Self-awareness is probably one of the most important skills that is beneficial to our livelihoods. When we are self-aware, we make better decisions, develop positive habits, and have a better attitude about ourselves in general. The principles of financial psychology also bring attention to how self-awareness can impact our finances. Financially, our behavioral choices and emotional attitudes inform our status. It is up to us to decide if this current financial status is desirable or not, and furthermore, how we aim to make changes.
Being self-informed insinuates that one is knowledgeable about themselves, their desires, behaviors, and attitudes. For example, “Dogs are my favorite pet” is a self-informed statement because it acknowledges the animal that you like. On the other hand, “Dogs are my favorite pet, and I would love to adopt” suggests your position and what you want to do because of this. That is the difference between self-awareness and self-information. One is made self-aware when they become so informed, that an action follows. What are you suggesting? We are highly self-informed on our current circumstances, desires, emotions, personalities, and our livelihood in general. However, there is a lack of action that takes place once we understand what our personal status means. In our financial health, being actionable is most important, sometimes more than just being informed on something.
If we do not take the necessary steps to do something, no changes can be made. Once you have become informed enough about your financial habits, like spending, saving, investing, or budgeting, the next goal is to create parameters around you that build off this knowledge. This could mean using a digital budgeting planner rather than paper if you notice difficulties in connecting or finding time to sit down to do so. Another example of an action step could be opening a separate savings account once you have realized that you are beginning to conflate certain responsibilities. The simple efforts and actionable steps we take can only be made successful after we have realized their total impact on our lives.
This principle of self-awareness is vital to our financial health, but it is a skill that can be attributed to every area of our life. As a society, if we were to limit the time between contemplation and action, we might experience faster growth. This does not mean to ignore or speed through the stage of collecting information or strategic evaluation. What it does suggest is that we shouldn’t just brainstorm, research, or consult. We can do both! We can be inquisitive and still experiment. We can discuss our new informed opinions and hold ourselves accountable to the same principles.
So how do I become more self-aware in addition to being self-informed? The trick is to have a counterbalance for every strategy. For example, we always start with education. The more that we become educated in financial terminology, banking, and management, the more confident we feel to make certain changes. However, you want to set a limit to how much external information you take in as law. This could mean limiting your time of educational discovery to 30 minutes a day, or whatever feels most accessible to your lifestyle. After the set time of research, spend additional time reciting the information to yourself. This
could mean journaling the top five keys that stuck with you. Or recording a voice message of you reciting the information to yourself. That way, your brain has time to compartmentalize how this information can apply to your personal status. You may be surprised at how much similar exercises can help mitigate overstimulation.
After we have become educated, our next point of concern is to “plan” our next actions. This is where it can become tricky if we are not careful. This stage of planning should be led by your "SMART" goals. By approaching your actions through reasonable thinking and realistic measures, action then becomes easily attainable. The premise of this stage in becoming more self-aware is to acknowledge the things that we can do RIGHT NOW! Take the big goal that you are trying to achieve, next break this goal down into mini accomplishments, and finally, plan out the step-by-step process that is needed to accomplish each mini goal. For example, if your big goal is to save up an additional $2,500 by the end of the year, break this down so that each month you meet a personal quota, and each week, you are on track in accomplishing this bigger goal.
If this still seems too broad, stick to monthly objectives! Look at the previous month’s successes and evaluate how you can improve these for the following 30 days. What this exercise can do, in contrast to other strategies, is you can understand in smaller increments over time how your actionable awareness has improved without the extra stress of “sticking to the plan." What is important to remember is that there are always areas for growth, as well as uncontrollable circumstances that could occur. Try not to beat yourself down if you cannot make every goal that you set before. Instead, this is where accountability takes precedence.
One last step in improving our self-awareness is our ability to rely on our personal circles. Our communities, mentors, bosses, friends, and peers around us are part of our success team. These individuals are those who we lean on. The good thing about relationships is we all have them in some form or fashion. The problem is we just don’t ask for help. So how do I build an accountability team? Without going into specific detail of your financial situation, alert these particular individuals of what you are working on achieving. Share with them how you want to grow financially, emotionally, and personally. Invite them into the education you discovered and the planning stages that you previously walked through. Most importantly, share how this new shift in conscious behavior makes you feel! After you have shared what is significant in your life, encourage them to share with you if they have or are experiencing the same. We need support, especially when we are embarking on new things. If we used our relationships and social life to succeed, we may realize that we are not alone and that there are others striving too. You never know; you may inspire someone else in your circle to join in on this new challenge!
Try to steer away from financial advice in these conversations and spend more time on building connections with other like-minded individuals. You build connections by sharing what is important to you and why it is important to you. The key here is to acknowledge that accountability looks different for everyone and everything. Accountability is not about calling one out or putting blame. Accountability is about ensuring commitment and understanding the true weight of a particular responsibility. If you have individuals that you trust and whom you somewhat aspire to, then this helps, for when these individuals do hold you accountable to your actionable goals, you know that it is in love.
If you feel that you do not have a personal circle of individuals that you can trust to be financially and emotionally vulnerable with, build a "hypothetical team." What does this mean? You do not have to be face-to-face to have a connection with others. If there is a role model you admire from afar, include them in your accountability team. The Internet is a great source to find professionals, advisors, and other successful mentors that speak to your personal needs. Find a support group that caters to your personal area of growth. Join a book club that is centered around financial wellness. Relationships do not have to be limited to our surroundings. If anything, the more diverse our relationships become, the bigger our circle of accountability becomes too.
If you are still contemplating if you are financially aware, try asking yourself these questions. First, am I self-aware? This is important because you are the person in charge of your financial potential. Self-awareness could look like practicing sticking to your word or organizing your everyday tasks. If you believe that you could be doing better in these personal areas of growth, try starting here first before moving on to finances. Next, what haven’t I done yet? Many times, there are instances where we have tried certain methods, management apps, or recommended money strategies. This shouldn’t be the end though; the goal is to keep trying until you have found what sticks. Be creative! It may take combining or consolidating multiple strategies until you feel comfortable. Lastly, what is keeping me loyal to my habits? Whether these are good or bad, uncovering why it is hard to break away from certain habits may be the very thing that could require additional education, planning, and accountability along the way to get you to a place of success.
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