Freeze your credit cards in a block of ice and keep them in the freezer.
Don't take any cash or credit cards with you when you go out.
Write down everything you buy.
These are the kinds of tips given to people looking to keep themselves from spending money they shouldn't. Whether you're trying to stick to a budget, really can't afford the things you're buying or suffer from compulsive shopping disorders or addictions, temptations abound.
But even people who can afford to pay off their credit cards every month and have healthy bank accounts face temptation. And they don't always make the right choice for the long-term financial goals they have set for themselves. They may use a bonus from work to pay for an expensive vacation when they know they should put it in their retirement or college fund as planned. They may try to squelch their desire for an exotic trip by settling for a weekend getaway to a nearby city instead.
What these techniques have in common is that they focus on strengthening your willpower to resist financial temptation. While we may try to rely on willpower to stem the desire to overspend, we know we can't always count on it. Anyone who has tried-and failed-to pass on dessert while dining out knows that! We all have times when our willpower fail us. Willpower is hardly a reliable resource when we really need to control something in our lives. Yet, despite its limitations, willpower has been our society's one and only go-to resource for self-control. If willpower fails, we are admonished to just try harder.
Given the limits of willpower, some psychology professors at Northeastern University began thinking about alternatives. Might experiencing certain emotions help curb our desire for the short-term gratification that comes from spending money? In particular, David DeSteno and his colleagues wanted to find out what role gratitude might play in squelching the desire to spend money.
DeSteno writes about the study in a recent Harvard Business Review blog, Gratitude Is the New Willpower. He and his colleagues designed an experiment that asked participants 27 questions designed to determine their willingness to give up immediate gratification for a bigger pay-off later. But before asking the 75 participants questions such as, Would you choose to receive $54 now or $80 in 30 days? the researchers first randomly assigned each participant to recall an event from their past that made them feel grateful, happy or neutral.
The researchers expected those assigned to recall a neutral or happy time to prefer the immediate payout. But what they discovered instead was that those who were asked to remember an event that made them feel grateful were more willing to forgo the immediate cash. Even more interesting, the amount the participants were willing to forego increased with the degree of gratitude they reported feeling.
The researchers concluded that "gratitude reduces excessive economic impatience," adding that their study challenges the belief that people have just one resource to quell their impulses, namely shoring up their willpower. Willpower can and does fail, often with disastrous consequences.
One of my main goals as a wealth manager is to help clients use their money to create their best life. If they define their best life as one which includes that exotic vacation, then that is money well spent. But if a client is saving money to start his own business, needs to put a certain amount of money aside each month to meet that goal and knows he can't make it if he splurges on vacations, then he needs to find an effective way to ease his economic impatience.
DeSteno and his colleagues' research suggests that if we shift our focus from willpower to gratitude, we can tap into a powerful and yes, perhaps even unlimited resource. When we feel grateful for what we have, we can recognize that we are all richer than we think. What a lovely echo to the words of Eckhart Tolle, "Acknowledging the good that you already have in your life is the foundation for all abundance."
David Geller is the author of Wealth and Happiness: Using Your Wealth to Create a Better Life. He is the CEO of Atlanta-based GV Financial Advisors and is available for professional speaking engagements.