Discussing the importance of building the habit of tracking finances every day, using the language learning software Duolingo as inspiration.
A few months back, I had a conversation with my partner about what habits we can use to keep our minds sharp. Our parents are getting older, and while everyone is healthy, we want to make sure that we’re doing the work now that will pay off years down the road.
Learning a new language was something that came up for me. I learned French in school as a kid, and while I don’t speak it fluently at all, I have been able to communicate with people while abroad (though not without some wild gesturing too).
But this means that the last time I learned a truly new language, I was 11.
So after some searching around, I found Duolingo. There are lots of different sites that do similar things, but Duolingo got good reviews and appealed to me because of its freemium pricing model.
I signed up, and started to teach myself German. (See the bottom of this post for why.)
This was about six months ago.
Actually, it was 162 days ago. Know how I know this?
Because that is my “streak” on Duolingo, meaning that I’ve done at least one drill every day for 162 days since I signed up.
What does this have to do with financial wellness or with you?
Quite a lot in fact.
Table of Contents
Psychological tricks to keep you going
Duolingo has got every motivational angle covered to get you to continue practicing a language. It’s brilliant.
First, there’s the “streak”. Just like with the Seinfeld joke-writing anecdote, once you have a streak, you want to maintain it.
Next, they have a scoreboard, where they place you with 30 random other users. The more drills you do, the more XP (experience points) you get. And who doesn’t want to get the high score?
Beyond that, they have different “leagues”. Finish near the top in the Bronze Level? You go to the Silver Level. Finish near the top there? You go to the Gold Level. I’m currently at the Diamond Level, and I do not want to slip down. (I got demoted to the Obsidian Level a few weeks ago and it sucked.)
There are achievements you can unlock and coins you can spend to level up…and I could go on and on.
The point is that they are using every psychological trick to get you to continue your learning.
Slowly, over time
I too am in the business of motivation. When I work with clients, they are building new financial habits, and habits don’t just fall from the sky; they are built, slowly, over time.
As an example, most people didn’t get into debt overnight. You didn’t max out your credit card in one go. It built, slowly, over time. Perhaps you used the card because you thought you would pay it off, but then when the time came, you didn’t have the money, and so it just grew a little bit, until it was a lot.
That’s not going to go away quickly. It requires habit changing. Paying off debt happens slowly, over time.
It all comes back to tracking
Everything with me comes back to tracking your financial decisions. What you spend. What you earn. What you do with your money, coming or going.
Before you can make any kind of major decisions about your money, you need to know where you are, and you can’t do that until you track your expenses for at least a month, optimally much more.
And this is much easier if you track your expenses every day.
Actually, I’ll make that stronger: You need to track your expenses every day.
It takes about 5 minutes to log down what purchases I made in a given day. I put it on my worksheet (you can get the worksheet I use with clients when you sign up for my newsletter) and that’s that.
But if I were to do this once a week instead of once a day, it would take much longer. And because of that, I’m less likely to do it.
Trying to instill this habit of tracking your financial decisions daily is one of the most challenging part of my job as a money coach. People resist this every step of the way. They say that their bank statement tells them what they spend. Sorry, they just forgot for the past two weeks. And anyway, isn’t Quicken good enough?
No, no, and no.
If you’re serious about changing financial habits, you need to do things differently. Going on autopilot is what gets you into financial messes, not out of them!
I want Duolingo’s mojo
The team at Duolingo clearly knows all of this, which is why they’ve done such a good job at tricking you into making a daily action over a long period of time.
And I want in on that. I’d love to build a Duolingo for financial wellness. I’d love to send alerts saying, “Congratulations! You’ve been tracking your expenses for 120 days! Keep it up!“
I’ve actually been looking at Zapier to build a kind of implementation of this. It wouldn’t be as slick as Duolingo, but it’s a start.
(Are you a software developer reading this? Maybe we should talk.)
But clearly the lesson here is that when it comes to money, people need as many different methods of motivation as possible so as to not succumb to avoidance. Knowing that tracking your expenses can be the key to becoming a millionaire isn’t enough to overcome the desire to avoid doing it.
If you want to develop good habits, then you need to do them every day.
And since my goal is to help you succeed with money, I have to use every tool in my toolbox to do this. So it’s time to make more tools.
And in the meantime, set a calendar alert.
Bonus: why German?
To be honest, I’m not totally sure. I’ve just always gravitated toward things that had German in them.
I’m a huge fan of Kraftwerk, with its childlike-view-of-the-future lyrics. I’m also a huge fan of Kafka, who even though was Czech wrote in German.
More recently I remembered that one of my first records when I was a kid was the 1983 German hit single “99 Luftballoons” (sometimes translated into English as “99 Red Balloons”) by Nena. So clearly there’s something about German that goes way back.
I also like the sound of German, in a way that I don’t feel about a lot of other languages.
More than that, I can’t say. Aber wann ich höre Deutsch, ich mag es.