By: Kristina K. Bolhouse, CPA/PFS, CFP®

This book piqued my curiosity from two avenues: First, as a financial advisor, I’ve been fascinated at the differences between spenders and savers and even more curious when I see a person actually able to change from one mindset to another.

Second, I was personally curious as to why it does seem so hard to change even the simplest habits—like flossing teeth.  You may wonder what the flossing teeth has to do with the world of finances.  As this book explains, it’s all part of the same mindset.  Flossing teeth is referred to as a “small win” that may actually help you reign in spending later in the day or help you make other good decisions.

While the first two chapters of the book were not really exciting, by the 3^rd chapter and throughout the rest of the book, I became fascinated at some of the key concepts that affect not only individuals, but institutions and societies.  This is one book that gets better as you read on.

The most important concept is to understand the Habit Loop.  The habit loop is simply a cue, a routine, and a reward.  New habits are created when the old routine is interrupted and a new routine is put in its place.  It sounds simple except that like Pavlov’s famous experiment; our brains have been wired based on the cue.  Fighting the routine that follows the cue is the key to it all.

Other key concepts that support changing a habit:

• The power of “small wins” — little victories in our day help us change our routine
• The importance of the people we surround ourselves with to support our changes
• By focusing on one pattern, known as a “keystone habit”, many other habits will easily fall into place.
• A written plan—especially one that has instructions on how to handle a moment of weakness (when temptation is strongest) increases the odds of success

So, if you have any habits that you would like to change—financial or otherwise—I recommend this book as a great starting point.  Here’s a link to Amazon if you want to read further; http://www.amazon.com/The-Power-Habit-What-Business/dp/1400069289/ref=tmm_hrd_title_popover?ie=UTF8&qid=1366213513&sr=1-1

®2013 The Arkansas Financial Group, Inc., All Rights Reserved

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by The Arkansas Financial Group, Inc.-“AFG”), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from AFG. Please remember that if you are a AFG client, it remains your responsibility to advise AFG, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. AFG is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the AFG’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request. Please Note: AFG does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to AFG’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.