Using Friction Strategically

Being a savvy financial manager is often fraught with friction.

You know you need to open that Roth IRA but that requires decisions and actions that feel annoying and difficult.

You want to trim your streaming services but it requires figuring out where you’re paying what and finding your cancellation options.

You know you should do less takeout, but that requires preplanning dinners and making a better grocery list.

You know you should move your money to a higher yield account, but that requires a bunch of hoop-jumping and you never have the energy to deal with it.

The list goes on and on…

The friction of managing money well, like many tasks of adulting, is ever-present.

Just in those few examples above you can see how effective a little bit of friction is at preventing you from taking certain actions.

That’s why today we’re going to focus on where you can harness such friction to reduce certain actions that aren’t helping your financial life.

By intentionally making certain tasks just a little more arduous, you can actually make better day-to-day financial decisions easier.

Here are a few of my personal favorites:

1)    Keep your savings in a separate bank account (i.e., online high-yield account like Capital One 360 Performance Savings or similar) so it’s a 2-3 day transfer away from your regular checking. This adds friction to accessing extra money, which makes you think twice about using it.

2)    Don’t use a cart when you go into a store for errands. While you might need a cart for your primary weekly grocery run, almost every other errand you can (and should) get by without. You can only buy what you can carry. This significantly reduces the number of throw pillows and cute things you buy at HomeGoods or Target, as well as hundreds of dollars’ worth of bulk packages at Costco.

3)    Keep your cash at home, not in your wallet or purse. No more quick cash-burning decisions throughout your day.

4)    Don’t allow merchants to save your payment information for future purchases. And delete all the autofill credit card information you can find in your browser/phone. When you have to find your card and manually enter payment information, it slows you down and you’re much more likely to avoid impulse purchases online.

5)    It may be more extreme, but if you need to avoid credit card use, there’s nothing like the “freeze it in a giant block of ice” method to add some serious friction to using those digits.

Sometimes friction is what blocks us from doing what we need to do and strategically removing it and mindfully overcoming it is necessary. But when we flip that around, we can intentionally insert friction in places to slow down spending and make better decisions more automatic.

Give these a try this week and you’ll see how powerful strategic use of friction can be.