Self-awareness and staying engaged

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I liked this part of Jason Kottke’s wrap-up of his first day at Pop-Tech:

Alex Steffen: Cars equipped with displays that show gas mileage, when compared to cars without the mileage display, get better gas mileage. That little bit of knowledge helps the driver drive more economically. More visible energy meter displays in the home have a similar effect…people use less energy when they’re often reminded of how much energy they use. (Perhaps Personal Kyoto could help here as well.) At dinner, we discussed parallels between that and eating. Weighing yourself daily or keep track of everything you eat, and you’ll find yourself eating less. In the same way, using a program like Quicken to track your finances might compel you to spend less, at least in areas of your life where you may be spending too much.

Merlin Mann of 43Folders fame wrote something very similar a while ago, and when I read it, it totally resonated with me:

My theory is that the secret code for most self-improvement systems — from Getting Things Done through Biofeedback and the Atkins diet — is not hard to break; any idea that helps you to become more self-aware can usually help you to reach a goal or affect a favorable solution. That’s pretty much the entire bag of doughnuts right there.

Both of these sentiments are right on. Self-awareness — a mirror that reflects back who you are and what you’re doing — can be enormously helpful for getting you on track to make changes in yourself. This is probably where Quicken had its biggest success, and where it did the most for me personally: showing me what had happened in the past. My experience over time, though, was that it was really hard to stay on track with a change that came from that insight. I felt like I was working for Quicken, not the other way around! Where Quicken falls down, for me and for many of the other people I’ve spoken with, is in two main areas: (1) it takes way too much work to keep it up to date (see my post on “Tamagotchi Software“); and (2) it’s stuck in the past, in two senses, both by being entirely retrospective (“you were broke — you’re still broke — yup, signs point to broke”) and by focusing on the financial needs of twenty years ago (writing checks and balancing checkbooks). Self-awareness is necessary, and great, for any change you want to make. But it’s not sufficient for making a real change in your life.

For me, the secret to making truly useful tools or systems for helping people change lies in combining Jason and Merlin’s insights with Kathy Sierra’s exhortations to “Give users a way to kick ass“:

The key is to have a cycle where the user can keep building their skills to reach higher and higher levels! In other words, the challenge keeps building, but so do the user’s skills and knowledge. The spiral is a continuous cycle of motivation/seduction followed by a period of intense activity toward a goal followed by REACHING that goal which then gives you more skills and knowledge (superpowers, tools, whatever) that let you achieve still higher levels… and on it goes. Five hours later you’re at Level Eight, or skiing bigger moguls, or helping save the world.

It’s very easy to summarize your financial information these days — the tools exist, some credit card companies and banks will even give you an “end of year report” that shows you where you spend your money in pie chart form. That’s a start. Look at that data, and something will probably jump out at you — restaurants, debt, clothes, whatever your particular “biggest slice” is. It’s even easy to start working on that biggest slice. The hard part is getting to the next level — not just going out to eat less for a month or two, but really changing the way you view, and interact with, and take control of your money. What do I do when I’ve gotten the self-awareness, started to make a change — then what? How do I stay on course? I think Kathy’s got the formula right, and we’re doing everything we can to learn from her.

6 Responses to “Self-awareness and staying engaged”

  1. Brian Says:

    I love the ideas and concepts you’re putting forth on this blog – I’m truly excited to see what Wesabe will be. You’re dead on about Quicken, but I can’t imagine how a website can replace it. Or is it even your intention to replace Quicken? I hope at least one aspect of Wesabe will be more comprehensive and easy-to-use personal finance tracking, in addition to community knowledge-sharing.

    What’s the timeline for launch/beta at this point?

  2. Marc Hedlund Says:

    Thanks, Brian! We aren’t out to replace Quicken (we’re looking for much simpler and easier tools, which necessitates leaving out a lot of what they do, and like I say I think they solve a set of problems I don’t believe match today’s needs), but I think you’ll be happy with what we’re working on, given what you say above.

    We’re getting close to launch — I’m holding off naming a particular date since the real date is, “When it’s ready.” But you won’t have to wait long.

    Thanks for the feedback, and I hope what we’re building winds up being what you want.

  3. jolly Says:

    We need shoes with built-in scales and a little LED display to tell us how many ounces/pounds we are putting on with each bite.

    Likewise, we need credit cards with real-time balances on them. e.g, swipe. by charging $50 for that dinner, your new balance is $2050. Oh, and if you look tomorrow, it’s $2051 because interest has accrued!

    Or debit cards that say “your balance was $0, your $2 cup of coffee just cost your $22 because you incurred an overdraft charge!”

  4. Menuka Says:

    On a tangent re: Quicken, I’m trying out this not-so-new product on http://www.mvelopes.com that aims to track your spending vs your plan in real-time to get around that whole ‘dealing with the past’ issue.

    It’s set up so you can go “Oh shit, I’m reaching my morning coffee budget limit for this month, I can either stop buying coffee or forgo my monthly manicure… hmmm”

    I’ve read the blurb and like the idea behind it, too early to say how it’s going in practice as yet.

  5. Sean McManus Says:

    The key to sticking to goals is to use imagination over willpower. There was one piece of goal-tracking software I saw that encouraged you to use a picture of your goal on the front page, so you saw it every day. I can’t say that software worked for me, but I think the idea of visualising the outcome is valid.

    When you find an image that resonates, it’s much easier to stick to a plan. Saving money just because you think you should is hard to do. Saving money so you can visit Australia, or take six months off work, or have the power and resources to cope if made redundant, or be able to afford a house, is much more powerful.

    One of the most powerful images I’ve seen for financial management comes from the book ‘Swimming with piranhas makes you hungry’. It encourages you to work out how much you earn per hour (deducting any expenses incurred for work, like suits and travel). That gives you a time value for money. You can ask yourself, for example, is this meal worth three hours of my life? Because that might be how long you’ll have to work to earn it. That’s a good way to visualise the real meaning of money and also gives you a basis for assessing whether things are good value to you or not.

    Keeping track of progress towards goals is important, but is only truly useful if the goal is well defined and vivid in your imagination, and if you can see yourself getting closer to it.

  6. Marc Hedlund Says:

    Sean,

    I think you’re exactly right. We actually have a feature in Wesabe that keys exactly off this idea — given what you said, I think you might find it interesting, or at least funny. Check it out when we launch.

    Regards,
    Marc

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