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Reform Your Financial Picture by Cultivating Your Sense of Personal Agency

The modern world floods us with stimuli and imposes increasingly urgent demands upon our time and energy. When you check your social media feed, you’re inundated with messaging telling you to do this, not that. Or that buying a certain product will change your life.

Similar influences can be found throughout your interactions with people at work or among friends and family. You get pulled into doing things and forming habits, which adds to considerable expenditure over the years.

At some point, many adults come to wonder how their finances got into such a bad state. They look at a situation that has become a complex tangle of factors and feel powerless to even start unpicking that mess.

No matter how old you are or what financial shape you’re in, that feeling of powerlessness can be the glue that binds those problems into an insoluble, debt-ridden nightmare. And it can be overcome by cultivating your sense of agency.

A lack of financial skill

Money is only a tool. People might see their credit limit as an extension of their wallet and indulge in a shopping spree, or they could use it more sensibly to automate bill payment. They might seek mortgage refinancing to take advantage of lower interest rates or to raise funds for emergency needs.

In any of those scenarios, it’s the person’s circumstances and underlying motivations that determine right or wrong or differentiate smart versus sub-optimal uses of money. The problem most people have with money is that, like any tool, it requires skill to use.

Unfortunately, money doesn’t come with a manual of instructions. Instead, those skills are acquired as a form of financial literacy. And math is only a small component of that knowledge. Learning about money ideally starts at home with our parents.

In that regard, we all have different experiences that can put some people at a disadvantage. Some of us had parents who didn’t demonstrate good financial habits. Others might have been financially prudent but didn’t have to deal with a world of online shopping or easy access to credit lines.

A complex and overwhelming world

There’s no question that our world has grown increasingly complex. And our respective backgrounds might have done us a few favors in terms of preparation.

These factors combine to make us feel overwhelmed by modern living in general. Everything is so vast and complicated, while individuals lack the ability or skill to make a difference. Thinking along those lines makes it so much easier to go with the flow. It simplifies things.

Thus, when you see a social media influencer touting a certain product, you buy it. When a friend enrolls in CrossFit or yoga as part of their New Year’s resolution, you do the same and drop out of the program when they do. We fall out of touch with our intrinsic motivation to do things.

This is where the concept of personal agency can make a difference. At its heart, agency is all about recognizing that your decisions can make a difference. It’s a quality that can be cultivated. And in doing so, you can gradually regain control of your life.

Regaining control through action

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Agency is particularly relevant when applied to your personal finances. Recall that money is a tool and that we don’t all start with the necessary financial literacy to handle it properly.

Instead of foisting blame on your parents, teachers, or other role models as you were growing up, recognize that it’s not too late to start learning. Manage your expectations. What you do to improve now might not solve your debt problems tomorrow or next month. But it will make things better and lead the way towards a debt-free future.

Begin to curate your stimuli, and carefully choose the people with whom you associate. Doing so removes elements that exert a negative influence on your financial habits.

It might not seem particularly relevant but work on your health and fitness. Becoming more physically active can influence your mindset. You feel stronger and have a heightened sense of self-efficacy. It empowers you and carries over to other endeavors, including financial management. As an added benefit, if you’re healthy, you’ll also incur lesser medical expenses.

There is no panacea for a myriad of financial issues. But you have to start somewhere. Free yourself from the groupthink, and dispel the illusion that nothing you do could matter.

Take action now. See the power of agency at work. Maybe you wish that you’d started doing this ten years ago. But ten years from now, you’ll be thankful you initiated that change today.

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