In James Clear’s book, Atomic Habits, he concisely illustrates a very important point. Often we think that we need to design the most optimal habits in our lives. For example we need to have a plan to exercise two ours each morning with the proper amount of cardio, aerobic and strength exercises. While doing this can certainly be a great boost of confidence and personal fitness, Clear points out that most of the time we don’t need complex habits – we need two minute habits.

Creating habits is hard enough. For anyone who has tried to change their daily routine for the better, they know how much of a challenge shifting behavior can be. Yet nearly all of us fail. The reason? Our habits aren’t simple enough.

Clear tells us not only to start with two minute habits but to make the cues and catalysts for those habits almost automatic. After all, “You can’t improve a habit that doesn’t exist.”

An area that I have personally been working on is the area of personal finance. I have thought about this topic a great deal in my personal life and have come to the conclusion that there are three key habits for anyone serious about controlling their money:

1) Pay Attention

Tracking your fitness has been shown to produced fitter people. Watching your personal growth has been shown to produce successful people. And measuring your finances has been shown to make richer people. Many studies illustrate this point. Simply staying on top of your bank balances, credit card balances, credit score and retirement accounts will leave you in a much stronger position. The reason is that we tend to improve things we pay attention to.

2) Plan Ahead

Creating a written plan and sticking to it is actually what separates us from animals. We have the ability to plan ahead and participate in what Ray Dalio calls “higher level thinking”. The plan doesn’t have to be complex. You can sit down with your advisor or do it yourself.

3) Learn

This blog isn’t intended to be the sole source of your financial information. But if you combine regular blog and book reading with input from your financial advisor you can improve your knowledge exponentially over time.

Conclusion: 

Do you want to bolster yourself to the top 1% of Americans? Do you want to experience less financial stress and uncertainty? Follow my three-pronged approach to 1) pay attention 2) plan ahead and 3) learn.