Oops! Fixing Money Mistakes

We all make mistakes now again when managing our money because, hey, nobody’s perfect (well . . . except maybe Harry Styles but that has more to do with his voice and his hair than any financial skills he might possess). Whether it’s over-drawing your checking account or spending a little too much cash during that night out, we all slip up occasionally. It can be tempting, and frankly easier, to just sweep these errors under the rug. If you don’t acknowledge the problem, it’s like it never happened, right?

WRONG! The key to getting your budget back on track is not to close your eyes tightly and hope the mistakes disappear; instead, try to identify where you went wrong as soon as you discover the error. I came across the following passage in a book recently that sums it up perfectly:

“Tip # 22: Pay Attention Immediately After You Make a Mistake. Most of us are allergic to mistakes. When we make one, our every instinct urges us to look away, ignore it, and pretend it didn’t happen. This is not good because as we’ve seen, mistakes are our guideposts for improvement. Brain-scan studies reveal a vital instant, 0.25 seconds after a mistake is made, in which people do one of two things – they look hard at the mistake or they ignore it. People who pay deeper attention to a mistake learn significantly more than those who ignore it.

Develop the habit of attending to your errors right away. Don’t wince, don’t close your eyes; look straight at them and see what really happened, and ask yourself what you can do next to improve. Take mistakes seriously, but never personally.”

– Daniel Coyle, The Little Book of Talent

So the next time you make a mistake with your money, don’t just brush it off. Identify the mistake right away. Why did you overspend? On what? What made your account go into the negative? And then, figure out how you’re going to stop it from happening again. Maybe you need to adjust your budget or just check your balance on your mobile app before you make a purchase. Use your mistake as a tool to do better in the future.

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