saving money
    I was a nerdy kid. In school, I genuinely enjoyed pretty much every subject–except for history.

    History seemed so old, unrelatable and, well, boring. I could not get into it. Then, one summer, my parents and I visited my dad’s family in Indiana. On the way, we stopped at a historical marker, and I looked down at some old, rusty loop on the ground. “That’s a hitching post,” my dad said. “Abraham Lincoln was here. He might’ve tied his horse to that.” Something clicked. I thought, “Holy crap. That old guy I read about was HERE? In this same spot?”

    It seemed surreal to me that Lincoln’s boots might have touched the same dirt now on the soles of my beat-up Reeboks. Suddenly, I understood why people found history fascinating. Reading about it, I felt nothing. But taking action–visiting and experiencing history–changed my entire perspective.

    I think the same thing is true with personal finance. You can read about money management until your eyes bleed. But nothing will make you care about your money quite like action–even a tiny action. 

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    A while back, I interviewed Laura Levine, President of the Jump$tart Coalition, an organization dedicated to teaching financial literacy in schools. She told me that one challenge they face is deciding exactly who should teach financial literacy. Is it math? Is it psychology? She said:

    “There isn’t a way to identify where all the finance teachers are.  If you teach algebra, there’s very little debate that’s in the Math Department. But personal finance might be social studies or consumer science or business. There are a lot more variables.”

    Personal finance is tricky. Financial literacy is obviously important, but action is what ultimately leads to making better choices with your money.

    tiny actionsWhen you put a little more money toward your debt and start seeing that balance go down, you start to care. You begin to see that your actions are quite literally paying off, and that makes you feel in control. When you feel in control, you become engaged and empowered. When you feel empowered, you start coming up with financial goals and researching ways to make them happen. Then, before you know it, you’re a full-fledged money nerd.

    It just takes one small step. There’s a name for this: Domino Theory. Here’s how one entrepreneur put it in an interview with the University of Colorado:

    “Domino theory is a framework that helps people understand that no matter how big or small their hopes and dreams, they can accomplish them by seeing the world as a set of dominos. All it takes is one small strategic action to set big things in motion and align with the actions of others.”

    Here are a few examples of “one small strategic action”:

    • Call your credit card company and ask for a better interest rate.
    • Find a cheaper cellphone plan.
    Cut back on your impulse spending, then use that extra money toward your student loan debt.
    • Sign up for auto-pay with your student debt payment and get a discount on your interest.
    • Enroll in your company’s 401(k) plan.
    • Take on a side gig and earn some extra cash.
    Ask your boss for feedback in preparation for your raise.

    I’m not saying the basics of money management aren’t worth learning. They are! We need them. However, personal finance is so much more than those basic rules. It’s more to do with behavior and action. “Spend less than you earn” is not exciting, engaging or encouraging. But seeing your debt slowly fade into nothing? That’s personal finance in action, and it makes all the difference.