While everyone dreams to turn their financial goals into reality, it is disheartening to know that 65 percent of Americans, according to CNBC, save little to almost nothing towards achieving these goals. Little does anyone in the ‘65% club’ realize the danger that this financial irresponsibility puts them in. Undesirable situations such as having no workable budgets, rising debt rates and having little to no funds to offset a huge emergency are becoming the norm.
The truth is, however, that not everyone can exercise the same level of financial responsibility. Sometimes all it takes is some motivation to get you started. If you struggle with saving finances and consider yourself a spendthrift, then gamifying your saving goals may be the right solution for you.
Here are a few details about gamification and how it will enhance your saving goals:
Games have almost always taken center stage in the lives of most people while growing up. In fact, they are commonly used in schools today to deliver complex ideas in a manner that resonates with the student. In finance, gamification can be used to train someone to be financially responsible.
By setting small financial goals which you can reward yourself after achieving, you too can add it to your list of secrets to saving money every month, as shared by Need Cash Now. The rewards will keep you motivated and focused throughout any financial period. For instance, you can aim to save a dollar for every cup of espresso you take, and buy a sofa after reaching a particular amount.
It’s All about Psychology
Whenever you have a good experience, such as being rewarded for something, your brain produces dopamine, a happiness hormone. Since the human brain is wired to respond to pleasure over pain, you will typically find yourself drawn to anything that heightens your dopamine levels. This is exactly what games do.
The goal is to offer yourself tangible rewards through either using common financial gamification apps or setting your own rules for the games, according to Policygenius. However, the rewards shouldn’t necessarily be consistent. Since getting the same reward every time can be counterproductive and monotonous, vary the rewards as the goals become easier to achieve to shift to a more beneficial game.
Gamification Is Not New To Finance
Surprisingly enough, gamification is not new to finance, and it has been used for decades by financial institutions to increase their customer engagement and loyalty rates. Think in the line of credit card rewards and interest rates for saving in a bank. In a nutshell, achieving such goals creates imaginary gaming levels for their customers who work so hard to reap from using their services.
This often results in a win-win situation – the institutions gain more customers and profits while the customers gain rewards. The good thing about using this to enhance your saving capacity is that you set your own rules, boundaries, and rewards. Typically, a good reward should elevate your will to save instead of making you feel demotivated.
Enhance Both Intrinsic and Extrinsic Motivation
Set games according to your personality to avoid friction. For instance, a perfectionist will feel intimidated whenever they fail to achieve even the slightest part of their goals. On the contrary, an individual who doesn’t thrive in competing will feel demotivated in case the game pits them against their friends and colleagues.
The trick is a game that will enhance your internal (intrinsic) and external (extrinsic) motivation simultaneously. While the tangible rewards will strengthen the urge to save more, you ought to feel motivated to carry on after achieving a goal, according to insights from Very Well Mind.
Gamification is by no means a surefire way to achieving your financial goals, but it certainly adds some fun to saving. Your success in using it as a strategy trickles down to your commitment. Consider using gamification to embrace financial security.