September 24, 2016

Lee Roesner: Why You Can’t Improve Your Money Management Skills

We’re not talking strategic investment decisions here, just your everyday personal cash flow management. You know — all that stuff you do to maintain some sense of control over the money moving in and out of your life. If you’ve been doing it for a while, have you ever questioned why your productivity level seems stagnated — regardless of the amount of time and effort you may put in every week for months and even years?

At first you might think you’re getting better. But for the sake of comparison, let’s consider putting that same time and effort into practicing the piano. Would your skill level in each be comparable after practicing these tasks for a few hours every week, say, over a few months’ time? Maybe.

Let’s extend that time period to a year. What would you be accomplishing on the piano now compared to your money management efforts? What about five years down the road? By this point you could easily be performing wonders on stage with that piano.

How’s your money management skill and productivity level doing? Are you still tracking that loose change on your mobile app after every cup of coffee you buy? At this point you may realize that no matter how many more years of time and effort you put into “practicing” money management, your skill level and productivity will never comparatively improve.

There’s only one reason your personal money management proficiency and productivity stalled long ago but your piano playing skills continue to soar higher.

Figuratively and literally speaking, when first learning to play the piano (like learning money management), you have to first map out where all the notes are on the keyboard (where all the money is in your life), to gain an understanding before you can begin to play your first two-finger tune (actually start making money management decisions). But here, is where your money management skills get left behind and your piano playing skills break out.

Without a second thought, when playing that piano the second time, you’d take for granted the fact that all the notes on the keyboard were in the same place they were the first time. So quite naturally, with “practice” (doing the same thing over and over—an important distinction), you’re able remember the position of the notes and move on to the next level and practice managing those notes into the true skill-building part of actually playing a song.

In contrast, when managing your money the second time, you have to first figure out where all your notes are again (timeframes, income, expenditures, balances…) because they’ve all changed position since the last time you “practiced.” It’s at this point you might realize, the only thing you’re practicing, is finding notes.

The reality is, if you keep managing your money this way, you’ll have an entirely new keyboard arrangement (financial picture) in front of you every single time. So in essence, you’re starting over every single time. This is the reason you can’t improve your money management skills to the same degree you can improve your piano playing skills.

Let’s turn this concept around, and now ask yourself, after five years, how good you would be at playing that same simple song on that piano, if every time you sat down to play it, you had to first figure out where all the notes were? Maybe you recognized that problem early on so you decided to employ the latest high-tech note-finding software. But how’s your skill level at actually playing that song? Improving? How about five years from now?

You’d might come to realize that no matter how well you mastered your note-finding abilities, your performance threshold has never really gotten off the ground–and will never get off the ground, because your understanding, knowledge and wisdom of the keyboard (your financial picture) will always be limited because it’s never the same.

But now consider what might happen to the whole concept of money management if your money (timeframes, income, expenditures, balances…) stayed in the exact same position you left them the last time…and the time before that. To get a real good idea of what that experience might be like, just consider what happens to a musician as his skill level grows at playing that piano.

Consider for a fact that it doesn’t take long for a musician to stop thinking about the notes on the keyboard entirely (can you imagine?). The musician’s initial time and effort to “account” for the notes (pun definitely intended) has naturally advanced to the organization and management of the notes (song playing/money management). With time, through simple repetition and memory, his song playing grows more intricate and precise, while the ease and effort at playing them becomes more elementary. His knowledge of the keyboard has moved into a completely intuitive state (invisible?) and he’s now operating at a level of mastery, accomplishing so much more with only the slightest of effort.

Thousands of people, performing a thousand different activities, are reaching mastery level everyday. If you’re already investing time in managing your money, there’s only one reason you can’t reach mastery level…you’re mistaking note counting for money management.

All this talk about music get’s me creative…let’s see:

What financial masterpieces
Could you be performing
With effortless skill
And pleasure and delights
If all your notes
Were in the same place
Just Twice

Lee Roesner is a business owner, entrepreneur and developer of MoneySlinger™ Speed-Budgeting™ Personal Finance System. This article was originally published on MoneySlinger.com

Image: graur razvan ionut / FreeDigitalPhotos.net