You Are Your Own Worst Enemy

The human race is a very interesting one.  The past few centuries of our existence have produced massive leaps in the areas of technology and exploration.  Just a few decades ago not many people had computers or cell phones.  Despite all of this progress, there are still dark things that always occur.  Violence, war and intolerance to name a few.  These have all taken on different forms in different eras but that self destructive nature is always there.  We are a true dichotomy and probably always will be.

These self destructive habits can be found in our individual lives and habits as well.  In our never ending quest for comfort, people still smoke and eat poorly despite knowing the harmful effects to our body.  We avoid doing things we know will be beneficial for us, while choosing things that are easier to do but may not be good for us in the long run.  While these individual flaws don’t have a global effect like wars and violence do, they can be minimized in the same way.

Society sets laws to limit our destructive habits.  For whatever reason, many people resort to things like theft and violence to get what they want.  Laws were created to prevent this and while they don’t eliminate it completely, it greatly reduces the amount of crimes that occur.  We all follow some types of law, be they religious or secular.  For the most part, they are there for our own good and for the good of society.  In essence, laws prevent us from making bad choices that we might have made if left to our own devices.

This same idea can be applied in order to improve our financial lives as well.  Most people commit a financial “crime” at some point.  Spending a little more than we would have liked on the coffee run.  Going out for an overpriced dinner while cooking at home would have been much cheaper and just as tasty.  Not contributing to our 401k plan because we need all the money we can get in order to pay the credit card minimums.  We know actions like these are not good for our financial health, but they end up happening anyway to a lot of people.  But just as society can set laws to keep the crime rate down, we can set some laws of our own to keep financial crimes from happening.  The two best laws to help us financially: setting up automatic transfers and creating a spending plan.

Automatic transfers:  The best thing to come from being able to bank online is the ability to easily transfer funds from one account to another.  It’s so easy to do and is the single best way to prevent financial crimes from occurring.  Why?  Because it takes the decision out of your hands.  By having a set amount of money transferred from your checking account before you ever get a chance to spend it, you’re taking away the potential of doing something stupid with that money.  Part of your earnings need to be earmarked for savings and investment.  Instead of stressing about how much you have left over to contribute to your savings, set a comfortable amount to be taken every month so you don’t have to worry about it.

We all need to have something saved for the future and the best thing to do is save early and often.  That means contributing as much as you can to your retirement account as soon as you can.  For those who can participate in a 401k plan through their employer, this is best done with deductions from your paycheck straight into your retirement account.  You won’t even have a chance to miss the money.  This is key since most people don’t like getting less money in each paycheck. If you start early and have it deducted automatically, you have to find way to make do with what you get.  In my own personal situation, the ability to automatically transfer money from my checking account into my savings and 401k has been the best thing I have ever done for my finances.

Spending plan:  The second way to keep yourself from committing a financial crime is to set a spending plan.  This can also be called a budget, but spending plan sounds cooler.  It’s really very simple.  Just take a look at how you spent your money the last 6 months or so.  The longer time period you analyze the more exact you can get, but 6 months will give you a good overview of how you’re spending your money.  Divide it up into categories and look at where you feel you’ve been spending too much.  This is where personal finance gets personal as everyone has different tolerances.  Some people love food and don’t mind spending a lot on eating out.  Others like a strong cell phone plan and will gladly pay for it.

The key is to optimize your spending.  Spend what you like (within reason) on what you value and cut what you don’t.  This takes a few minutes of thought but it will have a profound effect on your finances.  You can then set up estimates on how much you want to spend in each category and try to stay within those values.  The goal is not to hit that exact dollar amount every month, but to recognize where you’re spending your money and shift it to where you want.  Any money you save from those things not so important to you can be sent to your savings and investment accounts.  Knowing really is half the battle.

These are two of the best ways to hack your finances and keep yourself from making a costly mistake.  There are many financial “laws” you can set to protect yourself against yourself, so just experiment around and find what works the best.



  1. So True. Automatic transfers help me a lot with savings. From time to time we may adjust them, but it is nice to know all we have to do is set it up one time and keep money coming into the bank account.

    • Syed says

      Exactly right. Automatic transfers are something so easy everyone can do to jump start their finances.

  2. I think at the end of the day, you want to make sure your spending reflects the things you truly value.

    • Syed says

      Very true. A problem is that many haven’t sat down and thought about what they really value and instead let society dictate that.

  3. I think you’re hitting the nail on this one. The simple reality is that our minds aren’t necessarily made for saving money. Spending it acknowledges our very short existence, and I think that feeling of the temporary pushes people to spend now — think about saving later. Creating automatic saving plans are a great option; although, I’m not sure they’re enough if inflation is removing most of the earnings.

    • Syed says

      You’re exactly right it does take some mental training to be able to focus on saving for a long term goal. As far as inflation removing most of your earnings, that would be true if you put all your money into a savings account. But you can also automatically transfer into an investment accounts via paycheck deductions or automatic deposits into an IRA or brokerage account for example. Anything that can take the decision out of your hands is the key. Thanks for the great comment.

  4. I am trying more and more to spend on what is important to me and save on what isn’t. Of course there are always necessities that aren’t necessarily something that is important to me (toilet paper, haha) but maximizing my spending by focusing on those things that are make a huge difference. Automatic savings definitely work for me!

    • Syed says

      Yup there are definitely things everyone needs like food and toilet paper. It’s the stuff that comes after the necessities that people get into trouble with.


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