How To Outsmart Bad Money Habits

Drawing on key insights from world-renowned psychologists and economists, this article sheds light on how all of us can manage money better.

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It’s all well and good painting a picture of what your future finances will look like if you allocate this much money to supplier costs, or that much cash to your monthly petrol budget; but seeing as we can’t actually tell what the future holds, we have to prepare for all possible outcomes (in other words, we need to expect the unexpected).

Bill Murray does an excellent job in emphasising the importance of preparation in the 2015 film Aloha, where his character states “the future is not something that happens; it’s a brutal force with a great sense of humour that will steamroll you if you’re not watching”1.

With that in mind, here are some tips on how you can outsmart yourself when it comes to bad money habits.


#1 Plan for Procrastination

68% of people say they should save more for retirement, with the key word being should 2. One main culprit responsible for the discrepancy between ‘should’ and ‘do’ is procrastination. As David McRaney explains in You Are Not So Smart, “procrastination is all about choosing want over should because you don’t have a plan for those times when you can expect to be tempted”3. Whether it’s money, dieting or your TV shows watch list, we’re all guilty in some way or another for planning to do one thing, and then doing something else when the time comes.


The easiest way to overcome procrastination is to not only plan, but to plan for future you.


To make matters worse, we humans have a bad habit of romanticising our behaviour in order to maintain a positive self-image. We’ll all sing the same chime of “I procrastinate sometimes, but I’m not as bad as others” when, in reality, almost every one of us is prone to (a) lying to ourselves, and (b) something McRaney refers to as “present bias”. Present bias is, in summary, the inability to recognise that what you want in the present isn’t necessarily what you’ll want later: “there is the you who sits there now reading this, and there is the you some time in the future who will be influenced by a different set of ideas and desires” (You Are Not So Smart, McRaney).

So, with that in mind, how do you beat … yourself? The easiest way to overcome procrastination is to not only plan, but to plan for future you. Instead of convincing yourself that you’ll be able to resist the cake at your cousin’s wedding next weekend (when you know historically that your willpower has not been so strong), take into consideration that the future you, standing before a multi-tiered frosted cake surrounded by people eating happily, is going to find it much harder to resist once it’s in front of you. Rather than waiting for the new year to start putting money into an ISA, recognise that beginning your savings today means having more tomorrow. Accept that later eventually becomes now and imagine what the future you might wish the present you did differently.


How SlideBy helps you prepare for procrastination

Creating a cash flow forecast in SlideBy isn’t nearly as tedious as you think. In fact, let’s do it together, right now:


Step 1:  Download and setup the SlideBy app (see link at the bottom). Done in 3 minutes – easy.

Step 2:  Add the things you know you have to pay for soon (be it in the next couple of weeks, days or even hours) in today’s column as invoices. Check out our video showing you how to do this in under 90 seconds here.

Step 3:  If you’re not keen on paying for something today, drag and drop the value onto a different date to delay the transaction (click here to watch how you can slide to delay).


And there you have it – you’ve just created a cash flow forecast in record time and without procrastinating. Nice one!


#2 Understand Feedback

You probably have an idea of what your bad money habits already are and, if you don’t (or even if you do), you can assess what they are using feedback – a simple practice Thaler and Sunstein outline in Nudge as one method for improving general decision-making. Put simply, feedback is the compiling and disclosing of results and/or evidence.

Notice how, in my wedding cake example, I used the word “historically” – now how much history do you think we, the collective human race, would know and understand today if the events of the past were never documented? Feedback is not only pivotal to our common knowledge about the world today, it is also a crucial step in gaining an understanding of ourselves.

Recording your transactions is a common method for gathering financial feedback. However, it’s not enough to just document your money movements; it’s also not enough to scrutinise stats and flashy infographics that quantify your behaviours.

For feedback to become valuable, it has to be translated into units that you find easiest to absorb. This process is called ‘mapping’ and simply means bringing something abstract into focus by transforming it into information that you can relate to more easily.

Let’s say that you’re in the habit of purchasing a coffee for £3.15 from your favourite café every morning on the way to your office job. You might already be aware that £3.15 per day adds up to (give or take) £800 per year, but you decided it’s a price worth paying for an experience you enjoy each day. Now let’s say you’ve received an £800 tax refund from HMRC. Given two options, would you rather put the money aside to pay for your coffee each day for a whole year, or book a 5-star all-inclusive holiday abroad?

If you’re like most people, you would choose to book the holiday. Why? Because (1) it’s money you didn’t have a plan for (we’ll come back to this), and (2) people have no issue in recognising that they want the greater reward but find it difficult to map small actions and decisions to the ultimate consequence of achieving it. The struggle with bad money habits isn’t so much about what we spend our money on, but rather the difficulty we have in translating the cost of a daily coffee into a luxury holiday.


How SlideBy helps you understand feedback:

SlideBy allows you to see the past, present and future state of your bank balance. Not only can you add recurring incoming and outgoing transactions to your cash flow forecast, you can define how often they occur and see how they’ll impact your balance days, weeks and months in advance. Regular payments usually include salary, bills, direct debits, supplier fees and, yes, even the coffees if you’re looking for an honest projection.

Once you’re all setup on SlideBy and ready to see how well you behave financially, your feedback is ready and mapped, too: it’s your future bank balance, and you can see it by simply sliding to the right. Instant, real-time feedback is just one of many ways SlideBy helps you understand and monetise your spending habits.

If the language is money, I think it’s safe to say that we all at least understand it. With SlideBy, there’s no abstract concept to translate, no accounting skills needed and no more guesses.


#3 Delay Gratification

Another reason why we delay what we should do (i.e. considering putting that £800 aside for that daily coffee you love so much) is because we seek instant gratification4. Craving immediacy is a symptom of living in the modern age of ready meals, next-day deliveries and, of course, the internet. Not only do we want everything – we want everything now. In fact, we’re so impatient that, when “faced with two possible rewards, you are more likely to take the one that you can enjoy now over one you will enjoy later — even if the later reward is far greater” (Nudge, Thaler and Sunstein). So why are we like this, and how can we learn to be more patient?

One widely accepted psychological theory is that, when we are tasked with making a decision, our brain engages via two systems: ‘system 1’ and ‘system 2’. ‘System 1’ refers to the part of you which is emotional, impulsive and fast; it’s the part of your brain that tells you to order the pizza, buy the shoes and that thinks you’re going to die when you feel turbulence on a plane. ‘System 2’, in contrast, is logical, calculating and slow; it says “don’t order pizza, you have food in the fridge”, “you don’t need more shoes – save the money!” and “it’s unlikely you’ll die, planes are safer than cars”. ‘System 1’ represents your initial reaction and ‘system 2’ follows, often cooling down the hot, speedy nature of its quicker counterpart5.


Stress plays a large role in accentuating ‘system 1’: when we’re feeling the pressures of finances, we have a tendency to splurge in an attempt to nurture our wounded ego.


Whereas ‘system 1’ isn’t concerned with taking a moment to think something through or with long-term consequences, ‘system 2’ is “crucial for future-orientated decisions and self-control efforts”; in other words, ‘system 1’ isn’t qualified to help us improve long-term money decisions. As one system becomes more active, the other becomes less active, meaning the more you indulge ‘system 2’ by rationalising and slowing down your decision-making, the easier it becomes to do so – ultimately leading to greater willpower6. Put simply, the best way to improve your ability to delay gratification is to delay gratification.


How Slide helps you delay gratification:

Stress plays a large role in accentuating ‘system 1’: when we’re feeling the pressures of finances, we have a tendency to splurge in an attempt to nurture our wounded ego.

SlideBy alleviates the stress that accompanies cash flow management by automating accounting activities; it turns payment entries into bookkeeping records by entering them into the purchase ledger of your chosen accountancy system (be it Xero, QuickBooks etc.) and turns 3 tasks into 1. With your future balance in plain sight and payments entering made easy, there’s less room for stress when you’re using SlideBy.

Our top tip on delaying buying what you want over what you need is to practice the “if-then” strategy, which involves consciously pairing a situational cue to a desired action. For example: “if I have a surplus at the end of the month, then I will invest 50% of it into my savings” or “if I decide to redesign the office, then I will stick to a pre-defined budget”. Not only are “if-then” strategies proven to be highly effective in helping you develop a new habit (see here for an in-depth article), they become automatic responses that subdue the urges of ‘system 1’ when practised and used in the right context.

Oh wait, there’s a bonus: with SlideBy, you can see the “if” before it happens (… did we mention that already?). If you foresee a surplus or are alerted of an unexpected upcoming payment, you have more time to think, more time to plan and more time to take action (ergo more time to consult ‘system 2’). After all, timing is everything.


One More Thing …

If you’re looking to employ good money habits for your personal financing, you probably have the time to work on perfecting these behaviours to ensure they solidify as habits. If you’ve got a business to keep afloat, you may not have that luxury; this is where SlideBy comes in.

Whether it’s business or personal, a team or a one-man (or -woman) operation, SlideBy enables its users to take the first step in adopting positive cash flow management habits by allowing them to take control of the future of their bank balance. Using the power of open banking, SlideBy works by reconciling your bank account and financial records, centralising your cash flow overview and allowing you to accurately forecast all in one app. It’s connected, it’s accurate, it’s intuitive and, best of all, it’s free!


Download SlideBy for free on your iPhone and iPad from the App Store today.



  1. Aloha (2015) [online] directed by Cameron Crowe. USA: RatPac Entertainment [viewed 07 August 2019]. Available from Amazon Prime.
  2. Thaler, R.H. and Sunstein, C.R. (2008) Nudge: Improving Decisions About Health, Wealth and Happiness. Michigan, USA: Caravan
  3. McRaney, D. (2012) You Are Not So Smart: Why Your Memory Is Mostly Fiction, Why You Have Too Many Friends on Facebook and 46 Other Ways You’re Deluding Oxford: Oneworld Publications
  4. Partnoy, F. (2012) Wait: The Useful Art of Procrastination. London: Profile Books
  5. Kahneman, D. (2011) Thinking, Fast and Slow. London: Penguin
  6. Mischel, W. (2014) The Marshmallow Test: Understanding Self-control and How To Master It Paperback. London: Transworld

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