One of the reasons it’s so hard to save is the intention-behaviour gap.   That’s defined by behavioural economists as “the disconnect between knowing what you need to do and actually doing it.”

Here’s an example of the intention-behaviour gap in action.  How many times have you intended to go for a run or to the gym only to hit the snooze button and drift back to sleep?  We go to bed with very good intentions of getting up bright and early, putting on the training gear and heading out the door.  Somewhere during the night, the intention weakens.  Maybe you didn’t sleep very well, or when you woke up you heard the rain on the roof.  It’s much easier to drift back to sleep than follow through on the intention.

We do the same with our finances.  We start out with best of intentions, knowing we need to cut back our spending and start saving for retirement or the trip overseas.  Then life just seems to get in the way, and our best intentions slip and we don’t quite get around to doing it.

In October 2015 a survey of 2,000 Americans by Capital One found that people are willing to make sacrifices to increase savings (the intention), but what they say they’re willing to sacrifice and reality are two completely different things (the behaviour).

Two thirds of the respondents in the survey said for an extra $1000 in savings they would give up internet for a month. 30% would give up their smartphones for six months and a 54% would give up coffee for the rest of the year.  Really?

Take a reality check when you tell yourself these sorts of things.  We aren’t doing them.  The intention-behaviour gap has kicked in.

The article concludes by saying, “No matter how broke people may be nor how desperately they may want to save, mobile phones are now considered by many consumers to be more important than their tooth brush or sex!”

Simply knowing what we need to do isn’t enough – we also need to take action.  How do we do this?

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