I just finished reading the book The Power of Habit by Charles Duhigg, and I highly recommend it as its premise is pretty life-changing.

Humans are basically a cluster of habits, some good and some not so good.  A 2006 Duke University study found that 40% of the actions people perform each day aren’t even decisions, but habits.  The book dissects habits so that they are understandable and changeable.  When you recognize that a habit is made up of a cue (another word for trigger), a routine, and a reward – what the author calls “the habit loop”— and the whole thing is fueled by a craving, it becomes much easier to change our bad habits.  A craving is anticipation of a reward, putting your brain on auto-pilot (auto-pilot is an evolutionary shortcut for the brain, so we can save energy by performing routine tasks with minimal thinking).  And the brilliance is: you may as well train your brain to be on auto-pilot for optimal outcomes, rather than detrimental ones.

Here is an example involving some of my favorite things, money and food: it’s Friday night and you feel exhausted from the week and too tired to cook (cue = exhaustion).  You order in for delivery or go out to eat and spend more than you wanted to (routine = ordering in for delivery). The reward is satiated hunger with minimal effort.  The craving that adds fuel to the fire of this habit loop could be for something like pizza, or an otherwise not-so-healthy item.

Now that we can see the habit deconstructed, it’s much easier to see there are options. To change a habit, you change the routine.  So the cue remains as is — exhaustion at the end of the week.  The reward stays the same, too — although I’ve noticed that usually the reward can actually be improved upon.  In this case, we can optimize the reward by not only satisfying our hunger, but how about saving money and eating more healthfully, and thereby feeling better both financially and in our bodies as well?

So how do we change the routine?  This is where inspiration and creative problem-solving come in.  How about having something that we love in the freezer that just needs to be popped into the oven?  It could be something we’ve cooked ahead of time and frozen, like enchiladas, or maybe it’s a favorite healthy frozen meal — and if you just want to designate Friday as your cheat day, it could even be a frozen pizza.

Identifying your cues and rewards and changing up the routine is a brilliant, life-changing concept.   With this knowledge, we can create new habits in any area we can think of.  A couple of new habits I’ve picked up include starting my day by meditating (I have a meditation on my phone — it’s a great way to wake up while still in bed) and then immediately exercising… all before I even eat breakfast.  Since your brain tends to be on auto-pilot, it’s just a matter of bringing awareness to the habits we’d like to improve upon, and reaping the new and improved rewards for altering the routine.

Keystone habits are another important concept explained in the book. These are small habits that have the power to start a chain reaction — a domino effect of more and more good habits. Exercise is a keystone habit, as is making your bed in the morning, which the author says leads to better productivity, sticking to a budget (you know I love that one!), and a greater sense of well-being. So now I am religious about making the bed!

With average U.S. consumer debt at $95,601 per household excluding mortgage debt,  as well as more and more people living paycheck to paycheck (about 40% of Americans couldn’t come up with $2000 if they had to), bad money habits, unfortunately, prevail.  A lot of the benefit in working with a financial planner like me who is cash-flow focused is creating positive money habits.  Most bad habits have been developed simply because we have never been taught another way.

What are some habits you’d like to change?  To start, make a small list of one or two, so as not to overwhelm yourself.  Identify the cue, the routine, and the reward for each.  (If you’re challenged to name the cue, read the appendix of the book, because sometimes it’s tricky.) Then brainstorm about new routines and how the reward might be improved.  You can also add in a reward for yourself if needed — for example, a healthy snack after exercise.  Give yourself some time to integrate the new habit, and you will be amazed at how quickly it sticks like magic.  Duhigg says, “It seems ridiculously simple, but once you’re aware of how your habit works — cues & rewards, you’re halfway to changing it.”  The brain can be reprogrammed when you become deliberate.  I’d love to hear how habit-changing goes for you!