Treats and rewards

I’ve just gone 3 months without alcohol.

It’s strange. Alcohol was a big part of my life but now I’ve fallen out of the habit and now seem to be one of those weird “I can take it or leave it” people.

The moral of the story seems to be that you can break just about any bad habit (even one built up over decades) with 1-3 months of cold turkey. After that, you just kinda forget it.

How does this link to financial freedom? Well obviously, it’s cheaper not to drink alcohol (No Shit Sherlock)…and the cost savings will add up and compound over the years.

But this is not about cost savings. Having money means being able to afford alcohol if you want it.  But why did I (used to) want it?

Be careful what you make your reward

Mainly because I had come to see alcohol as my favourite “treat”.

I used alcohol as a “conditional reward”….where I told myself “if I can get through this deal / project / day / week / year / whatever…I will celebrate with drinks. And, in a team environment, there was always other people around to join in.  

I used alcohol as a way to unwind at the end of the week and to mark the achievement of another week of survival in The Prison Camp. So I got myself deeper into the habit of drinking by making alcohol my reward.

I remained functional. But as the years went by the habit grew more entrenched. 

Here is the problem with the “The Treat Mentality”. The framing continually reinforces the value of The Bad Thing (shopping, alcohol, junk food, etc) over The Good Thing (effort, consistency, discipline).

We are always going to want more of the thing that we perceive as our reward. So be careful what you make your reward. It’s best to consciously choose your own rewards (and perhaps use a mix?).

This article goes well with a coffee

The people that make it to financial freedom tend to make the process of saving & investment its own reward over time. They take quiet satisfaction over % savings rates achieved, net worth milestones crossed etc.

By all means celebrate the progress and result. Especially in the early days, you should train yourself like you would train a dog and give yourself a treat for doing The Good Thing.

As James Clear says in Atomic Habits: make it (the good behaviour) as easy and as attractive as possible and link it to an immediate reward.

But eventually the progress should become its own reward. Doing the right thing starts to feel good. The motivation becomes intrinsic. The results and the process of being disciplined become the reward.

This is why many financially independent people end up with a 0% Safe Withdrawal Rate…if you have spent years cultivating the habits of saving and investing, then slamming the gearstick into reverse (de-accumulation in retirement) is an unappealing prospect. Some post FI income means continued progress.

Production vs. consumption

The Treat Mentality glorifies consumption over production. A big part of the financial independence journey is changing the mix of what you get pleasure and satisfaction from.  Imagine a spectrum of 100% consumption at one end and 100% production at the other end.

If you get your pleasure >90% from consumption versus only <10% from production then you end up like a Wall-E scooter person.

If you get your pleasure >90% from production versus only <10% from consumption then you end up as a billionaire / workaholic / monk.

It’s possible to go wrong at either end of the spectrum. But generally, most people need to harden the fuck up and move along the spectrum a little bit away from consumption and towards production.

Or you could show this as a trade-off between hedonism versus discipline:

Source : The excellent Accidental Fire blog

“The worst attitude to have with maintaining discipline is constantly wanting to reward yourself for it” 

AJA Cortes

This is how many people approach cutting back on their spending. They feel they *should* spend less and save more. They will (reluctantly) be disciplined for a relatively short period of time. They might draw up a budget (these don’t last long) or lose some weight (maybe even a lot of weight), they might have a low-spending few weeks.

But at some point, people get the idea in their head that they have been GOOD for long enough, and now they can stop….it’s TREAT TIME.

This is like falling off a greased wagon. It’s as slippery as hell to climb back on the wagon. The weekend off turns into weeks off, and consequently all the progress unravels and they find themselves back where they started.

Why budgets don’t work

This is one reason why I don’t like budgets.

Budgets are like diets or New Years Resolutions : they are things that people say they are going to stick to but then don’t.

If you are serious about saving and investing more, track your spending with total honesty for one month.  You can do this with an app or (better IMO) by downloading all your spending transactions to a spreadsheet at the end of the month.

Tracking for longer is better but let’s start with baby steps. The advantage of the tracking approach is that the process of observation changes the underlying behaviour.

Victory is inevitable

We are playing the long game here. The brutal truth is that getting to financial freedom is going to take blood, sweat and tears. Or if not, then certainly time, effort and mindset changes.

It’s a 10+ year journey where we will have to change almost everything. You will leave behind “treats” and other things that you previously wished to cling to. That is the price we decide to pay (or not).

If you do the the good behaviour – treat – fall off the wagon thing too many times you risk creating a habit of failure…and that is not a good habit to get into. Breaking out of this vicious cycle may require changing your entire mindset.

But the converse also applies. If you get into the habit of doing hard things, you create a habit of success, perseverance and discipline. You can take satisfaction not just from the wins but also from the losses where you played the hand you were dealt as well as you could have.

At that point, victory becomes inevitable.

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  1. I’ve never had a budget, but tend to track for 1-3 months whenever my circumstances change (eg. new job and city) to get a baseline. I’ve always been a natural saver though.

    Good point about weaning ourselves off treats. I think I see food as a reward which isn’t entirely healthy. Part of consumption culture, perhaps.

  2. I think budgets can work at the start of your FI journey, or if you’re in debt and are looking to progress out of it.

    But yes, I think for many well into their FI/FIRE journey budgets are pretty pointless and can serve as a crutch when it comes to withdrawing as you suggested.

  3. Great post dude and THANKS for the highlight…. victory is indeed inevitable!

  4. Pithythoughts · · Reply

    Super helpful article, thanks! Made me think of that saying ‘you are the average of the five people you spend the most time with’, applies strongly to dieting but also to finance I think; I guess that speaks to change your environment as well as your process.

  5. Interesting post. I don’t drink much but am very aware that alcohol is linked to reward and to offset stressful days at work.

    Taking a break from anything is a good way to see how much you depend on it: I’ve been occasionally 36hr fasting one day a week (the Boomtown Rats diet – go ho) and wrote apart from the calorific benefits, there are more subtle ones in terms of regulating appetite and in particular specifically for certain foods (i.e. grehlin).

    I also like the idea of doing impossible things – in our case, it was getting a dozen middle-aged and often overweight dads to complete a self-organised ultramarathon with 60km of trails and 1400m of climb.

    And I’ll be retiring at the end of this year, so plenty of time to look into my own reward system and while I’m not planning on earning per se, I’ll be dipping my toe in the water of financial coaching.

    I don’t do budgets but I know where the money goes and I do deliberate spending. It’ll be interesting to see how that changes next year!

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