Executive Summary
In the initial stages of their careers, many financial advicers find that, with little revenue coming in and less than a full load of client-facing work to do, they spend the majority of their time on operations and marketing as they try to establish their practice. As a result, an advicer often has the capacity to say "yes" to any opportunity that comes along as they try to keep busy and (hopefully) improve their cash flow. However, as the advicer's practice grows and their calendars start filling up, they can find themselves at a point where they don't have enough time to start doing anything new until they stop-doing something else. Which begs the question: Is there a systematic way for a financial advicer to determine when it makes sense to say "no" so they can say "yes" to something else?
In our 138th episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards explore the concept of a "Stop-Doing" list (as opposed to a "to-do" list), various ways to figure out what should go on that list, and how advicers can go about executing the list (so they can go on to doing the things that can move their practices and the profession forward).
From a conceptual perspective, saying "yes" to something also means saying "no" to something else. For instance, saying yes to taking on an operational duty might not leave time for going to more networking events. Yet, while saying "no" isn't always easy (especially for many advicers who were attracted to the profession in the first place specifically because they like to help others), one effective way to get more comfortable saying "no" to an item on a "stop-doing" list is to identify and stay focused on a much more meaningful "yes". By having a strong sense of what their ideal practice would look like, advicers may find that it gets easier to filter through those things that impede progress toward their goals. (Not coincidentally, this is also a useful way advicers can help clients stay on track with their financial plan when clients are tempted to overspend or make detrimental changes when markets get scary).
By gaining clarity on a deeper "yes", an advicer can start to identify the best things for them to stop doing. One approach is to determine the dollar value of an hour of their time, and from there, make a list of all the things that they do for their business and identify those tasks that they can outsource at a lower rate. Another method is to conduct a time audit by installing a time-tracking app. As while there might be a menu of small tasks that an advicer might love to take off their plates, the real power of a comprehensive time audit is in the ability to identify large chunks of time that an advicer may be spending on low-value activities (I'm looking at you, TikTok!).
As Parkinson's Law posits, work will expand to the point where it completely fills an advicer's calendar. Ultimately, by conducting a time audit and making a connection with a deeper "yes", advicers can gain a better understanding of how they're spending one of their most precious resources (i.e., their time) and figure out what they should stop doing so they can start doing things that will move their practices forward!
***Editor's Note: Can't get enough of Kitces & Carl? Neither can we, which is why we've released it as a podcast as well! Check it out on all the usual podcast platforms, including Apple Podcasts (iTunes), Spotify, and Stitcher.
Show Notes
- Kitces & Carl Ep 137: When Does Your Career Transition From Saying Yes To Opportunities And Focusing More On No Instead?
- Getting Things Done: The Art of Stress-Free Productivity by David Allen
- Kolbe
- Dan Sullivan
- Katy Milkman
- Patrick Lencioni
- RescueTime
- Toggl
- Empower (Personal Capital)
- Mint
Kitces & Carl Transcript
Carl: What? Michael Kitces?
Michael: Carl Richards, imagine meeting you here in this Zoom room that we scheduled for ourselves.
Carl: So crazy the world we live in. You can just show up in a Zoom room and have a conversation.
Michael: It's amazing. Modern technology is truly an incredible thing, right? In the old days, we would have had to wait until we were in the same place together to do this, in which case there would be one one-hundredth of the episodes that there are now because we don't manage to cross paths very often.
Carl: For sure. Okay, I want you to think for a second.
Michael: Okay.
What's The One Thing That You Do Regularly That You Would Love To Stop Doing? [00:45]
Carl: Maybe everybody else who's listening can go through this exercise with us. So if you have a chance just to sort of pull over in your car, don't hit pause on the podcast, but get yourself to a place where you can think about this. Michael, if you just took a second, what's one thing that you do regularly that you would love to stop doing?
Michael: So I have one that I've literally been going through this week in recognizing in this context that I need to stop doing. So I've had a tendency for a long time, when I'm doing work with someone I know that I have an existing relationship with, I generally bring in team support to be in the meeting to make sure we capture all the stuff and do the things we need to do and get the right takeaways. But historically, when I've been doing anything that's business development oriented, I have not. I think probably some version of a script of I'm trying to create a relationship and a connection. I don't want to make this room extra crowded with let me explain this other person who's sitting in on this conversation while we're trying to get to know each other.
It crops up in new business development with clients, as well as some of the other business development things I do for our other companies. And what I've realized is, in the simplest sense, the fact that I always drive every business development meeting means I'm the one responsible for every post-meeting summary, write-up, takeaways, action items to sign out to the team. And that is not my strength and happy place. I'm decent at it. I'm okay at follow-through. But I don't relish the opportunity to get to queue up a list of follow-up workflow tasks that people need to have as takeaways from that meeting and drafting a follow-up message to recap the things that we talked about.
I'm fine at it. I don't really need to do it, really, to make the business effective and successful. And so I've been going through with the team this week to essentially say, okay, we need to start figuring out which business development meetings I can have a team member in with me who can help capture notes, get the context of the meeting, help draft the post-meeting follow-up. I might still review and send it out from my end if I want to from a relationship end. But someone else can capture the key points and draft it. And to queue up all the workflow tasks and takeaways that came out from that meeting. And recognizing every now and then there's still a meeting that I might want to handle solo. But then we can at least say, okay, new team default, someone's in with me every meeting unless I reserve the right to have an exception where I want to do a more intimate meeting and let go of it.
And it's a little thing, right, like summary of meeting, cordial follow-up, some workflow tasks to the team, and I'm a pretty fast typist. This is 10 to 15 minutes of follow-up. It's not a ton. But I have a number of business development meetings every week across all the different stuff that I do. It starts adding up quickly. It's not hard for me to spend an hour plus on that, 10 minutes here, 15 minutes there. Well, that was an hour. An hour is, well, 5% of a 40-hour week, or 2% or 3% of a 40-hour week, little less since I work a little more hours than that. But that's a couple percent efficiency. To let go of that, that would be pretty cost effective for me. So, time to stop writing post-meeting summaries and assigning post-meeting workflow items.
Carl: Okay, so everybody listening, I want you to notice something that just happened. So I'm going to just pretend like Michael's not here anymore. So, Michael...
Michael: Like a nature commentator.
Carl: Yeah, this is a, hey, hey, everybody, it's Carl. So what we know that what I want you to notice why we're watching this, what happened, because I do this too. In fact, everybody I talked to about this subject does it. Michael has a thing that he wants to stop doing. And he even knows it. He knows the whole detail. He's even been trying to do it, he's been talking about it. And then as soon as we into it, he does what I call pop-up windows. He says, "I'm decent at it. It only takes 15 minutes. It's not a big thing." He used all sorts of words like it's not a big, it's a small thing. All these little I call them pop-up windows that you have to close and close and close and close and close. And so what's really interesting is no one asked him about that part. We all do the same thing. There's this really interesting piece of, okay, there's a thing. All I asked was what do you want to stop doing? What do you want to stop doing?
Michael: I fell for the bait. Keep going.
Carl: This is really fun, by the way, just don't pretend like the kid in the blue shirt is here. So what's interesting about this experience is we all do it. We have to come up with these justifications around why we don't want to do a thing because we're good enough. He said, he even said, he referenced a Kolbe score. He said, "I'm pretty good at, I'm decent at follow-up." We all do this.
Michael: I am. I'm a 6 on follow-through on Kolbe.
Carl: Dude, guess what I am?
Michael: Not that high. How low does it go?
What Makes A "Stop-Doing" List So Useful [06:43]
Carl: Yeah, exactly. On everything but quick start, I'm just a mess. So it's fine. But my point is, let's talk about this stop-doing list. So that was the point of what we want to talk about. I would imagine maybe you all came up, hopefully you came up with something. On the top of my stop doing list has been email for a very long time, and by the way, checking social media for a very long time, which I actually have implemented these last 2 weeks. The concept behind a stop doing list, I believe I probably heard from Dan Sullivan. And then I blended some things from David Allen's "Getting Things Done."
And I love, we talked a little bit in our last episode about why we love stop doing lists. Sometimes it's easier to figure out things you want to stop doing than it is to figure out things you want to start doing. And what's interesting is once you stop doing some things and some space opens magically, especially if you've got some idea of intention, like I want to do more media or more podcasting or I want to write a book, if you've had some intention and you open a little bit of space, magically some of those things appear. It's really, really quite cool.
So, a stop-doing list is just a list of the things that you want to stop doing. I like to rank them in order of the things I want to stop the most. The way to categorize those in my mind is not... what would Dave Ramsey say? It's not snow, it's not, is it snowball or avalanche? It's not about the vault, it's not how big they are. It's about the one that takes the most, is most energy sucking, draining for you. It could be a thing that only takes you 10 minutes a week, but man, you don't like it. So put that one on the top of the list. Is that a snowball or an avalanche in Dave Allen's...
Michael: Well, if it rolls long enough, the snowball turns into an avalanche.
Carl: Yeah, who cares? Let's forget, forget we even mentioned he who shall not be named. That's what I call Dave Ramsey because he blocked me on Twitter years ago.
Michael: That's a special club, I thought.
Carl: It is. I was actually going to do an NFT back in the NFT days of a picture of Dave Ramsey blocked me. So put the thing you like to do the least on the top. And so Michael names a thing. Michael, what else have you stopped doing in the past? What else has been on your stop-doing list that you've stopped doing?
Michael: Oh, well, cumulatively, everything I did 10 years ago.
Carl: Pick the one that you were the most... What's the most surprising one where you're like, "Oh, I couldn't stop doing that."
Michael: Oh, the most surprising one is easy. It was hiring an executive assistant and putting them in my inbox.
Carl: Now, wow. So how long did that, from the time that occurred to you or somebody probably suggested it to you, is that true?
Michael: Yeah, yeah. I wouldn't have come up with that on my own. No, inbox, personal space, all this stuff happens.
Carl: And so you were like, "There's no way." And then over time, how long did it take you from the time that was suggested to get over all your fancy feelings about it and actually do it?
Michael: Probably 3 or 4 years if I'm trying to guesstimate when did I get so buried that that was probably coming up with a question? And then when did I actually hire someone to do it? Maybe 4 or 5 years if I try to patch that timeline together. It took a while for what I'm assuming is probably shared for a lot of people. It's just everything's in my, well, A, everything is my inbox. That's inviting someone into some potentially pretty private space. And then secondarily, just all the dynamics of can someone actually field my email effectively? What if they route the wrong thing? What if they reply to the wrong thing? What if they file the right in the wrong place? Then I don't see it. And then I didn't reply to someone about something that's really important and that's egg on my face. And just all the possible scripts about why that's scary, all that routed through my head.
Carl: And what about something that was smaller that went pretty quick? Can you think of anything where you're like, "I don't want to do that anymore," and you didn't do it?
How Michael Decided Which Things He Wanted To Stop Doing [11:12]
Michael: The first thing I went down in that path really early on in career was doing all my own billing and invoicing and then saying this is a really quite delegable task. I need to stop doing this. It's interesting, for me, there are, in part just because of how career evolves over time, you're prodding me for things that have been in different stages of kind of career evolution for me, which means the, as I like to put it, the filters that drive them to try to decide what am I filtering, what can make it through the filter to yes and what gets filtered out as a no, the filters change over time.
When I get back to the early letting go of billing and invoicing, in my head, that was some version of the dialogue of, well, your time should be worth at least $100 an hour. So if there are tasks you're doing that you could delegate to someone for $30/hour, you should delegate the $30 an hour work to do the $100 an hour work. Because this was too late in my career to value it $200 or $300/hour. But even at (getting back to last episode) $100/hour, it was still clearly a good arbitrage to delegate to someone. And so as I was approaching overall capacity where I didn't exactly have a lot of spare time, I'm trying to figure out what can I let go of, okay, the things that I could clearly delegate to someone for a lot less than my own revenue potential is probably a good place to start.
And I didn't particularly relish doing that for the same reason of the first thing I mentioned. I can do the follow-through tasky stuff if I need to. But I'm not excited to queue up my invoices. I'm not excited to queue up the post-meeting workflow task assignments that need to happen. I can do them enough that things don't fall, the wheels don't fall off. But I'm very happy to let go of those when we get there, right? In the working genius context for anyone who's been through that Patrick Lencioni program, tenacity is in my competencies, but not my geniuses, not my strengths.
Carl: Yeah. Okay, so let's just, I'd really like to get through the idea of describing. So you come up with a list of things that you don't want to do, your stop-doing list. I think it's pretty easy to figure out what should go on there. But, to me, it's a feeling, like, "Oh, man." Because it's not about being hard. There are plenty of things that I want to always do that are the most important things I do that are hard and I love doing them. I spend a lot of time doing hard things that I love doing. Right? So it's not about hard. It's about energy draining. You could probably think, it might be helpful to think about this in terms of relationships. What comes to mind, those of you listening, can you think of a relationship you'd like to stop? Because every time you hang out with that person, you're like, "Geez." Right?
Why People Are Generally Happier As They Age [14:24]
Michael: Yeah. Well, there's a lot of fascinating research around just happiness and well-being of people through our lives. We start happier when we're young, life's a little more happy-go-lucky. The happiness curve for the population, the aggregate kind of wanders downwards in our 30s into our 40s. The trough is somewhere in your mid-40s, which is slightly depressing as a 46 year old, but apparently life literally only gets better from here because it starts rising after your 40s. And it basically just keeps rising in your 50s and your 60s and your 70s and your 80s and even your 90s. They do well-being studies for people in their 80s and 90s and it's higher than anybody else across the curve, at least on average, population wide. And, to me, that's a fascinating thing.
As a 40-something going through this with parents getting older, as a lot of people do at that point, which I think is why we hit the trough in our 40s, sandwiched between parents getting older and the demands of children, what they find when they go in and try to figure out why do we get happier as we get older, not withstanding a lot of the health and other challenges that get pretty tough. And the answer essentially comes down to, because we get really good at editing the stuff out of our lives that doesn't matter or drags us down.
In our 20s, we hang out with that person we don't like because we're networking and who knows what we need to do to get ahead. We hang out with that person still in our 40s, because, well, I've known him for 20 years. I can't really kick him to the curb now. And then somewhere in our 50s and 60s, yeah, it just really doesn't make me feel happy in my life to be with them so I'm not going to be with them anymore. And now I feel happier. And we just start getting better at you used the word earlier "editing," I think is really good. We start getting better at editing our lives. And the better we edit out the things that take the joy and edit in the things that bring more joy, the happier we seem to be.
And I find there's a very similar phenomenon in what happens with advisory firms with sort of the caveat, you said earlier sometimes it's easier to stop doing than start doing. And what I found, at least from my experience, you have to come up with the stop doing stuff before the start doing stuff because otherwise there's no fricking room to start anything. There's literally, except the early years, we got a lot of time, not a lot of clients. You run out of time, you hit capacity. For most of us, if we're active, productive, professionally oriented adults, we tend to fill our calendars, unless we are very intentionally holding space, we tend to fill our calendars and they get pretty busy. Most people who are trying to grow their careers are like, "Well, I'd like to grow my career, but I also just don't feel like working very much." We tend to fill that time. We tend to fill that space, which means you don't get to start doing anything until you stop doing something. In fact, holding onto all the things you're doing is effectively means I'm saying no to every idea I have in my head because I literally can't do it. And so the only way you start doing anything new that sounds neater or more interesting is you have to pick something to stop doing first because it's the only way you get the space.
Carl: Yeah. I think that's super important. I heard somebody once say, "No is like a shotgun. Yes is like a precision laser." And, sorry, "Yes is like a shotgun. No is like a precision laser." That you, you can be much more precise about what you're thinking. And one of the things that I love to do, and it drives some people crazy because it takes a lot of the fun out of... You get the feeling that it takes a lot of the fun out of life to be this... But if you just count the cost of the tradeoff you're making, when you say yes to something, you are saying no to something else. And often you're saying yes to the things that are the most hand-wavy, urgent.
And sometimes in terms of people, you think about, if you think about all the tasks you're saying yes to, the appointments you're saying yes to, the meetings you're saying yes to, and you compare them to people, they're the kind of people that deserve the yes the least. You know the people who you're saying no to? Your daughter, your wife, the nice client who's not going to yell and scream. So I think it's really interesting to get really clear about every time I say, in fact, I think the cool way to think about it is I think it's an old Covey quote, "The way to learn how to say no is to give yourself a much deeper yes."
Michael: Wait, say that again? There's wisdom in them thar quotes. Say that again.
Carl: And I believe it's a, I'm paraphrasing some Covey quote that the only way to get yourself to say no, and I've thought a lot about this with financial planning and investment management and behavioral finance, the way to say, to get people to say no repeatedly is to make sure they're anchored to a much deeper yes, there's a much deeper yes here.
I'll give you an example. Katie Milkman, I don't think she'd mind me telling this story. She's a fantastic academic at UPenn. I wanted to have her on one of the podcasts I do. She was introduced by another academic who highly recommended she come and she said no. And I was like, "That's the first time..." I actually emailed her. I'm like, "I'm so impressed. It's the first time anybody's ever said no. Tell me about that." And she actually referred me to her speaking agent when I asked her if she'd be on my podcast. If you'll pay for my speaking fee, I'll come on your podcast was kind of the idea. And I was like, wow, this is amazing.
She told me she actually keeps a folder in Gmail called... I can't remember what she called it. I think it was probably just something like "Things I said no to." And every once in a while she'd go in and review it and feel sort of like, these are the...I said no to these so that I could do this thing over here. And she knew what, she even identified the thing in the email. She's like, "I'm focusing all my time on this." It was a really, I asked her if I could steal the way she said no, because I was like, "That's so impressive." She belongs to a no group, a saying no group. I guess there's a group of women that have organized these around the country, saying no groups.
And so I love that idea because she actually... And then Hal Hirschfield at UCLA told me he has a friend who chooses... He's an academic, tenured track at an important university and he could pay a little bit extra to have a parking spot closer per month to his building, but he parks in the free parking. And he actually moves the money that he would pay, he moves that money every month to a special account that he goes out to dinner with his family and kids when it gets to a certain size.
So every day when he walks, and especially when it's raining, he's like, "Yeah, my deeper yes is sitting right there. I'm going to take the kid, the family to dinner." So I love just the connection of the no to the yes. Does that make sense? And I want to make sure we have time to talk about the actual saying no list because we keep getting distracted by very great conversation.
What's On Carl's Stop-Doing List [21:11]
Michael: Well, yeah, I did want to come back to that. Just, well, I guess start my 2-fold question to you. What's on your stop-doing list and how do you make it? How do you make your list?
Carl: Yeah. Yeah. So the first thing I would strongly suggest is just play, just look, it's just a game, but go have fun with this. Go to the extreme edges of what you could say no to. I kind of have this wacky goal and I actually did it for about 6 months. It's changed a little bit lately because of some new projects, but I actually had this wacky goal to have no calendar. So people would say, "Hey, Carl, can you meet?" And I'd say, "Just text me when you're free and if I'm free, we'll talk." I stole this from Jason Fried at Basecamp, and because I'm allergic to calendars. And the reason I didn't want to have a calendar is because my 27-year-old daughter could show up and go, "Dad, it snowed 2 feet, let's go ski." And if I have an appointment with Michael Kitces and I have to choose between Michael Kitces and my daughter skiing powder, it's kind of an easy decision for me as much as I love talking to Michael.
Michael: I know, then we have to reschedule.
Carl: I've had to do that only, I think, twice, but it's almost always been... So anyway, that was one thing I considered on a stop-doing list. When I was an advisor, I wondered one time, like I forgot one time to send out quarterly performance reports. And I remember going home that weekend and I remembered on Sunday morning that I hadn't done it. And I was like, "Oh, no, people are going to be so mad." And you can guess how many complaints I had when I got into the office on Monday. Zero.
Michael: Nobody noticed.
Carl: Nobody noticed so I was like, "Whoa, turns out nobody was born expecting a quarterly performance report." So I put that on the stop-doing list. So we changed our ADV and said, "Hey, performance reports are available on demand." So to me, I'm wondering can I get away with, so I have 2 big stop doings that I'm working on. One is I want to never touch a keyboard again. And that's a little more metaphorical than it is, but I don't want to type, I don't want to write. I want to speak. So I'm building all the businesses around audio projects. Fascinating, right?
Number two, I didn't want to be in social media at all anymore. And so I'm not. The team is, but I'm not. And we're going on 2 weeks.
Michael: How's the withdrawal been?
Carl: It's actually been no problem because instead of resisting, I replaced. I got all these other cool things that I'm enjoying so much that I don't even think about it most days. So, and calendaring, I tried to get rid of all anybody of... I tried for about a year, have somebody take over my calendar. And I found that the algorithm in my head of why I want to do things when you don't know if it's snowed, you don't know if it's sunny, you don't know if I want to go climb a mountain, you don't know. It was so hard to hand off that I was like, I think keeping my own calendar is something I'll probably keep to myself because if I had a simpler algorithm, it'd be easy, but I don't. It's very complex. It's impossible.
Michael: As someone who's delegated their calendar, you can explain the algorithm to someone.
Carl: No, you can. I have not been able to do. Maybe it's just because you're way smarter than me. I've not been able to.
Michael: You like the weather, weather reports are public. It doesn't even need to be where you are to find out whether it's sunny today and whether there's fresh powder.
Carl: I have so many feelings about it, so many, because it could be literally like, I know the ski report's terrible, but my best friend just came in town and you didn't know that. And so I've just been really, so anyway, but I think...
Michael: If they were in your email, they would know that.
Carl: I think calendar and you know what? Maybe you're right. Maybe you're right. I'm doing pop-ups right now. Maybe you're right. Because I would love to never see my email again and never see my calendar again. So those are big ones on my stop-doing list.
How To Start Building A Stop-Doing List [26:24]
Michael: So for folks who are listening, where we may not be able to go quite as far as no more keyboards, no more social media, no more calendar, good to have goals, but for where most of us are today, how do you start building out your stop doing list?
Carl: There's 2 ways I've seen pretty effective that people who are much more systematic than I am able to do. And by the way, I'm not suggesting anybody else do no keyboard or no calendar, but what I would do is write down what you spend your time doing and then decide on the things that you don't like doing. I don't like doing that. You may love a non-client-facing activity, like actually geeking out over the financial plan.
Michael: Yeah.
Carl: You may love it, even though all the efficiency people and all the revenue people would tell you should be spending more time client-facing. You may love that. Well, keep it for heaven's sakes. Right? And you may be on the other end. So I would just write down the things you do on a daily basis. If you're finding yourself time-crunched, maybe do a time audit for a week. You could even install RescueTime. There's a million ways to do that. Install RescueTime for a week. Keep track of what takes your time. Do an old-fashioned CPA time audit, right?
Michael: Yeah.
Carl: Identify the things that you like the least, put them on your stop-doing list, rank them by the energy suck they are, which ones you hate the most.And then here's the steps. This is stolen and adapted from David Allen. Like delete, can you delete it? Sending out client quarterly performance reports was an example. I'm not suggesting that. I'm just saying it's an example. Turns out I could delete that. Well, maybe you can't delete it. Can you automate it, right? Do you have a person that you could turn to? There's lots of these cool efficiency tech people now that can be like, "Oh yeah, we could do this with a zap and that and that and that." Could you build a system to automate it? And by the way, is the system, once it's built, robust enough that managing the system isn't your new problem.
Michael: Right.
Carl: But think about that. Audit it. Can you automate it? Can you delegate it? So delete, automate, delegate. And then if you can't do any of those, you got to keep doing it until you can sort that out. So delete, automate, delegate, do. Again, David Allen sort of framework. That's how I've approached it. And then I love Dan Sullivan's suggestion. You pick the thing on the top of the list and you say to yourself and your team and anybody else who's around, "In 90 days, I will not be doing this." In an ideal world, you say, "In 90 days, I won't be doing this. Please figure out a way to make that true. What do you need from me?
Michael: Well, I like that framing.
Carl: Yeah. What do you need? This is one of my friends who's one of the most effective CEOs I've ever seen ever, ever, ever. He works for a huge turnaround, a private equity company that's distressed equity. So he goes in and becomes the CEO to turn businesses around. And he taught me that he's like, "I just get the team together and say, 'Here's the thing I need done. What do you need for me to make that happen? What resources, is it money? Is it an expert? Do you need me to connect you with somebody who can train you? What do you need?'" I love that.
Michael: I will echo from my end, maybe this is my own bias around it, but I can't speak highly enough of the time audit suggestion that you made. I find there's a version of this. It kind of reminds me of when we're trying to help clients that have, shall we say less than ideal spending choices that are better keeping them back from their goals. There's a version of this where we come and say, "You should spend less than you make and live within your means. And here's a couple of things that are really not good for you to be spending on that you should probably stop spending on." And it's really hard to get that advice through, right? Most people very quickly get very defensive.
There was a fascinating study that had come out, it's probably like 8+ years ago now that some researchers look so... Back in the day, Personal Capital was competing with mint.com as an alternative cashflow spending tracking tool. They also did a bunch of investment stuff, which was how they tried to get lead generation to call you and ask you to become a Personal Capital client. They had a really good spending tracking tool similar to Mint. And they brought some researchers in to analyze what is consumer behavior when you start giving them all this spending information, because they were trying to figure out how do you optimize the screens to help people make better spending decisions, right, and all the things that software companies go through.
And what they found was that the average user cut their spending by more than 10% in the first 6 months just because they installed the app and saw where their money goes for the first time, because almost no one naturally can really keep track of where all the dollars are going. And they just saw where their own money was going for the first time and out of sheer personal mortification began to change their behavior in very material ways. And it was a 10% spending change. If the country did that collectively and the national savings rate went up by 10%, our entire country would look different in its financial strength and stability.
But what they found was the intervention didn't come from all of their advisors calling people saying, "You should live within your means." It was literally just helping people see where their own darn money goes and letting their own personal mortification kick in because we all can usually see pretty quickly there are probably some places my money was going that it shouldn't be going if I've never been tracking it before. And I find the exact same thing happens when you start looking at your time, because a lot of the time I find even when we start going through the stop-doing list, as you said earlier, look, if there's a thing that's just driving you nuts that you absolutely hate to do that takes you 10 minutes, find a way to let go of it and make your life a little happier.
But I find for a lot of people is they obsess over the 10-minute tasks that they can't stand and completely miss the 3 hours a week they're wasting on this other thing that would be easily automatable or delegable. And they weren't even paying attention to it and realizing it because the brain was so fixated on the 10-minute thing that they don't like, that they missed the 3-hour easy change that would be massively altering to how much free time and flexibility they have in their week. And the only way you find that out is you do an audit, you go through for a week and find out by whatever means. Right? Some of us will probably write it down in a notebook. If we like to log, a journal. You can get tech tools like RescueTime or Toggle where you just put it on your computer and it helps you keep track of this stuff.
And it doesn't have to be perfect. You don't need to quite do this down to the CPA style track in 5-minute increments, although you can if you want. What you're probably going to find when you look at it is giant swaths of 30 minutes, 60 minutes, 1 hour, 2 hours, 3 hours that were going towards things that probably weren't ideal to be going towards and that you can start to make adjustments that really materially move the spare time needle for you or the flexibility time needle for you really quickly.
Carl: I've actually, I've never seen an exception to this. Install RescueTime on your computer, do it for a month. Don't change anything about your behavior. Don't even look at the reports. I've never seen an exception to this that people are, the word that is routinely used is "horrified". And it's cute that you think you will be the exception.
Michael: Yeah. Well, for most of us, I don't want to be the exception. It's I don't want to have to accept the hard medicine of what I'm going to see.
Carl: Yeah, no, I'm not talking to you. I'm talking to all the other humans that have fancy feelings like me that are like, "Oh, no, I don't waste that kind of..." Yes, I do and yes, you do. Screen time on your phones, horrifying enough. I did I did this with RescueTime reached out after a column I wrote and they're like, "Hey, do you know we have the software?" I was like, "Sure, put it on my computer. I'll make some predictions." What I did was I'm going to make some predictions about how I spend my time. And then I want you to put it on my computer and don't tell me about it for 30 days. And then they came back with the results compared to what I had said. It was the only word I could use too was horrifying. I was shocked, shocked at the amount of time that I was spending on things that I would have told you I never ever ever ever did.
I was like, "There's no way I do that." The average knowledge worker, us included, doesn't go more than 17 minutes without checking email. If you know anything about residual switching costs, which you do, it takes 10–15 minutes to get into a project, and then you're checking email every 17 minutes, you're basically getting... The average knowledge worker in this country is getting nothing done. And we're probably all at some degree, I bet listeners to this are way better than average. And there's still tons of room to improve. So I can't second that enough. And then the last thing I'll say on that is that result is, I think is really true. Awareness, simple awareness will drive behavior change.
Michael: Yes.
Carl: Without even behavior change being the goal, just simple awareness will drive behavior change. That's enough on that, Michael, don't you think?
Michael: I think so. Thank you, Carl. Thank you for the discussion.
Carl: Cheers, Michael. Thank you.
Michael: Cheers.
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