Are YOU serious about ‘culture change?’ How thinking long-term can benefit you

ACTION: Adapting CANSAS to Individuals’ Own Needs                                          Recovery Conversation Theme #21: Managing Money

By Warren Heggarty 

nab photo.jpg

You might have heard that the Hayne Royal Commission into financial institutions has revealed some pretty poor corporate behaviour on the part of major financial corporations like banks and insurance companies. 

Short term gain seems to have been prioritised over long term reputation. You would think that having been caught out, the banks would have a short term goal to lift their game. But no, it seems they are conveniently taking a long view of it. From the papers on Tuesday 27 November 2018: 

[NAB Chairman Ken] Henry and [CEO] Andrew Thorburn were yesterday grilled at the banking royal commission over how they wouild stamp out bad behaviour –including charging fees to people who had died- and the time it would take. “It could be 10 years,” Dr Henry said. “I hope not, but I wouldn’t be at all surprised. That would not be unusual for organisations that seek to embed challenge in cultures.” (Moullkia & Butler, 2018) 

Indeed. Fortunately, Panorama readers do not have to suffer with that kind of lack of enthusiasm for change when it comes to managing finances. Many of us, it is true, have picked up some unhelpful money habits (although fleecing the dead is probably uncommon among the people who access our services) but it doesn’t take ten years to make a start. 

The long term view is unnatural 

One of the problems ALL humans face with money is that it is natural for us to seek short term results. Successfully managing money (and many other things including our overall health) requires us to take a long term view. It is unnatural in a way. We often have to resist the urge to do what comes naturally if we want to do what is best for ourselves. 

The long term view is better 

One of the hard lessons in life is ‘deferred gratification.’ That means going without in the short term to ensure we have something much better in the long term. Short term sacrifices often pave the way to big long term benefits, rather like the way spending time and money on education now can lead you to a better job later. Another example is that being a low paid apprentice to a tradesperson doing menial work for four years can help set us up to become self employed in that trade down the track. 

But HOW do we take the long term view? 

‘Many of us start out the year with the intention of making revolutionary changes to our lives.’ Says Dr Campbell Heggen, lecturer in financial planning at Deakin University’s Faculty of Business and Law. In reality, focusing on incremental behavioural changes and forming good habits for the long-term is often more effective.’ that is, taking baby steps, one at a time. As humans are hardwired to think more in the here and now, it means ‘we find it easier to prioritise smaller, more immediate rewards over larger, slower ones – like long-term savings,’ (Deakin University) 

He recommends six steps which you can read in detail at the website this.deakin. These are: Create a plan, set realistic goals, share your goals (ie, talk about them with others), focus on the goals (not the losses), automate your saving and be more mindful of your spending. 

So if you make a start now, just think! By the time the banks have changed their toxic culture and (perhaps) rehabilitated themselves in the eyes of their customers, you will be ten years closer to where you want to be. 

But you need to be serious about it. 

Deakin University. (n.d.). How to save money and take control of your finances. Retrieved November 28, 2018, from: lifestyle/how-to-save-money-and-take-control-of-your-finances 
Moullkia, J., & Butler, B. (2018, November 27). NAB chief warns: culture fix may be a decade away, The Australian  

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