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Advice / Succeeding at Work / Money

The Secret to Hitting Your Financial Goals

This article is from our friends at LearnVest, a leading site for women and their money.

Two years and one week ago, I began logging all my spending on a Google spreadsheet.

This was before I worked at LearnVest, and just after I got a budget for the first time in my life, well into my 30s.

I had more than $20,000 in student loan and credit card debt that, until then, I had not been able to figure out how to control. When I learned how to set up my budget, I saw very clearly that if, every month, I spent below my means and paid a little bit toward my debt, my debt would go down every month until it would be all gone.

So, I began following a strict weekly allowance. In order to make sure I hit my number every week, I wrote down every single dollar I spent in the Google doc. (I also “planned” my spending by logging expected future expenses in upcoming weeks, so I sometimes would enter a week already knowing that I needed to reserve $20 for dinner with a friend and that I had that much less to spend that week. Read more about how I paid off my debt.)

That very first week, I spent $6 on laundry, $38 on groceries, $45 on a couple meals and drinks out with friends, $24 on various fast food lunches, $60 for a hotel room for my friends’ wedding, $15 on the bus out there, $19 on a thrift store dress, and $15 on some personal finance materials. And on Thursday, September 23, 2010, I logged a big fat $0, highlighted it in green, and put a smiley face next to it.

And thus, the $0 Day, a concept that can help you reach your financial goals, was born.

Stumbling Into the $0 Day

Looking back at my calendar, I can see now why I didn’t spend any money that day—I went to work, brought my lunch, took a yoga class at a center where I had a membership, and then headed home to pack for the upcoming wedding.

I hadn’t intended not to spend any money, but the next morning, when I went to log the previous day’s spending on my spreadsheet and realized I hadn’t spent a single cent, I felt a small thrill. In my battle with my debt, I had scored an easy win and made it that much easier on myself to meet my weekly budget goal, as well as my larger goal of paying off my debt.

In the weeks that followed, I didn’t try to have $0 Days, but I managed to get one in about every other week simply because of busy days that didn’t involve going out or running errands. But then, I went a few weeks without logging a single $0 Day, and I realized I missed that high.

It was at that point that I began to challenge myself to have $0 Days.

From mid-November 2010 through the end of December, I logged 12 $0 Days. It seems counterintuitive to have achieved that during the hectic holiday season, but I logged six of those $0 Days during Thanksgiving and Christmas, when I was hanging out with my family at home—away from the Black Friday and holiday sales crowds.

For the other days, if I knew that I didn’t have any social events planned that would require me to spend money, I would try also not to buy a snack or run an errand that could be done another time. I wouldn’t plan out my $0 Days—it’s just that if I made it halfway through the day without spending any money, and I knew I didn’t have any specific reason to be spending money that night, then I’d try not to buy anything for the rest of the day. That way, the next morning, I could open the spreadsheet and write “$0,” highlight it in green and give myself a smiley face.

The Benefit of Little Goals and Little Victories

Psychologists have found that one of the easiest ways to veer off the path to your goals is to craft them in a way that is so difficult you are likely to fail. Trying not to eat meat? Start with Meatless Mondays, rather than trying to be 100% vegetarian all the time.

And so it goes with your budget. If you’re trying to spend within your means, or save a lot of money or pay down debt, trying to control every last penny might stress you out so much that you go on a shopping spree to relax.

But scoring an easy, painless win that doesn’t cost you anything in stress or effort will give you a little boost on your way to meeting your larger goal.

So, whether you’re trying to pay down debt (as I was when I started $0 Days), or you’re trying to save up money (as I am now, two years later), celebrate a $0 Day whenever you have one, even with something as simple as a private smiley face.

It’s probably best not to make it a regularly scheduled event that will make you feel bad if you don’t meet your goal for that day. In other words, make your $0 Days the kind of thing where you can only win and never lose.

But if you want to log your victory in a financially meaningful way, you can put an extra dollar toward your debt or savings on that day and log that transaction in LearnVest's Money Center. You could then file these $1 transactions in a folder marked $0 Days to commemorate your little victories.

However you decide to mark your $0 Days is up to you. Just make sure that you do celebrate them. After all, we should rejoice over every step we take toward achieving our goals.

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  • Avoid These Top Savings Mistakes
  • Checklist: I Want to Build Up Savings
  • Photo of empty wallet courtesy of Shutterstock.