As this strange year of 2020 draws to a close, ringing in the New Year will have more meaning than ever. If you want to start on a high note, I recommend the book Atomic Habits, by James Clear (2018).

The name “atomic” refers to the small size. The entire premise of the book is that you can make big changes in your lives over time by implementing tiny changes, and then consistently doing them every day. The author refers to habits as the compound interest of self-improvement. What makes this book so fascinating is the fact that the author has lived out all of his recommendations. His expertise stems, in part, from how he spent years rehabilitating himself after he was tragically hit in the face with a baseball bat in high school. His injuries forced him to relearn basic daily activities. He then needed to determine a clear course for his future. Only then could he mentally and physically re-establish himself with his peer group.

In Atomic Habits, James Clear identifies four basic laws of behavior change, as well as inversions of those laws.

1. Make it obvious (or make it invisible)
2. Make it attractive (or make it unattractive)
3. Make it easy (or make it difficult)
4. Make it satisfying (or make it unsatisfying)

Start with who you want to become

The most important takeaway, however, is the premise that what you are really changing is the way you see yourself. He describes that the first step, before the application of the four laws, is to identify the person you want to become. The second step is to prove it to yourself with small wins. The small wins are the tiny little habits that you implement to create the identity of the person you want to be.

For example, if you are having financial difficulties, it may be because you see yourself as a “spender”. You may even say to yourself, “that was how I was raised, I’ve always been a spender, and I just need to somehow keep my spending under control.” His advice is to develop habits so that you start identifying with the person you want to become. So instead of being a spender that tries to keep spending under control, you strive instead to start visualizing (and living as) a person who enjoys saving. By accumulating small wins with miniscule habit changes over time, you force your brain into becoming the person you visualize.

For example, let’s look at exercise

The author uses exercise as a great example many of us can relate to. For non-exercisers, the first habit he recommends is to show up at the gym for 2 minutes each day “because that is what exercisers do”. He notes that the short time frame is manageable for most people, and it starts to re-train the brain without overwhelming it with high expectations.

I love the exercise example, because at my local gym, it has been almost comical each year how many people show up the first week in January and try to go from couch potatoes to marathon runners overnight. Of course, within a few weeks, these people are nowhere to be found. They strove to make radical changes in themselves, yet they forgot the most important transformation that needed to take place: How they imagined themselves.

As financial advisors, we are always interested in anything that helps clients modify their own behavior in order to more certainly reach their goals. The author makes the case that implementing small changes makes it painless (and in some cases, even fun).

So, I’ll finish with a quote from the author:

“Building better habits isn’t about littering your day with life hacks. It’s not about flossing one tooth each night, taking a cold shower each morning, or wearing the same outfit each day. It’s not about achieving external success like earning more money, losing weight, or reducing stress. Habits can help you achieve all of these things, but fundamentally, they are not about having something. They are about becoming someone.”

Happy reading!

Kristina Bolhouse CPA/PFS, CFP®
Vice President/Shareholder

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