Many things in life are more important than money. Just about all of them cost money. If you want more of these things in your life than you have right now, author Frederick James offers methods to help you get there. Learn how to apply established behavioral and financial theories to improve your everyday life. By taking control of your finances, you'll be taking an important step to improve your physical health, as well. Written by a retired doctor who now invests in real estate, this guidebook ¿ introduces you to a PowerSpending system that will change your life; ¿ helps you create an action plan that leads to financial success; ¿ provides tips on building a healthy overall lifestyle; ¿ reshapes your view of money so you can make it work for you. Learning how to live a healthy life doesn't start and end with a trip to the doctor's office. It doesn't come with a big payday either, but building wealth and financial security makes it easier to enjoy a healthy and successful future. Learn proven principles to achieve your dreams with Spend, Don't Save.

Spend, Don't Save

How to Improve Your Financial and Physical Health by PowerSpendingBy Frederick W. James

Trafford Publishing

Copyright © 2011 PENTIME PUBLISHING LLC.
All right reserved.
ISBN: 978-1-4269-6494-7

Contents

INTRODUCTION............................................................................................1CHAPTER ONE Behaviors and PowerSpending: The Science of Habit Transformation............................9CHAPTER TWO The Process of Success: Creating a Plan of Action...........................................31CHAPTER THREE Building a Healthy Lifestyle: The First Priority of Financial Success.....................53CHAPTER FOUR Knowing and Living Your Dreams: The Driving Force of Achievement...........................83CHAPTER FIVE Reshaping Your View of Money: The Foundation of Financial Success..........................113CHAPTER SIX Investment Literacy: Knowledge of Options Equals Power......................................135CHAPTER SEVEN Becoming a PowerSpender: Complete Efficiency of Resource Transactions.....................161CHAPTER EIGHT Bring Chaos to Order: Smart Financial Record Keeping......................................181CHAPTER NINE Cultivating Resourcefulness: How to Seek Expertise and Self-Education......................193CHAPTER TEN Wise Use of Credit: How to be the Master, Not the Servant...................................211

Chapter One

Behaviors and PowerSpending: The Science of Habit Transformation

Getting your financial health in order begins with changing your consistent behaviors regarding your financial and physical health. These consistent behaviors are known as your habits. Whether your goal is to get out of debt, to build wealth or to develop a positive cash flow, the bottom line is, if what you want is something different than what you currently have, you must adopt new habits in order to obtain it.

In his book "The Speed of Trust," Steven MR Covey said that every family and organization is perfectly aligned to get the results that they are already getting. The same is true with your organism. This is because organizations and organisms function the same way. Both of them are controlled by a collection of individual processes which work together in order to achieve a common goal.

Just as there are organizations which are better aligned than others, so there are organisms (people) which are better aligned than others. You've probably known at least one person in your life who worked to create a good life for themselves while at the same time engaging in behaviors which were sabotaging their success. At the same time, you've probably known people who managed all the areas of their lives well and whose habits were all aligned to send their life in a positive direction.

Either way, each of these individuals was getting results in their lives which were consistent with their habits. The same is true with you and me and every other person on the planet. Your current behaviors are not capable of getting you anything different than your current results. This means that if you want to have something you don't have, your current habits must change.

That said, the focus of this chapter is going to be discussing how habits are formed, how they create circumstances and how you can replace old habits with new and empowering habits. While we are discussing this, I will be using terms which are commonly used to describe the dynamics of behavior transformation: attitude, emotions, perceptions, paradigms, thoughts, etc.

It's important to remember that these terms are often used interchangeably by the authors who are teaching this material. Although most of these authors are saying the same thing, many of them will use different terms to describe the same concepts.

Be careful not to get too hung up on the specific definition of each term, but seek to understand the underlying meaning. For example, some authors claim that attitude is a part of behavior while others claim that attitude controls behavior. Others claim that thoughts create emotional states while some will completely separate the two and even claim that emotional states control thoughts.

Again, focusing on the underlying meaning will eliminate any confusion which might come from overanalyzing the syntax. Behavior is perhaps the most general of these terms and usually refers to the aggregate of responses or characteristics people reveal in their actions, whether visibly or invisibly in muscular movement or in glandular secretion. Behavior, in its most technical sense, refers to all activities of people, singularly or collectively, which control the circumstances of their lives.

But the bottom line is that any consistent behavior can become habit and when it does, the net results become the circumstances of our lives. No matter what approach one takes in understanding the process, any individual can take deliberate control of their behaviors and form new habits in order to create new results in their life.

Of course, there are some things in our lives we can't control. However, the greater responsibility we take for our behaviors, the easier it will be to deal with the things which we cannot control and the less influence they will have over us.

We'll begin with taking a look at the process of habit development as it is illustrated in Table 1.1. As we discuss the formation of the habits involved in PowerSpending, we will be referring to these stages of behavior transformation:

If you are targeting a change in your behavior, you first must assess where you are along the continuum of change. If you develop an approach which is appropriate for your stage of change, your chances of success will increase.

This model has been applied across disciplines, including the field of healthcare. It is also reasonable that success can be achieved in the area of personal finance or any other discipline where behavior changes are required to achieve desired results.

For example, behaviors like "Pay Your SelfFirst", Investing, controlling your expenses, eliminating excessive spending, building a reserve, meeting opportunity squarely, and giving can all be looked at within the context of this model. This model can be used very effectively to assist in positive behavior change in area of personal finance.

Pre-contemplation Not thinking of changing the behavior

Contemplation Thinking about changing the behavior

Preparation Planning to change the behavior

Action Currently engaged in changing the behavior

Maintenance Has been engaging in changing the behavior and ready to become more advanced, learn more, etc.

Stages of Change Model for Behavior (adapted from Prochaska and DiClementi

Notice that there are five stages which follow a specific sequence. The first stage is having an old behavior which has become such a habit that the person is not thinking about changing it. Many people get stuck in the second stage, which is merely thinking about changing the behavior. Sometimes they are evaluating whether the old habit needs to change.

However, being stuck many times in this stage is what we call procrastination. It's when you hear someone saying: "I know I should get control of my spending, but...." The purpose of this book is to help you get out of that stage and into stages three and four.

Stages three and four involve planning and taking action, and...