Set Boundaries to Achieve Financial Goals

Research indicates that one of the best ways to stick with goals is to set boundaries. In other words, draw a “line in the sand” and develop personal policies to help say “no,” resist temptation, and stay on course.

One way to set boundaries is to change your response to inevitable temptations. According to research cited by productivity expert James Clear, the words “I don’t” are a much more effective response to temptation than the words “I can’t.” In one study, respondents were divided into two groups. When faced with temptation to eat chocolate candy, one group was told to say “I can’t do X” and the other was told “I don’t do X.” Those that used the words “I don’t” succumbed to temptation to eat candy bars much less frequently (36% versus 61%).


Clear notes that words “frame your sense of empowerment and control” and can result in very different actions:


  • “I can’t” sounds like someone else is in control and forcing you to do something that you don’t want to do.
  • “I don’t” sounds like you are in control and that you have control and power over the situation.
    How can you apply this information? Write personal finance “I don’t” statements. Below are five examples:

  • I don’t pay interest and fees to use credit cards
  • I don’t get car loans longer than 4 years
  • I don’t invest in any investment product that I don’t understand and feel comfortable with
  • I don’t use payday loans and pawn shops
  • I don’t pay bills late

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