I’ve learned so much about personal, professional and financial psychology from trying to learn more about parenting. Today I was watching a presentation by Dr. Ann-Louise Lockhardt, pediatric psychologist and parent coach, as a part of The Executive Function Online Summit (TEFOS). While I was watching, I was struck over and over again by how deciphering what keeps your child from accomplishing their tasks is so much like deciphering what keeps us from accomplishing spending according to our goals.

We have goals of saving for our kids college, saving for retirement, saving for that trip with friends. But often our day to day spending gets out of hand, as we respond to our emotional states of the moment.

Step 1 – Acknowledge there’s a problem

First, recognize that our initial instinctive response to an undesired behavior is to try to extinguish or punish that behavior. “I’m going to save money by not going to go to lunch with coworkers again” or “I’m done buying books.” But those behaviors, especially ones that reoccur often even once you’ve decided to stop, are driven by some underlying need you have that is not otherwise being met.

Step 2 – Collect your data

The next step is to find out what is that need that’s underlying the behaviors. This step feels like a big lift, because it can involve some time and some documentation. For kids behaviors, Dr. Ann-Louise Lockhardt recommends journaling for about two weeks, which is psychology speak is called “functional behavioral analysis”, also known as inquiry, discovery, or tracking. For figuring out where your money goes, the equivalent is tracking your money for 1-3 months (depending on how variable your spending is). Use paper and pencil, use a spreadsheet, use an app, write down everything you spent. This is not the time for thinking, or emotional processing, or trying to change your behavior, this is just obtaining data.

Yes, it’s time consuming, and it takes energy. But in the long run, getting through the whole process is going to bring you so much more time, energy, and alignment of your money with your goals, than it takes in the short term. And if you’re working with a partner or a spouse, it brings closeness with them too. Money is a leading cause of divorce, so if you’re not arguing about money, your relationship is going to be better. The long term spiral you’re on right now, that you can break with these steps, is more work and with worse consequences, and is so much harder to fix later, than fixing it now with some extra up-front effort.

If you’ve tried previously tried simple writing down the amounts and stores, and that wasn’t enough, try something more in depth. What does that mean you are you could be tracking?

• the setting
• what happened before the need to spend
• what did the spending look like
• where you’re spending
• how much you’re spending
• what you’re spending it on
• what is the consequence, how do you feel after the spending

Step 3 – Review and hypothesize

Step 3, once you have the documentation in-hand, then it’s time to look carefully at what happened. You’re looking back for the antecedents of the behaviors, the situation that preceded the melt down or the undesired spending, the trigger. Now you’re looking for your why’s. This is your hypothesis, your why do you think this spending occurred, what were you trying to accomplish with this spending.

Your kid may struggle to have good behavior because they got too little quality sleep at night. You may struggle to say no to coworkers about going out to grab a coffee because you need a walk and socialization time to break up your stressful work morning.

Step 4 – Intercede

Step 4 is to figure out other ways to meet or head off those why’s. If your kid struggles to have good behavior during the day because they go to bed too late at night to get the 12 hours of sleep you’ve discovered they really need to function their best, you need to figure out how to get them to bed earlier. And that may include reducing their evening activity load, allowing only one thing on the schedule instead of three. For your spending, you may realize that you need the walk, you need the socialization, you need the mid-morning break, but you don’t need to actually buy the coffee. You can re-route your and your coworker’s walk to a nearby neighborhood, or simply accompany your coworker while they get the coffee they still want, and then drink the coffee in your thermos when you get back to your desk.

Step 5 – Give it time, and get support

And then step 5 is to give some grace. As humans we’re very reactive, and follow a lot of patterns. Once you address that underlying need, don’t expect the old behavior to stop immediately. It takes time to adjust our habits, to become comfortable with the new way of doing things, just like if we address our children’s need for a better night’s sleep they may need some time to settle in to being better behaved during the day.

Another important tip is seeking assistance from others through co-regulation. If you and your spouse are on the same page, or you and your friend group opt for a weekly free round of disc golf instead of a weekly movie, or if you aren’t swamped with everyone’s curated images on your social media platform of choice, then you’re going to have an easier time with changing your spending behavior. Seek compassion, use it to replace frustration.

Example

Let me give you an example from my own family’s life. Shortly after my husband and I started handling our money together, we also ran into the need to run a tighter budget (daycare expenses anyone??). Nothing stood out to us off the cuff, we didn’t view ourselves as extravagant spenders. We tracked our spending for a month, and then looked at the totals. One of the big outliers for us was how much money he was spending on lunches out at work, whereas I brought a packed lunch almost every day. But he was very resistant to reducing his work lunches, and I kept pushing, because we didn’t seem to have any other areas to cut.

Another month or two went by, and he hadn’t reduced his work lunches, so we still didn’t have that extra needed flexibility in our cash flow.

Fortunately we somehow got to the “why” of why he went out for lunch at work. It was because his work lunch was usually spent eating with his best friend, who was single and with a lot of free cash flow so his friend never brought a lunch. Now, by the time we had gotten married, this best friend of my husband’s could have stood on either side of the aisle (yes, I didn’t have bridesmaids, I had bridesmen), I loved him dearly and had zero desire for my husband to spend less time with him. We brainstormed, and realized that on some of the lunches where I joined them, I would bring my packed lunch to the cafeteria, and husband and friend would get a take-out lunch and bring it to the cafeteria to join me.

So we proposed to our friend that they or we meet in the cafeteria more often, and my husband and I would both bring our lunches, while our friend could grab his own takeout meal and eat it with us. Fortunately this idea received zero push-back from our friend, everything worked out great, and we suddenly had cash flow back to pay for daycare expenses. I realize not all solutions will have such a lopsided balance of pros and cons, but don’t give up, they can exist.

Conclusion

It’s only once you can understand your spending habits that you can adjust them to live your life with intention, whether that’s spending more on what’s important to you and your family, saving more for your future, or donating more to your favorite charities.

Then remember, if it was easy, you would have done it already. Just like parents don’t want to have to recruit an expert to help them “fix” their child, everyone struggles to bring their financial problems to another for assistance. It’s hard emotionally, and it’s going to take some sustained effort to fix. Just because you’ve pulled in help, doesn’t mean they can hand you an effective quick fix. A bandaid helps, but true healing takes time.