A person’s environment can have a powerful influence on his or her behavior. If you would like to increase your wealth, then you must remove the cues that cause you to engage in practices that deplete your wealth. You must avoid or change situations that lead to unwanted actions such as overspending. “Stimulus control” is the term used by researchers when a person wants to make a healthy environmental behavior change. A financial example of stimulus control might be to, literally, freeze your credit cards by putting them in a cup of water. By the time the cards completely thaw, you’ve had a chance to fully evaluate the purchase.

There are several ways to adjust your environment to a more positive atmosphere for change. A few we will discuss today are: avoidance, reminders and warning signs, rearranging things, breaking the chain and anticipating difficult situations.

Avoidance is simply staying away from people or things to avoid temptations. Avoidance is not a sign of weakness, according to the book Changing For Good. In fact, effective self-control includes the ability to prevent a problem from starting. So, if going to the mall or the movies is hindering you from reaching your financial goals, then avoid or limit these activities. Don’t use other people as an excuse not to change.

Reminders and warning signs is the second type of stimulus control. These controllers act like stop signs at a busy intersection in controlling behavior. A few examples are a credit card sleeve, an ATM/Credit Card/Cash Tracker and a simple “to do list.” The Institute of Consumer Financial Education

The Institute of Consumer Financial Education offers a credit card sleeve with cautions on it such as “overuse can be dangerous to your wealth.” Available from Rutgers Cooperative Extension is the ATM/Credit Card/Cash Tracker. This tool helps you keep a running tally of purchases.

When making your “to do list,” add a few action steps related to your wealth goal such as “put $5 in the savings jar.”

Many of us lead very busy lives and have very little “discretionary” time each day. With this in mind, a third type of environmental change is to simply rearrange things. For instance, if you are finding it hard to make regular investment deposits, arrange for them to be electronically sent from your account or paycheck. You can also use this method to pay regular bills, which will save you time, postage, and possibly late charges.

Breaking the chain early before things get out of hand is another environmental control strategy that can be used to improve wealth. Many times financial behaviors are the outcome of a series, or chain, of behaviors. An example would be reaching a dangerous 20 per cent debt-to-income ratio. This might involve a series of purchases while, at the same time making only minimum payments on credit cards. How do you break the chain early? Place such restrictors on yourself as:

· Spend no more than $500 on holiday gifts and parties

· Carry no more than a $1,000 revolving credit card balance at any time

· Buy a “new used” car instead of a new car

· Deposit 5 per cent of gross income in a 401(k) or 403(b) plan via payroll deduction

Finally, anticipate difficult situations that may cause you to spend money. Have some polite responses ready when others try to encourage you to spend money. Maybe something like, “I’m waiting for that movie to come out on video,” when asked to go to the movies. Or if you’re enticed to go with others to a restaurant for lunch you might reply “No thanks, I brought my lunch today.”

Are you willing to make changes in your environment to increase your wealth? There is no time like the present to identify the three biggest negative financial influences in your life. Once you’ve identified them, develop and implement a plan of action to avoid or reduce them.