Discipline IS Freedom!

The Psychology behind self-discipline and how we can build it in ourselves and others.

Discipline often gets a bad rap, conjuring images of boring routines, strict rules, and those dreaded HR meetings that start with, "We need to talk about your performance..." or "it has come to my attention..."

Just a side note... any sentence at work that starts with “It has come to my attention” is almost never good news. Seriously, when’s the last time someone said, “It has come to my attention that you’re getting promoted or won the lottery”? Exactly. But let’s get back to discipline.

This week we will talk briefly about the psychology behind discipline, specifically self-discipline, some things you can say to encourage others to build self-discipline, and a few strategies to make positive change in others.

?The Science Behind It

There’s a whole lot of research showing that discipline is key to achieving long-term goals and maintaining self-control. People with higher self-control tend to be happier and less stressed. Why? Because when you're disciplined, you're less likely to be caught in the last-minute panic of procrastination. Instead of scrambling, you're striding confidently toward your goals, like a boss.

Angela Duckworth, who’s famous for her work on grit, found that self-discipline predicts academic performance better than IQ. In other words, it’s not just the smart kids who do well—it’s the ones who keep at it, day after day. So, if you’ve ever been jealous of those “naturally gifted” people, just remember it’s the disciplined tortoise, not the hare, who wins the race.

Here’s the thing: when you commit to discipline, you create a structure that lets you do what you really want. Take financial discipline, for example. It means you’re not drowning in debt and can afford that spontaneous trip to Bali without maxing out your credit cards. Physical discipline—regular exercise and healthy eating—keeps your body in top shape, ready for adventures rather than holding you back.

So let’s divide the rest of this newsletter up into two parts: First, what to say to promote self-discipline.

When we coach clients or conduct workshops with firms, we often say “telling isn’t teaching.” Advisors are educators after all and telling people things doesn’t really do a ton. It is, however, a first step in broaching the subject and reframing topics for better understanding and adoption.

?Helping Clients Embrace Discipline

Many people struggle to take a disciplined approach to saving and investing. Financial advisors often find themselves explaining why it’s important to align actions with goals and dreams. Here’s how you can help clients see the light:

1. Discipline Leads to Long-term Satisfaction?

?? "Tell your clients that skipping that impulse purchase today means less stress and more smiles tomorrow. It’s like choosing a salad over a burger—hard now, but your future self will be grateful!"

2. Discipline Beats Raw Talent?

?? "Remind them they don’t need to be a financial genius to succeed—just disciplined. It’s like outsmarting your lazy but brilliant cousin in a game of Monopoly."

3. Financial Discipline = Less Debt, More Freedom?

?? "Explain that financial discipline is like a pair of magical handcuffs. Instead of restricting them, it frees them from the clutches of debt collectors. Even Houdini would be impressed!"

4. Better Financial Habits Boost Mental Well-being?

?? The American Psychological Association highlights how financial stress can harm mental health. Disciplined financial management can reduce this stress and promote peace of mind.

?? "Tell them that disciplined finances are like a spa day for the mind—without the fluffy bathrobe. It keeps their mind at ease, so they won’t have to sell a kidney to pay next month’s rent."

OK. So how do you build self-discipline in clients and others?

?Building self-discipline in financial planning clients requires a strategic approach that combines psychology, habit formation, and practical financial education. Here are some methods to help clients develop self-discipline:

?1. Set Clear, Achievable Goals

?? Why it works: We talked about this. Setting specific, measurable, and attainable financial goals gives clients a clear target to work toward. Goals provide direction and motivation, making it easier to stay disciplined.

?? Example: Encourage clients to set short-term goals like saving $500 in three months, which can then build momentum toward larger goals.

2. Break Down Big Goals into Smaller Steps

?? Why it works: Large financial goals can feel overwhelming and lead to procrastination. Breaking them down into smaller, manageable tasks makes the process less intimidating and helps clients stay on track.

?? Example: If the goal is to save $10,000 for a down payment on a house, break it down into saving $200 per month over 50 months.

?3. Automate Savings and Investments

?? Why it works: Automating savings and investments removes the need for constant decision-making, reducing the likelihood of clients diverting funds to impulsive purchases. This method leverages the power of habit formation.

?? Example: Set up automatic transfers from checking accounts to savings accounts or investment portfolios immediately after each paycheck.

?4. Use Positive Reinforcement

?? Why it works: Positive reinforcement encourages clients to continue practicing self-discipline by rewarding their achievements. This can create a positive feedback loop that strengthens the habit of disciplined financial behavior.

?? Example: When a client reaches a milestone, suggest a small reward, like treating themselves to something they enjoy but within budget.

?5. Educate on the Impact of Delayed Gratification

?? Why it works: Understanding the long-term benefits of delayed gratification can motivate clients to make disciplined financial choices. Teaching them the value of waiting for larger rewards can help curb impulsive spending.

?? Example: Show clients the potential growth of their investments over time if they consistently contribute rather than spend.

?? The famous “Marshmallow Test” by Mischel et al. (1972) demonstrated that children who delayed gratification tended to have better life outcomes, including financial stability, as adults .

?6. Track Progress Regularly

?? Why it works: Regularly reviewing financial progress helps clients stay focused on their goals and reinforces the benefits of disciplined behavior. It also allows for adjustments if needed.

?? Example: Schedule quarterly check-ins to review their savings, investment performance, and progress toward goals.

?? Monitoring progress has been shown to increase the likelihood of achieving goals, as it keeps individuals accountable and engaged (Harkin et al., 2016) .

In summary, discipline isn’t about restriction; it's about creating a life where your choices align with your long-term happiness and freedom. So, next time you hear the word "discipline," think of it as your secret weapon for a more liberated and fulfilling life. Plus, it’s much more fun than an HR lecture. And actually…

It has come to my attention… that you are feeling good about self-discipline at this moment and plan to incorporate the above strategies. Meh. but it was worth a try!

Visit me at www.CharlesChaffin.com for more or visit us to learn about our advisor programs, workshops, and consulting at www.PsychologyofFinancialPlanning.com.?

Citations:

Locke, E. A., & Latham, G. P. (2002). Building a practically useful theory of goal setting and task motivation: A 35-year odyssey. American Psychologist, 57(9), 705-717.?

Gobet, F., et al. (2001). Chunking mechanisms in human learning. Trends in Cognitive Sciences, 5(6), 236-243.

Thaler, R. H., & Benartzi, S. (2004). Save more tomorrow?: Using behavioral economics to increase employee saving. Journal of Political Economy, 112(S1), S164-S187.

Skinner, B. F. (1953). Science and human behavior. Simon and Schuster.

Mischel, W., Shoda, Y., & Rodriguez, M. L. (1989). Delay of gratification in children. Science, 244(4907), 933-938.

Harkin, B., et al. (2016). The effects of monitoring progress on goal attainment: A meta-analysis of experimental evidence. Psychological Bulletin, 142(2), 198-229.

American Psychological Association. (2017). Stress in America The State of Our Nation.

W?nke, M., & Schmid, J. (2017). The impact of financial discipline on leisure satisfaction. Journal of Economic Psychology, 62, 5064.

Tangney, J. P., Baumeister, R. F., & Boone, A. L. (2004). High selfcontrol predicts good adjustment, less pathology, better grades, and interpersonal success. Journal of Personality, 72(2), 271324.

Duckworth, A. L., & Seligman, M. E. P. (2005). Selfdiscipline outdoes IQ in predicting academic performance of adolescents. Psychological Science, 16(12), 939944.

Brown, M., Haughwout, A., Lee, D., Scally, J., & van der Klaauw, W. (2020). The Financial Crisis at the Kitchen Table Trends in Household Debt and Credit. Federal Reserve Bank of New York.

W?nke, M., & Schmid, J. (2017). The impact of financial discipline on leisure satisfaction. Journal of Economic Psychology, 62, 5064.