How does Profit First work?
|Apr 6, 2020|
We are told that we need willpower to reject temptation. That cake, that cigarette, spend the last £100 in your bank account. And all too often we break and we fail and we hate ourselves for our weakness.
But there is a growing body of evidence that our brains don’t work that way. We have many urges, generated to fulfil different requirements, some which work together and some which are in opposition to each other. Like our long term desire to lose weight versus our short term desire to eat that beautiful cake. Which desire wins out at anyone time isn’t a function of willpower but rather which requirement is the strongest.
So to make major changes you need to build your strength in the areas that you want to win and weaken the ones you want to lose. And the way we do that is by building habits.
There used to be a “stop smoking” ad that showed gloopy fat oozing from the cigarette. It helped me stop because as I reflected on that image it was strengthening the long term “don’t have a fag” part of my brain.
And if you can’t stop spending that last £100 in your bank account, if £90 is for your tax bill or your rent or whatever, lock it away. Put it in a separate bank account with a different bank and don’t install the app for it. Because that way, you’re weakening the “short term spend it” urge by giving it more work to do.
That last one is the heart of the #profitfirst method. You have one account you can spend from. Then you have separate accounts for your tax bills, your own pay and your company profit. Whatever is in your main account is yours to spend. Whatever is in the other accounts is locked away. Making a profit does not take willpower.