The Power of Journaling

Dave Larsen
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Mastering your spending involves transforming your mindset. Attempting to improve your habits from a pure mechanical perspective is really tough. Instead of a fruitless “Just do it!” approach, you’ve got to address your thought process. That’s the way to build better habits.

In this post, I want to highlight 6 powerful ways that journaling can improve your mindset and behavior.

#1: Actively Increase Your Spending Awareness

Life’s pace often leaves little room for reflection, especially on our financial journey. A spending journal serves as a crucial pause, allowing us to contemplate our financial direction with each entry and review.

Deciding to use a journal means you’re trying to stop spending money without thinking. Even if you buy something on a whim, writing it down in your journal later makes you think about why you did it.

As you keep filling your journal, it turns into a record of how you spend money. Over time, you start noticing how you spend while you’re doing it, not just afterwards.

#2: Celebrate Financial Discipline and Creativity

Budgeting isn’t just about restraint; it’s a test of creativity and discipline. Celebrating moments of choice (like opting not to spend or making a budget-conscious decision) can be empowering. Revel in entries that show you kept to your budget, especially those rewarding $0 spend days.

If you buy something and then return it, your bank statement will show you made a smart choice. But it won’t show the even smarter choice of not buying it at all.

A spending journal is awesome because it lets you see and think about the times you choose not to spend any money. I really like writing down when I spend $0, or when I don’t spend anything all day. It feels good to write that I only spent $200 at Costco, especially when it would have been easy to spend $400.

#3: Take Ownership of Your Decisions

In a world where costs only seem to rise, taking ownership of our financial decisions is empowering. Journaling shifts focus from external frustrations to personal accountability, asking, “Given my resources, did I make the best possible decision?”

Writing in a journal won’t magically fix everything. Things outside our control are just that, outside our control. It’s smarter to focus on what we can change or influence.

Journaling makes us take responsibility for our choices, no matter the situation. We ask ourselves, “With what I knew and had back then, did I make the best choice?”

We think about our decisions and compare them to what could have been the smartest choice, without expecting to change everything around us. When we choose wisely, we see it as a victory. And if we find there was a better choice, we admit it.

(Note: I’m not saying you shouldn’t try to improve your situation. The point is to not blame your situation for your choices.)

#4: Align Spending With Core Values

Your journal does more than track spending; it reveals whether your expenditures reflect your true values. Don’t shy away from hard truths; use your journal to ensure your money is going where your heart is.

Here are some examples:

  • Emotions: Frustrated, Tired, Thankful, Rushed, Bored, Confused
  • Goals: Paying off Debt, Making Memories, Saving for Travel, Splurging on Date Night
  • Values: Being Generous, Patient, Focused on Learning, Feeling Content

It’s key to be real with yourself. People often make excuses for bad choices, so give yourself a little tough love.

#5: Accountability

Keeping a journal acts as a form of self-accountability. It’s harder to ignore unhealthy spending patterns when they’re written down, encouraging you to stick to your plans.

Self-evaluation is great, but you can also go even further by sharing your journal with a trusted friend or loved one. If you’re serious about improving your spending habits, someone to watch over your shoulder can be invaluable.

#6: Find an Emotional Outlet

Money and emotions are deeply intertwined, making it hard to navigate financial stresses without affecting our mood. A spending journal offers a constructive outlet for these frustrations, allowing you to articulate and process your feelings instead of internalizing them. By transferring thoughts from mind to journal, you create space for reflection and emotional release.

Now What?

Want to really change how you handle money? Give journaling a try! It’s not just about watching your spending—it’s about growing, getting stronger emotionally, and making choices that truly reflect what you want out of life. Jump in and see all the good stuff it can bring into your world.

Start Simple

There’s a bunch of cool ways to keep track of your spending with a journal. Maybe focus on just one type of spending, or go for it and write down every penny. You could jot things down right after you buy something or wait and do it all at the end of the day. Sure, I’ve got my own ideas about the best way to do it, but the real trick is to make the advice work for you. Explore how journaling can make a difference in your financial life.