“It has been proven time and again, that dynamic change happens on three levels – intellect, emotion, and behavior.”
Humans are, generally speaking, very similar to one another.
We think, we love, we do.
Whether it is education, prayer, finances, work, leadership, parenting, every path of change is derived using the most important areas we as humans have. We think of the change, we feel the change and then we do the change.
Is positive change that easy?
Is financial change that easy?
We think so.
This is why we like to use the Head, Heart and Hands model for creating that change in children, and adults. Not only does it give direction to kids who have not really developed money habits as of yet, but it gives a large positive change to adults who have developed unhealthy habits when it comes to money.
To know how to effectively use “Head, Heart and Hands” means that we need to understand each part and how it relates to others. As well, we need to understand how missing one piece of this equation can cause us more damage.
What are the basics of financial Head, Heart and Hands?
We should first look at the different parts of Head, Heart and Hands to better understand the overall picture, and each individual part. By understanding how each piece is just as important as the others, your change will be more powerful and more sustainable.
Cognitive understanding is the most basic part of the ‘Head’ in Head, Heart and Hands. We think, we reason, we understand – everything that is brain-centric.
When we read or hear a lecture, we grow our understanding of the world. We determine the next course of action based on our previous learning. The more we learn, the more we understand.
Caring and feeling are the primary aspects of the ‘Heart’ in Head, Heart and Hands. Empathy and feeling allow us to find value in the things that we do – work, play, education, and life.
Feelings are what give us the drive to take the path to achieve a goal. For many of us, the ‘Heart’ lets us not sail rudderless. It gives what we do meaning.
Doing is the ‘Hand’ in Head, Heart and Hands. Primarily, practicing and learning by doing are the chief actions of this part.
Learning is done in the ‘Head’. The ‘Hands’ are involved with that action, that motion that takes a thought or lesson and puts it into actual action.
Examples can make everything a bit less complicated
Let’s talk a bit about using Head, Heart and Hands in the real-world.
Let’s assume that with it being Summer, you are thinking about going on vacation. You want to spend time with your family at Niagara Falls, or Myrtle Beach, or somewhere that your family used to go. You pack the car or truck or van up, and you start to roll out.
But, you lack a critical component…
How?
You decided to do something on a feeling, and were all action.
But where was your planning? Where was the critical thinking?
Some would say, especially as an adult, going on a trip without thinking, without the planning, is reckless.
For many, this is done every day. We make purchases by seeing and feeling, and then buying. We don’t think about an immediate (or future) impact. We also don’t think about our budgeting nor our accounts (credit card, bank, savings, etc).
Credit cards have slowly given rise to this line of thinking – and doing.
Instead, you should stop, and count, and then go.
Patience is not something everyone has. And, for those that do, eventually it can run out fast.
When we are browsing a store or website, we can fall victim to missing the ‘Head’ of the Head, Heart and Hands. If we stop, count to ten while thinking about that purchase, and then go, quite likely, we won’t make the purchase.
It is a reckless cycle.
In the above example, if we would’ve simply planned the vacation, then things change. We likely would have more money for the trip, have our friendly dog or cat taken care of, and we wouldn’t have forgotten to turn off the coffee pot!
What if you don’t have the heart in your decisions?
Sometimes you will notice that you have great planning, and great execution, but you feel a bit empty.
This is especially true when you budget, without goals.
Imagine you have this great list of everything in your budget. For 12 months, you have religiously, every two weeks, taken care of your business. You have saved, have spent and have paid everything on time.
It feels good…
But…
Something is missing.
Caring for why you are doing, what you are doing
Without goals, meaningful, real goals for your budgeting and spending, you will feel empty at times in your money matters. You are missing an essential part – the why? This is the feeling, the caring, the core of why we do the saving and budgeting.
And if you leave it out, your efforts will feel disjointed.
Instead, every money plan should have a goal. Even in the first example, there was a clear goal and a reason for that trip. Imagine saying “Let’s go on a vacation, the bags are packed, lets drive…”
It would be exciting, but it would also cause a bit of confusion.
Is there ever such a thing as too cautious?
The last example of using Head, Heart and Hands correctly (or not), involves planning and execution.
When the ‘Hands’ of this philosophy is missing, you likely have a situation called ‘strategy without legs’. This means that your soldiers are ready…but you are having them stand there waiting. Nothing is happening.
One of the best examples of this involves how you handle extra capital.
Think about this…
You have been saving and saving like crazy. You have cut extra spending, stuck to your budget and just, in general, been the pinnacle of good spending. After you’ve saved a few thousand dollars, you leave it sit…and sit…and sit…
Sitting money does only one thing for you
Having your money sit and wait does one thing – provide you completely liquid cash for some event.
But in the example above, you’ve likely already planned for that. You likely have an emergency fund. You likely have a vacation / Christmas fund. Your credit is healthy. And this means that we are talking about purely liquid, saved money.
Why not make that money work for you?
Do you have a retirement account started? Can you increase your 401(k) contribution? Can you start or increase the amount in your First Choice IRA?
What about other investment bodies; specifically ones with little risk, and better rewards?
Money market accounts (a higher interest yielding savings account) and certificate of deposit (CDs) are specific investments that will keep your money working for you.
Also, from the above example, if you have saved and saved and now have enough money to either take a trip or buy something for you… and you do neither. Eventually you will not find much enjoyment in saving.
What did it ever get you? Nothing.
You saved with a target, then never allowed yourself to buy the target. You have hijacked your Head and Heart.
Beware – two of the three of them may gang up and overthrow you.
We are often led by our Heart. And that is not a bad thing. We just need to allow our Head to guide our Heart to greater things. If your Heart desires all short-term goals… you may have a lot of stuff… but nothing to show for it.
Allow your Head, Heart, and Hands to work together. Propelling you into a bright future. If you find one of your “parts” its way all the time, step back and think about your long-term goals and work on them.
Your overall body will thank you for it.