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Make meaningful improvements to your finances every week.

Now's your chance.

Make meaningful improvements to your finances every week.

resourcesfulness

The Science of Resourcefulness

Today we interview author Scott Sonenshein on his book about the science of resourcefulness.

Scott Sonenshein is the Henry Gardiner Symonds Professor of Management at Rice University. His new book Strech: Unlock the Power of Less-and Achieve More Than You Ever Imagined gives us a new way to succeed in business and in our lives by using the science of resourcefulness.

Chasing or Stretching

How do we define success? For many people success means more; more money, more stuff, more employees. But that definition is wrong.

There are two approaches to resources; chasing and stretching. When we chase, we tire ourselves out going after more, more, more. When we stretch, we use the resources we already have available. When we stop chasing and start stretching, we are better able to solve problems and innovate which means we are more fully engaged in our endeavors.

Necessity is the Mother of Invention

Remember when you were a kid and you could spend a whole afternoon playing with things that were not store bought toys? Building forts out of boxes or making drums out of oatmeal containers and turned over pots? When we were kids and used things we already had, our play was more creative and imaginative.

The same is true for adults. When we stretch the resources we currently have; time, money, relationships, we are more creative, more successful, and more fulfilled.

Mo Money Mo Problems

Sometimes is can seem like the more you have of some things, money, time, stuff, the more problems you have. When you have too much money (a hard concept for most of us) you might have relatives who think they can use you like an ATM. When you have too much time you might over eat or drink out of boredom. When you have too much stuff your home might start to look like an episode of Hoarders.

We thought those things would make us happy but often, they make us unhappy because of all the problems they cause that we didn’t foresee.

The Personal in Personal Finance

Sometimes we forget the personal in personal finance. Your goals should be personal; they should be helping you to work toward what you want. That means you don’t copy or compare yourself to others. Your neighbor bought a new car so you did too. But did you want a new car?

When we keep chasing things just to keep up with those around us, we feel unsatisfied even when we manage to acquire them because they weren’t the things we wanted. If your ultimate goal is financial independence, how is buying a brand new car going to help you achieve that?

It’s natural to compare ourselves against those around us; it can be a way to measure how well we’re doing. But a comparison to others shouldn’t be our only measuring stick.

Mindless accumulation is not a goal. Getting more resources is not a goal. Resources should be a means to an end, not the end themselves.

Artificial Constraints

If you need to leave for work at 8:00 and you wake up at 6:30, it takes you an hour and a half to get out of the house. But what happens when you wake up late, at 7:15 instead of 6:30? Are you 45 minutes late for work or do you somehow still manage to make it out the door by 8:00?

More often than not, we somehow figure out a way to manage with what is available to us at the moment. This kind of constraint breeds creativity.

A good exercise that demonstrates this is to take a look at your budget for the next month. Vow to cut 10% of your spending for that month. That might mean bringing your lunch to work rather than buying it out, taking public transit to work rather than driving and having to spend money on gas.

It’s been proven that we are made happier by experiences than things. It almost always takes money to acquire things, but there are many experiences that can be had for free. When you cut that 10% from your budget, you might have to cut your weekly dinner and movie date. That doesn’t mean you have to cut the date entirely, but you have to find something free or inexpensive to do.

Nearly any of the ideas in this article will cost less than a typical dinner and movie date and be much more fun and memorable.

For your next project at work, impose a deadline that is three days earlier than the one your boss gave you. See what you can do with less. The side effects might be interesting. Maybe taking your lunch to work not only saved you money but made you lose a few pounds too.

Maybe taking public transit to work led you by a park that you had never visited. Finishing a project under a tight deadline and you might find that you left work earlier because you spent your time at work focused on the project and not interrupting the day with forays onto Facebook and Reddit.

Only So Many Hours

Rich or poor, we all have the same 24 hours a day to work with. Lack of time is the excuse a lot of us give for a lot of things. We don’t have time to work out, to start a business, to spend more time with our families.

Part of the problem is that we lie to ourselves about how we really spend our time. The average American spends more than ten hours a day consuming media via some screen, our computer, our phones, our televisions.

Ten hours! That’s nearly two full-time jobs a week worth of time. Can’t you use a few of those hours to work towards something you want to do? Whenever you see those lists about the habits of rich people, then hours watching television is never on the list.

But Breaks are Important

You want to use your time productively but that doesn’t mean you aren’t allowed to take breaks. In fact, a break can help you come up with creative solutions to a problem.

If you’re struggling with something, the productive thing to do is not to sit in front of it going over and over it in your head and getting nowhere. Get away from it for a bit; do something mindless like play a game of solitaire on your computer or better yet, get outside for a bit and go for a walk.

Clearing your mind will help you come back to whatever was stumping you with a fresh perspective.

Just Do It

Sometimes we spend so long in the planning stage that we never actually get started doing the thing we are planning. It’s easy to become paralyzed when you try to plan for every contingency. Sometimes you just need to get stuck in.

When you start doing something, even if you don’t have a perfect plan, or any plan at all, you will learn as you go. You will make mistakes and learn from them. And you will feel more fulfilled because action always makes us happier than inaction because it gives us a feeling of power.

 

Frugal vs Cheap

Being frugal and being cheap are not the same thing. Cheap people hate to spend money, some even fear it. Frugal people don’t mind spending money as long as it’s money well spent. A cheap person will buy a kitchen knife from the dollar store. In three months they’ll have to buy another because the cheap one broke.

A frugal person will buy the best knife they can afford or save up for a quality one. That knife will last for years. In the end, the frugal person will have spent less because they didn’t have to replace a cheap, flimsy knife over and over.

Do More With Less

That’s the whole point of this book. When we make do with what we have, rather that is time, money, or stuff, we will be happier, more creative and more successful. Choose one area of your life this week to make do with what you have and see if that holds true for you.

Show Notes

scottsonenshein.com/book: Where you can find Scott’s book.

Mint: Start budgeting today.

 

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