon after getting the card. Another bonus of the card is that it has no international transaction fees. So if I decide to use my miles to go to Fiji, I can use the card there without the typically exorbitant fees.

Most importantly…

Pay the card off on time. Every time.

It is literally insane to pay 10+% interest on something. Give me guaranteed 10+% interest on my investments and I’ll be rich when I’m older. Pay 10+% interest on money you don’t have and you’ll be swamped in debt in no time. You can thank compound interest for this.

Final advice

Make sure you understand the fees and conditions of the card you get. Don’t look at 12 months 0% APR and be surprised when it jumps up to 20% APR after that. I don’t pay attention to the APR because I’m not interested in paying these companies for no reason. Some great cards, like my BA card, have annual fees that are still worth it. Others have annual fees that the card does not justify.

I recommend doing as I do and “filtering” all of your purchases through your carefully selected credit card. Not only will this practice rack up some serious rewards and perks, but you’ll be building your credit score by showing you’re responsible with debt (which allows you to get better offers). I know of some people who were denied this great BA card deal because their credit score was poor.

I will leave you with possibly the best advice of all: check Slickdeals and search for credit card deals. This website gathers the best deals around the web and if there is an amazing deal out there, their community will find it. Better still, you can read the comments of people who received a similar deal before.

For this BA card, I read several stories of the miles paying for flights to Egypt, Canada, and other places that would have cost thousands. You might also read negative experiences with not being able to use air miles or other red tape that credit card companies sometimes use. If you do your research, you will get a good feel of what to expect from your new card.

VISA has been playing this game for years—but you can still beat them.

Written by Stephen Guise, who has a B.S.B.A. in Finance. When Stephen was willing to fail, he started blogging at Deep Existence. Rumor: American Express is considering giving customers the option to subscribe to Deep Existence at ATM terminals because reading the content there is almost like getting free money. I fully support this idea.

Overcoming Status Anxiety

This post is by Leigh Stevens of whereapy.

Image by Jamie Windon for whereapy, used with permission

It is not wealth one asks for, but just enough to preserve one’s dignity, to work unhampered, to be generous, frank and independent.

—W. Somerset Maugham, Of Human Bondage, 1915

Status anxiety is the fear of being thought of as less than, based on where you come from. It’s the fear that being or having been financially poor makes you less of a person in other people’s eyes, or even in your own.

It’s sort of strange that many of us live in countries where the majority of people are not abundantly wealthy and prestigious, yet there’s still some feeling of shame associated with having less. As though it’s about something more than money—like we’ve confused “it’s better to have money” with “people who have money are better.”

As much as it pains me to admit it, I still have a significant amount of status anxiety. I was born into poverty, and while I don’t live there any more, it’s hard to reconcile the feelings I have about my background with the world I live in now. The degree of social and economic risk involved in trying to feel like and be seen as an acceptable human being is simply astounding.

The American Dream is a beautiful idea, but if you’ve been poor, you know that there’s not much romantic about it, and that while it’s difficult to make changes to your economic situation, stepping into another social class can feel far more complicated and difficult. The fear of being judged or “found out” can really get in the way of living a life of abundance, in the truest sense. In the spirit of overcoming status anxiety, here are a few simple tips that I think can help you get out from under that fear.

Reframe the game with greater purpose in mind

If everyone you knew was jumping off of the Golden Gate Bridge, would you? Sadly, like the rest of us, you probably would. We’re all social conformists, and the pressure to do and see things the way we’re told to is massive.

To move beyond poverty and start feeling good about yourself, you need to stop playing by the rules, and stop conforming by measuring yourself by someone else’s standards. Stop thinking that if you had more money, you would be happier, or a better person.

Remember, life is not a chess game, a pyramid, a race, a ladder or any other oversimplified mental model used to describe it. You can be a rebel and define it by what’s important to you, instead. What really makes you happy? What is your purpose? Start to map out a picture of life based on your goals and core values.

Delight in being humble

If you’ve been poor and have attained a measure of success, becoming humble may be the greatest challenge of your life. I’m talking truly humble. Not the “look at me now—I was once poor and now I’m a rock-star, but I love my roots” kind of humble, but the “I could scrub toilets at McDonald’s and let people who don’t know me think less of me without it bothering me” kind of humble.

Religions of all stripes embrace the idea of humility. If you have a spiritual bent, you could call it an exercise in detachment; humility is the foundation for all mindfulness techniques. Or, even simpler: just call it kindness, to yourself and others. How you view folks who have been or are still struggling tends to be a pretty good measure of how you view your own history: how much of what’s around have you internalized? How harshly do you judge your own experience?

Practicing humility is a daily reminder to you of how wrong it is to treat others with contempt. It’s a practice. I haven’t fully achieved this yet but I’m working on it; I’m pretty sure it will lead me someplace good.

Cultivate mindfulness

Create good feelings wherever you go by seeing the inherent value in every person and offering respect based on that—not their social status. I mean every person, especially the ones who seem to be exceptions to the rule.

An effort to do this will likely require an examination of your core values. What do you believe in? What does “ethical” mean to you? What is right for you? I’m a fan of the Five Mindfulness Trainings of Buddhism, but that’s just one way of looking at it. Create a code of ethics to live by.

Create more, compare less

Typical advice for reducing status anxiety goes something like this:

“Are you frustrated the Jones’ have more than you? Then move to a lower class neighborhood where you can be at the top of the heap. Don’t bother getting out of the box or thinking outside of the box, just move to the other side of the box, where you’ll look better.”

Seriously—that’s the advice—move to a poorer neighborhood. Practical? I guess. The rent would be cheaper, and if what you want is to lord your superiority over your neighbors and continue to amass piles of consumer products without ever questioning why you still feel vaguely empty and unsatisfied, it could probably work.

Or you could drop out of the scene entirely, like Epicurus, who left the city for a rural country life. Just remember to bring your friends, because it’s unlikely that you’ll feel good all by yourself.

The research says that when we compare ourselves to people who have more than we do, we feel smaller. When we compare ourselves to those less fortunate, we feel better. Boo. What a horrible way to live. Imagine if being happy had nothing to do with how we felt we compared with other people. What would life look like then? Life doesn’t have to be a zero-sum game; you can reframe it as an experience to share with others. Use your mind and find ways to be meaningfully social.

More experiences, less stuff

The bad news is that more stuff does not make you happy. It may even make you depressed. If you’ve been fed the idea since birth that the more you have (re: the more you spend), the better you’ll feel, when it doesn’t work it’s easy to feel like there must be something wrong with you. The massive debt-load that so many of us are carrying probably won’t make you feel good either.

The good news is that being present in your life, really experiencing the things that you have, can make you feel wealthy in a way that a Range Rover never will. To enjoy experiences, do them with friends and family as frequently, consistently as you can. It actually doesn’t cost much to have a good time: play cards together, knit together, walk together, dance together, paint the house together, garden together, scrub the floor together, and you’ll feel better.

Your turn! How has status anxiety affected your life? What tips do you have for overcoming status anxiety?

Leigh Stevens is a certified massage therapist, artist, humorist and co-founder of whereapy.

Declutter Your Finances in Five Steps

This post is by David Boyd of CreditCardCompare.com.au

Decluttering might not seem like an important item on the old to-do list. However, whilst it can make the world of difference to your living space, wardrobe (closet), and kitchen you might be surprised at the difference a little bit of work can do in the overall organization of your personal finances.

Image by lordsutch

With a little planning, a few modifications, and a couple of readjustments on your part, you could find that dealing with your finances becomes a much more efficient as well as effective process. Here are a couple of tips that could make it easier for you to get a grasp on your financial life.

1. Reduction and combination

By reducing the number of bills and statements you receive, you may begin to get a better handle upon your finances. Items like newspaper and magazine subscription bills and offers alone can begin to inundate you after a while.

Add in items like the Internet, cable, utilities, health insurance, car insurance, homeowners insurance, mortgage, property tax, and lawn service bills, and add to all those the bills and statements for which you might receive multiple issues of for things like phone (if you have several services or providers for your family phones), credit cards, bank and retirement statements, and similar items, and you could be talking about dozens of items each month that you’re having to sort through.

By doing things such as bundling phone, Internet, and cable services, asking to be billed for certain items on a bi-monthly or quarterly basis, or just ditching some of those items like the magazine and newspaper subscriptions, you can begin to reduce the amount of clutter that arrives in the mail. You will definitely want to consider requesting online notification for certain bills and bank statements.

2. Know your bills

Knowing when your bills and statements typically arrive, as well as when they are due, can help you better keep your financial affairs organized. The fewer items you have to do this with, the easier it makes it to track them, especially when those items arrive on a consistent basis.

If you find that you have a difficult time knowing when you bills are likely to arrive or when they are due, consider using a calendar. This can make it easier to track your finances and help you plan out payment systems or just know what you might need to prepay before you go away on vacation for several weeks.

3. Payroll planning

Sometimes when it comes to your personal finances, it’s just easier to have someone else do the work for you. While automated bill payment can be helpful, it might also reduce your ability to catch errors or know when money is coming out of your account, which could leave you with costly overdraft fees

But when it comes to the items you may be able to have deducted directly from your paycheck, such as health insurance or a health savings account, retirement savings, direct deposit payments to bank accounts, and similar items, payroll deduction could make your financial life much more efficient and easier to handle.

4. Cut credit cards

While you probably don’t want to eliminate credit cards altogether, if you are only using one for the majority of your purchases, it can make it much easier to keep track of purchases as well as help to reduce financial clutter.

Just utilizing one credit card can reduce the number of statements you receive each month, make it easier to track spending and find discrepancies or errors, as well as remember what interest rate or finance charges you are being charged on that particular card.

5. Make a simple spreadsheet

With all the personal finance sites out there to help you get organized by way of the Internet, it doesn’t necessarily mean you need such bells and whistles to help you declutter your finances.

Financial tracking and organizing software may be as simple as a Excel spreadsheet or Google Doc. The main thing is that you understand the software you are using and that it facilitates the decluttering and knowledge of your finances. All the charts, graphs, and nifty graphics in the world won’t necessarily help you organize your finances. Your ability to make efficient use of those items however, can.

These are my tips for decluttering your finances. What others can you add?

David Boyd writes for CreditCardCompare.com.au where users can compare credit cards, including balance transfer offers that help simplify and declutter your monthly finances.

How Investing Increases Your Self-Esteem

This guest post is by Andrea Travillian of Take a Smart Step.

Feel like you need a boost in self esteem?  Well you could follow the traditional advice and go get counseling or use positive affirmations. How about, instead of that, you try using investing to increase your self esteem?

How investing increases self esteem

  1. You get the opportunity to see something grow, that you helped produce. Investing is similar to planting a garden and getting the benefit of seeing your food grow and then enjoying the great taste. Anytime you create something from the ground up, you’ll have increased self esteem.
  2. You feel empowered that you are doing something to take control of your future and change your life. If you have ever started an exercise program, you’ll understand that as you made progress and changed your life you felt better, emotionally and physically.  Anytime you take action to make your life better, your self esteem increases.
  3. Investing decreases stress, which makes you feel like there is one less thing that you’re struggling with. How? Money creates a sound financial base, which decreases stress. Decreased stress allows you to be more creative and have more energy for the rest of your life, thus helping you increase self esteem.
  4. Investing gives you a sense of accomplishment.  Kids develop self esteem by doing things on their own, like tying their shoes.  You too can develop self esteem by investing on your own.

Alright, so you are with me on investing creates self esteem?  But you still have excuses popping up that won’t allow you to get started?  You don’t have enough money, enough time, or enough knowledge?  Well I have some answers to hopefully give you the boost you need to get going!

Not enough money?

If you’re interested in increasing your self esteem, then most likely you are willing to pay for things like counseling and books to help you.  Why not take that money and save it instead?  Consider it another form of therapy.

Another option would be to begin to budget. Budgeting has a tendency to make us feel like we have more money since we quit wasting it.  When we see that we spend four hundred dollars at the spa we might quickly decide that fifty dollars would be better put to our investment.

Not enough time?

Do you have time to watch an hour of TV?  Then you have time to set up an investment.  It really does not take much time!  Don’t have an hour to watch TV?  I am sure that you can find one hour somewhere else in the day—I know that I’d waste at least one hour a day.

You could try waking up one hour early to get your investment set up.  If you set it up on an automatic program, you will be done with just one day of waking early. Just one hour less sleep for one day and you are on your way to higher self esteem!

Don’t know how to invest?

This is one of the best parts of using investing to increase self esteem, because by learning something new you increase your self esteem. So not only do you get the benefit of increased self esteem from investing, but you get more self esteem from learning something new. Let’s look at how you can get started.

Getting Started

So are you ready to start investing to build your self esteem?  Following is a short list of how to get going.

Learn how to invest

If you don’t know how to invest, start learning. Do this by starting to read about investing.  There are many ways to do this, read a magazine  like Smart Money, read a book (I recommend Investing for Dummies), or start studying blogs and websites like Morning Star.  Even small doses of five or ten minutes each day will help you start to learn.

Start saving

Start putting aside a small amount each month to start building your investment experience.  You would not start your first garden by planting an entire acre; you would most likely start out with a few plants and expand your garden each year.  This allows you to learn about what works and what doesn’t while building your knowledge and confidence.  Your investment can even be as small as $25 a month—every little bit helps.

Create a way to track your investment growth

Your tracking tool might be very simple—it could even involve taking out a piece of paper and writing down how much you have at the end of each month.  By posting this you will get to visually see your investments growing.  Watching something grow, like a garden, gives you a sense of achievement. Now you can begin to bask in the glow of your increased self esteem, and your growing wealth.

Do you have an investment? How have saving and investing helped your self-esteem? Share your experiences in the comments.

Andrea Travillian teaches personal finance with the goal of building your financial confidence.   Get your free copy ebook and mp3 on money and contentment at Take a Smart Step.

How to Keep that New-Year Feeling All Year Long

This post is by Dr. Peter J. Meyers of 30GO30.

If you’re a plan junkie like me, New Year’s Day is your High Holy Holiday. There’s nothing quite as liberating as thinking ahead to an entire year of possibilities. Unfortunately, most of us hit January 1st running strong, only to be tripped up by the first obstacle in our path. I’d like to offer a few tips for keeping that New-Year feeling year-round.

Copyright 2009 by Kutay Tanir.

Plan on the obstacles

I know it’s not sexy to plan for setbacks, but it’s essential. It’s easy to hit the gym during your time off, but if that exercise plan falls apart the day you have to go back to work, then what’s the point? You know you’re going back to work. You know that the holiday won’t last forever. Make sure your plans fit your real life.

Work out the details

If your goal is to “get in shape,” don’t just write it on a piece of paper and then watch all the Rocky movies back-to-back. Equip yourself with what you’ll need when January 1st comes. Do you need a gym membership? Do you need some equipment for home or a workout DVD? Are your running shorts in a condition that might get you arrested for indecency?

Figure it out in advance. If your planning is nothing but heady dreams of world domination, and you save the hard stuff for the new year, your plan will fall apart before it even begins. Don’t just make a resolution – resolve yourself to a specific, actionable plan.

Think day by day

It’s easy to make big plans and bask in the glory of what might be, but how do your big plans translate into day-by-day activities? What will you do, specifically, on February 17th or June 3rd? If your New Year’s resolution is to write a novel, you’re probably not going to just think really hard for 364 days and then spew out 400 pages on December 31st. How does that novel translate into pages and words on a daily basis? Are you going to write every day, or just five or six days each week?

If you ask these questions ahead of time and really know how your aspirations translate into action, you’ve got a great shot at succeeding. If you don’t, you may be writing a fairy tale.

Make planning a habit

Sometimes, we get carried away with New Year’s resolutions. The problem is, we’ve essentially picked only one day per year to plan the most important aspects of our lives. We plan every day for the minutiae of our lives, but somehow the really big, important goals get relegated to a December 31st motivational binge.

Set aside time every week to plan. Make it the same time, and really build a planning habit. Your big goals deserve that much. Of course, this means asking the tough questions every week, too. Is this the right direction? Do you have what you need to make it happen? If you set aside the time to evaluate and plan, you may change direction, but you’re much more likely to reach at least one of your destinations.

Dr. Peter J. Meyers (“Dr. Pete”) is a cognitive psychologist, accidental entrepreneur, and aspiring non-procrastinator. He recently founded 30GO30, a site dedicated to finding out exactly how much you can accomplish in 30 days.

The Positive Power of Negative Thinking

This guest post is by Vergil Den, author of The Stoic’s Burden.

  • A triathlete comments that training and preparation for a competition is harder than the competition itself.
  • A general creates a contingency plan against the event of an unexpected attack by the enemy.
  • An engineer tests the rudder of a plane at twice the expected normal load.

What do all of these individuals have in common? They’re harnessing the positive power of negative thinking.

In this age of positive thinking, negative thinking has gotten a bad rap. And why not? Most people would rather not think about the bad things that can happen in life. But just as positive thinking has a place in goal-setting, practical negative thinking has a place in goal achievement.

Fortune at the door

Are we prepared for what fortune has to offer us in life? Life is not like a box of chocolates—unless some of the chocolates are spoiled. We must face the harsh fact that bad things happen.

The ancients knew something about fortune. The myths of antiquity often have fortune as a central theme. The Stoics, in particular, were aware of fortune and its random, uncertain nature. They would visualize all the negative things that could befall them so they were prepared for the event, both physically and emotionally, if it were to occur.

Fortune may appear to be totally random, but a lot of seemingly random events are in our control. Why does it seem then, like they are not in our control?

Studies have shown that people often overestimate what they know and underestimate what they don’t know. Consider the following example. In 2000, Time Warner merged with AOL. At the time, the deal was the largest in history and was expected to create a company that would revolutionize the digital industry. This likelihood was heralded by both experts and non-experts a like.

In fact, this turned out to be one of the worst deals in history. If you invested in these companies at the time the deal was announced, your investment would have been nearly wiped out. What happened here? All the experts were wrong. It was a case where they overestimated what they knew and underestimated what they didn’t know. For an investor, with proper planning, this seemingly random bad event could have been avoided.

Goal achievement

So how can we apply the Stoic principle of negative thinking, and the negative thinking that we know less than we do know, and even less about what we don’t know, to help us achieve our goals? Follow these five steps:

  1. Establish your goal, and identify what you think it will take to reach that goal. This is the positive form of thinking that we all do.
  2. Then think about the worst things that could happen on your way to reaching that goal.
  3. Put a plan in place to either mitigate the risk of those events occurring or mitigate the risk associated with the impacts of those events.
  4. Modify the actions needed to reach you goals from step 1 with the newfound risk insights from step 3.
  5. Periodically repeat steps 2 to 4. This is an important step because things in life are always changing and risks evolve. What may have been adequate now may not be in six months’ time.

Negative thinking and the stock market

When we think about investing, we often visualize making lots of money. This often leads to excessive risk taking. Try this instead: visualize losing all of your money in your investments and imagine how that would make you feel. How would that impact your life and your family? If there’s a significant impact, then put into your investment strategy the proper controls to avoid this failure. For example, if you purchase an individual stock, you might consider also putting in a stop loss.

Negative thinking in business

With all the self-help business management books out there, you would be certain that to be successful all you have to do is work hard in addition to six other successful habits. This is nonsense. These books are written by those who succeeded—and produces something that’s called survivorship bias. These books are not typically written by those who actually failed.

The attributes of the successful are often the same as those who failed. For every Jack Welch, there are thousands of others with the same attributes that failed. To be successful in business, one must avoid failure. Once your business goals are set, visualize the events that could cause your business to fail. How does that feel? Now think about what you can do to avoid those failures. For example, consider the concept of tinkering and how that can help your business avoid total failure.

Negative thinking in life

None of us like to think about death. But death is an important part of life. Think about it for a moment. How does it feel? How would those you love be impacted by your death? Many people don’t anticipate death, so when it occurs (I can guarantee that it will), their loved ones are left to struggle with the loss both emotional and financially. If your death will impact your loved ones, you might consider at least a low-cost life insurance policy.

We can also apply this thinking to job-loss preparation. Most people don’t prepare for job loss, but by visualizing losing your job and the impact it would have, you can prepare. For example, it is recommended that people have at least six months in operating costs available as cash in a savings account.

The positive power of negative thinking is a check to the natural, irrational exuberance we feel when we try to attain success. Also, by thinking about the negative events, if and when they occur, the bitter taste of their impact will be lessened thanks to your planning. And if and when you finally succeed, the taste of success will be that much sweeter.

Vergil Den is a free thinker and a recovering wannabe Empty Suit (i.e., a heartless corporate executive). He now doesn’t take himself quite as seriously and periodically muses about life at www.vergilden.com.

Feeling Lucky? The Positive Effect of Talismans

This guest post is by Christy Smith, of ThinkBlot Communications.

It found me last summer. I was doing a bit of window shopping, and there it was on the arm of a mannequin in the window: a simple, black, metal cuff that said “Be Extraordinary”. As I put it on my wrist, I felt something shift inside me. I didn’t even look at the price tag; I bought it on the spot because I knew it was meant for me.

For years I’ve been drawn to objects that carry a simple “Be” message: be inspired, be you, be generous. At the moment when I saw that bracelet, I wanted nothing more than to be extraordinary.

Looking back, when the bracelet came into my life, I was standing at a crossroads. Open before me was the traditional path that I’d been following for years. There was nothing new or special about it—it was comfortable and well-worn. But I had caught a glimpse of another path, one that was uncertain, risky, and scary, but appealed to my deepest desire to do more with the gifts I’ve been given. I felt like those simple words, Be Extraordinary, summed up what I knew I needed to do if I was going to pursue that new dream.

I wear the bracelet every day, and now feel as naked without it as I do without my wedding ring. The bracelet is my personal call to action. It is my talisman for good luck in navigating my new path, and is a constant reminder that I should strive to do not just great things, but extraordinary things. This small object is the physical manifestation of my goals and dreams.

Why do talismans touch us?

The use of talismans goes back to ancient times, when people believed that certain objects carried mystical powers and harnessed positive energy. To be in possession of one granted you access to those powers. Talismans were used as protection from bad luck, and a way to focus energy on a positive outcome that the owner hoped would come to pass.

In times of uncertainty, adversity, and personal reflection, talismans become particularly attractive. They can make us feel like we’re giving control of our destiny to something outside of us. Even though we are still 100% in control, it’s within this illusion that we can drive the behaviors needed to achieve our goals.

Talismans can be any physical objects, like a photo, piece of clothing, or an item of jewelry. We may keep and treasure things that belonged to loved ones who are no longer with us because we feel the connection to them through those objects. Those connections bring us strength and comfort. We may assign significance to talismans that are given to us under special circumstances if we think that they will bring us the same type of luck or fortune that was enjoyed by previous owners.

A confidence boost

We’ve all heard the stories about athletes who wear a certain item of clothing each time they compete, performers who insist on having certain items around them before they go onstage, or artists who need a special object in order to create. The behaviors all stem from the same kind of belief. It’s a bit superstitious, but nonetheless many feel that consistently creating the same environment will drive the desired level of performance.

A recent article in the Wall Street Journal detailed the story of a wig that was being passed between cancer treatment patients. Each of the previous owners of the wig had fought their battle against cancer and won. The wig brings hope as it is passed along the chain from survivor to current patient. The wig carries with it each woman’s story, and is considered a powerful good luck charm for each new recipient.

Trying to debunk the mystery

Of course, there’s nothing mystical or magical about the power of a talisman beyond the energy that we give it. It becomes the outward manifestation of our inner motivations, wants, and needs. Using a talisman is harmless to the extent that we draw positive energy from it in our times of need. Our talismans are there for us on even the darkest day, to give us a sense of comfort, security, and hope.

Science now is starting to dig into these superstitions, with surprising results. Barbara Stoberock, Thomas Mussweiler, and Lysann Damisch from the University of Cologne published earlier this year the results of their study, which concluded that people who used good luck charms during the research study performed better on tests. The researchers theorize that those participants had higher confidence in their abilities. There was nothing about the charms that actually led to better performance—other than the participants’ belief in them. This research implies that talismans are a classic example of the placebo effect. But why knock it if it works?

I know that my bracelet doesn’t actually confer special powers onto me. The results of my actions, good or bad, are completely my own. I don’t blame the bracelet if I make a bad decision, and on the flip side, if something wonderful happens, I take full personal credit. But I wear it all the same. I like having the symbolic reminder, and it makes me happy when I look at it. And still every day, I work to Be Extraordinary.

Christy is the founder of ThinkBlot Communications and is a self-diagnosed Pollyanna. She is currently exploring the ways we can create positive self-dialogue to achieve our goals. She can be found at Twitter @thinkblotcom.

Get a Grip on Your Finances—Without the Guilt

This guest post is by Ali Luke, from Aliventures.

Do you wish you had a better grip on your finances? Perhaps you know that you’ve got problems—you’re always in your overdraft, or you’re barely able to make the minimum payments on your credit card—but it’s tempting to keep your head in the sand.

Maybe you’ve been getting by like this for years: never feeling financially secure, but never wanting to face up to the gap between where you are and where you want to be.

Money can stir up a lot of strong emotions, like fear, pride, hope, and—when we’re struggling—guilt.

It doesn’t need to be like that. You may have made mistakes in the past, but most other people have too. We all get things wrong sometimes. Rather than feeling paralyzed by guilt, focus on taking simple actions to change your financial future.

Find out where you stand

This is the hardest step for many of us.

Open up your bank statements, bills—anything you’ve been avoiding. Get the big picture:

  • How much money do you currently have in your checking account, in savings, and elsewhere?
  • What debts do you have, including student loans, credit cards, and so on?
  • What’s your monthly income?
  • What are you spending each month, roughly?

Get as clear as you can about where you are. Don’t judge yourself, or anyone else involved. However bad the situation, it can be changed.

Cut your costs

Go through a bank statement, and look for any monthly payments. There’ll be plenty of big-ticket items, like your rent or mortgage, but also some smaller ones like:

  • broadband, TV, and phone packages
  • subscriptions (to magazines, DVD rental services, and more)
  • gym memberships.

Can you cut any of these costs? A lot of people find they’re making monthly payments for services they never even use: magazines that they don’t read, or health clubs they don’t visit.

Can you reduce your spending in other areas? Perhaps you’re reluctant to give up your home internet access and TV shows, but you could downgrade to a cheaper package.

Although it often doesn’t feel like $10/month makes much difference, it adds up; if you can save $10/month in three different areas, that’s $360/year—enough to cover emergencies or simply make the festive season more affordable.

Sign up for internet banking

If you don’t already access your bank account over the internet, talk to your bank and get set up. It’s easy to keep on top of your money, and set up and cancel payments if you can do it from work or home at any time of day.

Once you do have internet access to your bank account, I’d suggest setting a regular time to check on things—at least weekly, to begin with. That way, you can keep an eye out for any unexpected payments and spot potential problems quickly.

Keep a spending log

You’ve got some fixed monthly bills, but where does the rest of your money go?

Don’t worry if you only have a vague idea. It’s hard to keep track of all the little items that you buy: a coffee here, a sandwich there, an occasional newspaper. When you’re spending a few dollars at a time, you probably barely think about it. But those small amounts are adding up.

A spending log is simply a recording of everything you spend. I like to use a spreadsheet for this, divided into columns to show different categories (like “groceries”, “eating out”, and “transport”).

To be really useful, your spending log should:

  • include everything you spend—even the small items, and even things you pay for in cash
  • contain enough detail to be useful, which might mean noting down what you bought at the coffee shop, rather than just writing “coffee shop – $7”
  • be updated daily (if you leave it more than a day, you’re likely to forget some purchases).

Once you’ve tracked your spending for a month, look for any results which surprised you. Are there any areas where you’re spending a lot of money unnecessarily? If you’re buying lunch out every day, for instance, that adds up fast. The same goes for a daily paper that you barely read.

Most people who take this step also find that the act of writing down their spending makes them more thoughtful about it. Don’t let this turn into a guilt trip, but do use it as a prompt to think twice before buying something on a whim.

Start researching

Whatever your particular financial struggles, it’s a safe bet that other people have faced exactly the same thing—and written about it.

There are several great personal finance blogs, and plenty of books, which can help you get back in control of your finances and start saving or investing your money.

I’d suggest starting with these blogs and searching for advice on any specific problem that you’re facing:

The Simple Dollar
Get Rich Slowly
I Will Teach You To Be Rich

Getting clear about your finances can be liberating. Instead of struggling on, trying to ignore the situation, you’re facing it head-on and taking action to start making the changes that you want.

Have you got a grip on your finances? What tips—or horror stories!—can you share?

Ali Luke blogs about writing and life over at Aliventures and has a free ebook called More For Your Money, about getting your best value from your hard-earned cash.