How Commitment Makes You Money
Using cliches is a cliche... but that doesn't make them less valid in the right context!
I don't usually delve this deep into my bag of motivational speaker clichés, but this one is actually critical in our context.
What is commitment?
Commitment is a two-part process: the promise and the follow-through. It spans from the moment the original promise is made until everyone involved agrees that the promises have been kept.
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Who do you make commitments to?
For everyone reading this post, you probably make commitments to too many different people. Commitments need to be followed up with agreed-upon actions, or else the concept becomes meaningless (as we will discuss later).
It's okay to tell people, "I would love to do X on date Y, but I'm not sure if I have the time." This is much better than saying, "Yeah, let's 100% do X on date Y" and then ending up overbooked or ghosting the person you're talking to.
How does "commitment" actually impact my finances?
Commitment is actually the most important thing in finance, whether it's personal or corporate. As we discussed previously, the little bits of paper, plastic, and electronic transactions we exchange for food, housing, etc., have no intrinsic value except the value we assign to them. The "we" here refers to the collective effort of millions of people fulfilling their promises. This transforms what initially seems like mere faith into the economic energy that powers our means of production.
Regarding YOUR finances, your ability to commit is measured by a credit score. We will cover this in a separate post, but a credit score measures whether you have successfully upheld your contract with the bank to repay your loans (credit cards, mortgage, personal loans) and by how much. A good credit score allows you to qualify for larger loans, giving you the opportunity to make more money if you start a business or enjoy a more luxurious lifestyle with less effort.
The more people who fulfill their promises to the bank, the stronger and more stable the financial system becomes.
Additionally, agreeing to attend someone's networking event and actually showing up strengthens your connections with that individual, making them more willing to assist you in the future. This concept is sometimes referred to as a social credit score, which was brilliantly portrayed in an episode of Black Mirror. More commonly, we call it social capital—the ability to achieve tasks with others and gain attention without having to spend money on it.
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I have commitment issues... How do I fix this before it becomes a problem?
If you recognize that you have commitment issues, chances are you may have lost some social capital or encountered difficulties at the bank—both of which are problems in themselves.
The good news is that commitment is a lifestyle choice you can make at any time. The easiest way to start is by committing to smaller, more flexible things. The next time a friend asks you to go out, respond to them and let them know if you can or cannot go—and then follow through. Don't let FOMO get in the way.
Gradually, you can progress to larger, less flexible commitments like student loans and credit cards, which will eventually lead to securing a mortgage.
Remember, it's okay to stumble and lose focus as long as you remember to get back on track (like being 3 minutes late with your newsletter!)
Final thought
Commitment is one of the most important character traits you can develop, and fortunately, it is also one of the most straightforward. Either things happen or they do not.
As for me, I have committed to writing two finance posts per week—every Monday and Wednesday.
Creating a public routine of your own is one of the best ways to commit to strengthening your commitment because you have friends and peers watching, often a more powerful driver of action then our own internal drive.
If you know anyone with commitment issues, share this post to help them get on track!