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Harness The Power Of Habits

A dictionary will tell you that a habit is a settled or regular tendency or practice, especially one that is hard to give up.

Good habits are obviously good for you, while bad habits…well, not as good.

Some habits are harmless, while others can cause a lot of trouble. But how can you harness the power of good habits to improve your life?

‘Living on credit, is an expensive and bad habit’

Living on credit, is an expensive and bad habit. But taking steps to get out of debt and paying off your debt, is a good habit. most people find that making that change can be difficult, and nobody likes change.

Starting debt review and switching to a no credit, all cash lifestyle can be really challenging. So, how can you make debt review a part of your regular habits and overcome the initial reluctance to change?

Let’s see what scientists say about forming new habits.

No One Likes Change, At First

Change is often scary.

Think back to the classic example of the first day of school. Oh, the trauma! We had to leave our safe routine, or safe home, our parent and go to a scary place full of strangers.

This is often how we view change as an adult. It takes us out of our comfort zone and puts us in a scary place.

Even small changes can seem disproportionately difficult. This is because we struggle to realise that change can bring out the best in us, and change our lives for the better.

When we look back and analyse how a change in circumstances or life affected us, we are often happy with the results. We feel like we have grown because of the change we made.  Nevertheless, in that moment just before things change, it can be scary.

Clear Motivation is Important.

There is something that can help ease our fears and it really is quite simple.

If we understand why the change is needed and what the new situation will be like, it makes us feel reassured and more confident.

You may have thought about changing your diet over the years. This may have been because you want to save the planet, or shed a few centimetres. But no doubt, you found it hard to do over time. Such a diet might be easy to start but hard to maintain.

Having a very clear picture of the reason for the change can help you stay motivated.

For example, you may be more prepared to change your diet if a doctor tells you that if you don’t, you will die. That would certainly be a good reason to make the change and keep it up.

Motivation matters.

Keep it Simple

A 2009 research study in the U.K. found that simple healthy habits, such as: eating more fruit with your lunch or going for a 15-minute run each day, took an average of 66 days to form.

More complicated or challenging habits can take even longer.

One way to form a habit, is to make it a simple, regular part of our day or month. It can also be good to build towards a long-term habit.

For example, you may struggle to run 10-km each day, but going for an afternoon walk, every day, will help you build towards the long term habit of regular exercise.


Increase your Chances of Success

Eliminating the chances of making decisions that could tempt you off your desired path, can also be helpful.  Limit your chances of failure.

For example: If you want to cook healthier meals, fill your fridge with fresh produce, not sweets.

Avoiding social media that makes you envious of others “rich” lifestyle can help you avoid FOMO.

Unsubscribing from some emailers (from expensive shops) can help you avoid seeing stuff you can’t afford.

Installing apps like TrueCaller can help you avoid wasted conversations with greedy collections agents who might lie to you or mislead you (due to being underinformed or lack of training)

If you want to read a book each night before bed, rather than scrolling through social media, then put a book next to your bed, and put the phone charging cable far away across the room.

Increase your chances of success.

Make It Fun

New habits are easier to form if we give ourself a little instant gratification to go with it.

Budgeting and having a family evening where you discuss your finances can be boring and stressful.

So, why not combine it with the best meal of the month? The most fun meal of the week, or make it a small part of a fun weekend each month. Why not keep the discussion brief, rather than long and boring, follow it up with movie night or something else nice. Maybe enjoy a dessert treat while you are budgeting.

Maybe you go treat yourself to that milkshake right after you make that debt review payment each month.

If you can combine something new with something fun it can really help.

The 90 day Habit of Debt Review

Entering debt review can be very scary.

Still, we can very clearly understand the need for entering the process. It is often because we are forced into the process. Our finances are in a mess and things are just getting worse and worse. Soon we would face judgements and maybe even lose our assets if we don’t do something drastic.

When those horrible collections calls and scary sms or letters are pouring in, it can be very motivating. But it can help to look even deeper into our views on money, instant gratification, self-worth and our views on debt.

Entering debt review can actually be exciting because we realise that we can not only get relief, but eventually get out of debt, amazing!

Signing up and sending in all the documents is not too difficult. But finding out what you will now have to pay can be a challenge, as it makes you rethink your shopping and spending habits.

We need to get into the practice of debt review if we want to succeed.

The First 30 Days

Well, done. You pulled the trigger and have started the process.

Sending in forms and communicating with your Debt Counsellor can help keep you calm during this wild time of transition.

There can be a bit of a scramble to change banking info or cancel debit orders. This is a big change but it keeps us busy and makes us feel like we are making progress.

The real test comes at the end of the first month when you have to make your payment (probably via a Payment Distribution Agent like CollectNet, DC Partner, Hyphen PDA or iPDA).

It’s a big change.

The Next 30 Days

During the second month you are going to start longing for your credit card.  You are now being forced to think about how you shop and spend, it’s difficult.

Also, you may now get one or two weird messages from a collections person who does not know about, or understand debt review. You may notice that your bank statements show no payments coming in (because you paid your Debt Counsellors fees in month one). That can feel a little worrying.

Incorrect stories by greedy collections people, incorrect information from friends or Facebook can make you doubt the process, even though you have just begun. This is where many people very foolishly drop out of the process, causing themselves a ton of problems for years to come, this is a really a dangerous time.

Like many good habits, things feel hard at first. Going shopping without your credit card or paying your bills without running to get another loan can be such a different way of life, it can feel overwhelming.

At the end of the month, you now pay your legal fees which helps you get legal protection and organise your court order restructuring your debts. This is very important and can make you feel like you have made more progress, helping you stay focused.

You may have found yourself dealing more with your attorney this month than your Debt Counsellor. They were chasing you to sign and return the all-important confirmatory affidavit (Please do, it is vital).

You are getting into the swing of things, debt review has almost become a habit, almost.

Getting to 90 Days

Month 3 is tough…

You speak to your Debt Counsellor less, you speak to your Attorney less. You have now been shopping with cash (or your debit card) for a long time and you start to see adverts for things you just can’t afford or can’t simply buy with credit any more. Your friends are inviting you to go to places you are not sure your budget can cover.

The reality of your changed circumstances can come crashing in, as you realise you are now going to be paying off your debt and living frugally for many years. Eeek.

Even though the truth is you already had big debts that would have taken years to pay off anyway it can feel different. Once you get your court order and see things in the harsh light of day, you may have some “buyer’s remorse”.

‘you may have some “buyer’s remorse”’

And if along the way you see your balances go up (maybe because the banks have not adjusted their systems nicely yet, or simply because you have paid the Debt Counsellors fee in month one and Attorneys’ fees month two) it can be stressful. You worry.

It is at this point that you need to really dig deep and push through the doubt. Make that third payment and keep your momentum going.


Stay On Target

Having passed the 3-month mark, you are now more likely to keep going.

You are already doing better than nearly 20% of people who start the process, but bomb out during the first 3 months.

Simple health habits like washing your hands can take a couple of weeks to develop, while more complicated ones like going to the gym can take much longer to become deeply entrenched in your regular routine.

That’s because more complicated things take longer to get deeply embedded in our way of thinking. And being determined to pay off our debts no matter what can take 3 months…or more to get used to.

Tips For Success

Here are some Tips to make anything a lasting habit

Simplify the process

Repeat it often

Find ways to make it fun

Set realistic expectations about how long it will take to establish the habit

Habits develop quicker the more often they are repeated

Expect It To Be Hard

Starting a new habit, like living on cash and always paying our debts at the end of every month, prompts your brain to cycle through a state of:  order, disorder and reorder, which is also known as allostasis.

This is what leads us to feel worse before we feel better. We have to get through the change, then the disorder to make it back to the order part.

For example,  starting a new gym habit can mean sore muscles, hunger and fatigue before we eventually start to feel the benefits, and adjust to the new routine. 

One expert says: “If you don’t expect it to be hard, then when it is hard you freak out and you quit.”

We expect good habits to make us feel better (maybe more energetic, or stronger or calmer) but those feelings don’t often come right away.

It’s the same with debt review. At first it might surprise us how hard it can be, it’s only later, looking back that we clearly see the benefits.

Good Habits Are Hard To Break

It might feel like good habits are hard to form, they are. But the good news is that once formed, they are also hard to break.

So, if you want to make living a debt free life a good habit, if you want to make dealing with debt successfully a habit, if you want to make financial freedom a habit then, it’s going to take time to get into the routine of living that way.

Why not try it for 3 months and see how it goes?

Try some of the tips above to help you form new positive habits?

Push through the difficult times and you will see the benefits that come from forming good habits.