At various times throughout my life including the present, I’ve been guilty of having attitudes that could be damaging to my hopes for financial independence. I am generally a laid-back person, and my lack of what can be called “urgency” has certainly damaged my corporate ladder-climbing options. Although I’m fine with that, and I have found ways to build my own ladder, I can understand how something like that can be frustrating.
In school, I was able to achieve highly relative to my peers without stressing much over my work. That might have given me the illusion that my achievement was due mainly to skill rather than effort — the stable side of attribution. I later learned that would only take me so far, and excellence on a scale larger than my high school — or the set of all high-school aged clarinet players in the state of New Jersey — or working for a living on major projects — required much more than the token effort I was used to using.
Nevertheless, I managed to avoid stress. Until recently, I didn’t let bad situations affect me personally. I saw the urgency around me as mostly a show. I used to work in a corporate environment, in the back-office financial area. Once in a while we had urgent projects to deal with, but for the most part, it wasn’t an incredible busy job. Having come from a non-profit consisting of only ten or so people working on major, nationwide projects for which we needed five times as many people as we had, it was hard for me to take a lot of the false urgency seriously. Yet I saw around me a culture where if you leave your desk, you have to walk quickly, as if you’re on a mission to save a life.
I eventually transferred to a different department within the company, as did many others who were working for the same supervisor. I later talked to a co-worker who had done the same, and she had been one of those who took on this sense of full-time urgency in her work, regardless of how meaningless to the world it was (and all of our work was). As we were talking about our former boss, she mentioned it was her first corporate job, and she was only acting in this way because she thought it’s how you’re supposed to act in an office setting.
But I took it to the extreme. Not only did I refuse to let work stress me and scoff at the idea of false sense of urgency, I tended to procrastinate. If there was a deadline, I often waited until the last minute, always keeping my faith that I can get what I need to do done within the limits of time. Sometimes I was right, and sometimes I was wrong.
Procrastination is a problem. For some, putting a task off for the future is a way of avoiding pressure or normalizing stress over time. Sometimes procrastination is a result of not knowing where to start. People put off a project because they’d rather it be perfect some time in the future than less than perfect today.
While you might put off cleaning the house until the hour before guests arrive and not suffer any consequences down the road, dealing with your money situation has to begin as soon as possible. While there’s a chance that you could suffer devastating financial consequences if you don’t deal with problems before they grow, even small delays can eat away at your wealth thanks to the amplification effect of inflation.
I can’t just say I wish I had known more about managing my money when I was a teenager. It’s true I’d probably be in a better financial situation today, all other things being equal, had I begun to save money years before I did, but this isn’t a message that encourages people to start something they’re not ready to handle, like the personal responsibility of managing the future. If I were to talk to a teenager to encourage her to start thinking about building financial skills today, I could relate it to her desires, like perhaps buying a car or paying for college, but it’s still going to fall mostly on deaf ears, as we’ve seen from previous attempts to add money management classes to the high school curriculum.
Parents and leaders in the community have the responsibility for modeling good financial behavior, and encouraging examples of good financial behavior among teenagers and young adults. Part of this good behavior is starting to, at the very least, increase awareness of the role of money in life. For the most part, kids shouldn’t need to worry about adult concerns, and spend the limited years before adulthood as kids, but the danger arises when the attitude of holding onto childish things continues into adulthood.
When that happens, you end up with dangerous attitudes:
- There will be time to save for retirement later.
- I’ll be able to pay off today’s debt when I finally get a better paying job.
- Health insurance is for old and sick people.
- I can spend eight hours a day playing video games.
- I’ll start worrying about a house down payment when I start a family.
There are two main financial problems with this philosophy. First, it’s more than likely time will run out before you properly prepare for whatever future financial need you might have. Second, you can do much better with more time on your side.
If you start saving for retirement by age 18, you could retire with hundreds of thousands of dollars more than if you start saving at age 35, even if you save much more money each year starting at age 35. The early bird really does get the worm thanks to compounding interest and compounding returns.
Not knowing where to start is not a good enough excuse for delaying. Three things to get you started are relatively simple.
- Start tracking your money to understand where it goes and where it comes from.
- Open a high-yield savings account.
- Use Consumerism Commentary as a reference for all things financial.
You don’t need to be as passionate about personal finance as we are in order to get started now. You just need to understand the consequences of delay. If you wait, you may never be able to retire or leave the type of job where you don’t want to work. If you procrastinate, you will miss opportunities for financial growth. If you don’t start putting in a little bit of effort today, it could take a lot of effort in the future to support your family.
You should feel a sense of urgency and a little bit of stress to move your finances in the right direction.
Putting off managing your finances until the future is one toxic attitude of many I’m discussing. The first was blaming others or the world for your situation. What tips do you have for discouraging financial procrastination?
Published or updated November 30, 2012.