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You’ve mastered managing your finances: a budget is in place, you've got a savings plan, and your debt is under control. But what comes next? This is often when people with solid financial habits start to falter. If you've reached a plateau in your financial journey, it’s crucial to maintain focus and keep pushing forward. Here’s how.
Why it’s a problem
At first glance, a plateau might not seem concerning. Things are proceeding as planned, so why worry?
The issue arises when people lose interest in their finances at this stage. Don’t misunderstand—finances don’t need to be thrilling. In fact, we highly recommend automating them so you can spend less time worrying about them. However, boredom can lead to some serious setbacks if you’re not careful.
First, it’s easy to lose sight of your goals at this stage. The initial excitement has faded, and you’ve forgotten just how important it was to take control of your finances. Your motivation has diminished, and you slip back into your old, careless spending habits.
Another issue is that your goal can become stagnant during a plateau. You stop letting it evolve. For instance, I went through this myself not long ago. I had optimized my budget, automatically saved part of my paycheck, and still had some fun money to enjoy. Everything seemed on track, and I didn’t have to think too much about my finances. But then my income grew. Rather than putting more money toward my goal, I spent the extra income because I was so accustomed to not worrying about my plan. The result? I ended up mindlessly spending the extra income (mostly on dining out). There’s nothing wrong with that, but I’d prefer to put my money to better use.
It’s also easy to feel restless during this phase. We want to push our finances further, but we know there’s only so much to do at the moment. It’s a dull phase. To break free, you need to make the most of your plateau and move past it.
Set smaller, exciting milestones
If your financial goal, whether it’s paying off debt or saving for something, feels too distant, make it feel more immediate with smaller milestones.
Let’s assume you’re finally earning enough to pay off more than just the minimum on your $20,000 student loan debt. You decide to create a long-term plan to tackle your debt. However, it's easy to put the plan on autopilot, lose sight of it, or forget about it altogether. To prevent this, aim to pay off $3,000 worth of debt each year (or whatever fits your budget). This keeps your goal front and center, making you more likely to stay on track and even increase your payments if you stay engaged. Keeping the goal short-term can help prevent boredom and keep you motivated.
And don’t forget to celebrate. Once you reach your goal, take a moment to enjoy the achievement with a little ritual—whether it’s cracking open a cold one, treating yourself to a massage, or sharing the news with someone who cares.
Even if your goal is simply financial stability—getting to a place where you’re comfortable with your money—celebrating your progress can help keep you motivated and connected to your finances.
It also helps to make your goal exciting. I know, the term 'financial goal' doesn’t exactly excite you. But when you think about it, eliminating debt, building an emergency fund, and preparing for retirement are all about taking control of your money, which is pretty exciting. Your goal should inspire you; ask yourself why it matters to you. To keep it motivating, ensure your goal is both specific and achievable.
For instance, instead of a goal like 'get out of debt because it’s the responsible thing to do,' which doesn’t really get you excited, try something like, 'Pay off $1,000 in credit card debt this year so I can start saving for my trip to Rome.' It's specific, attainable, and way more fun. The plateau isn’t so hard to push through when there’s a trip to Rome waiting at the end.
Introducing a challenge from time to time can keep your long-term goals actionable. Whether it’s saving a bit more each week, requesting a raise, or negotiating monthly expenses, tackling an occasional challenge can give your goals a serious boost. Join ours!
Beware of the 'Why Am I Doing This?' Phase.
During the plateau phase, it’s common to experience a mini-existential crisis, also known as the 'why am I doing this?' phase.
Once the excitement of financial security fades, restlessness sets in, and you begin to question the purpose of managing your money at all. To overcome this mindset, shift your focus to your personal motivation, rather than the end result of your goal. As Avidium, performance analysts, explain:
Concentrate on why this goal truly matters to you. Your reasons could be born from a significant challenge, your own pain, someone else’s struggle, a mental image, etc.
Take a moment to really think about your reasons, and try to make them as emotionally charged as possible, as emotions drive us all, regardless of how rational we may believe ourselves to be. Avoid focusing on the benefits here... Instead, simply note why this result is important for you to achieve.
For instance, if your goal is to eliminate debt, sure, the outcome is financial freedom, which is fantastic. It’s responsible and wise. But why does this matter to you? Your answer could be something like:
Because I don’t want to be constantly harassed by debt collectors for the rest of my life.
Because I want to improve my credit score so I can purchase a home in the next few years.
Because I’m tired of wasting money on interest when I could be saving for my dream vacation.
Once again, during the 'why?' phase, it helps to make your reasons clear and achievable. Reconnect with why this goal is so meaningful to you.
Learn to Love Your Routine
You can make your goal more exciting with little actions here and there, but eventually, you’ll face the same old monotonous routine. There’s only so much celebration to be had when you’re saving for a retirement that’s decades away.
Rather than fighting this, learn to embrace it. We often focus solely on the outcome of our goal and define success by reaching that finish line. Instead, shift your focus to the process itself and define success in terms of that. As James Clear puts it:
However, when you observe people who consistently hit their goals, you begin to realize that it’s not the events or results that set them apart. It’s their dedication to the process. They fall in love with the daily routine, not the isolated achievement.
Embrace boredom. Embrace repetition and practice. Fall in love with the journey of what you do, and let the outcomes take care of themselves.
Focusing on the process is especially valuable when it comes to adapting your goal as life changes. Whether you get a raise, lose a job, or have children, allow your goal to evolve along with these changes. This keeps it relevant and achievable.
Going back to the fundamentals can help you regain focus on the process. The Art of Manliness explains:
Sometimes changing things up can break through a plateau, but in my experience, I often end up wasting time searching for that new magic trick to make everything better. Instead of searching for the new, I turn back to the basics. When I hit a plateau with my writing, I revisit my composition skills by doing exercises from a book. When I plateau with my weightlifting, I lighten the weights, concentrate on my form, and gradually increase the load again… On numerous occasions,
I've found that even when you’re advanced, revisiting the basics can offer fresh perspectives that push you forward even further.
This approach applies to nearly every goal, but it’s especially important when it comes to personal finance. As you grow more knowledgeable about money, it becomes easy to overlook the fundamentals. For instance, I recently reevaluated my budget and noticed that I wasn’t being nearly as frugal as I once was. That’s fine—personal finance is about more than just frugality, and over the past year, I’ve focused more on increasing my income than on saving. Yet, I also realized I’d become somewhat careless and thoughtless with my spending because I had overlooked one of the simplest, most fundamental rules of personal finance: spend less. When I reassessed my budget, I saw that I could be saving a lot more money without feeling a difference. And now, with greater financial insight, I also recognize the opportunity cost of not saving.
Look into the Next Step
If you feel like you’ve mastered your current financial situation, it might be a good idea to research what’s next.
When I was working to pay off my debt, I already knew that my next financial target would be saving for retirement. So, I researched investing, 401(k)s, and how to establish a portfolio. I didn’t grasp everything initially because you truly understand investing once you start doing it, but I knew the starting point when the time came. Researching the next phase helped me learn, sure, but more importantly, it kept my focus on the end goal.
Your next financial step might be facing your growing student loan debt. It could be saving for a home down payment. Whatever your goal is, doing some research will help immensely when it’s time to take action.
The plateau can feel monotonous and uneasy. But that’s actually a good sign—it means you’re ready to move forward with your finances. That’s wonderful! Still, it’s easy to forget about the journey when it doesn’t feel like you’re advancing toward the peak. If it seems like you’re stuck waiting and itching to take more action, these steps should help you stay aligned with your overall financial plan.
Photo by ra2studio (Shutterstock).
