How to ‘Front Load’ Your Financial Choices to Avoid the Impact of Decision Fatigue

One simple phenomenon I’ve noticed over the years when it comes to my worst spending choices and financial decisions is that my worst decisions always happen late in the day. I’ve discussed this before when describing decision fatigue in the past and yet, even though I generally understand decision fatigue, it’s perhaps the source of my biggest financial mistakes over the past few years.

Having said that, in the last few months, I think I’ve stumbled upon a few techniques that really work well for me and have made a profound impact on my financial life.

Let’s start from the beginning.

What Is Decision Fatigue, and Why Should I Care?

Decision fatigue refers to the well-established fact that people tend to make worse decisions when they’ve made a lot of decisions without rest. In other words, if you’ve had a long day, your decisions in the evening are usually significantly worse than the decisions you make in the morning. Fatigued decisions tend to rely a lot more on impulse and emotion, involve a lot less information gathering and consideration of what information you do have, and often have very little consideration for the long term.

If you think about this phenomenon in your own life, many of your worst choices and personal mistakes have likely happened later in the day. You’ve probably made some professional errors late in your shift or while working overtime. You’ve probably made personal and financial mistakes late in the day or when staying up late. It’s okay – it happens to all of us.

The model I like to use when thinking about decision fatigue is to think of my mental capacity for making decisions as being like a muscle group during exercise. The first dozen or so repetitions of a particular exercise are easy and it’s quite easy to do them with good form. However, when I reach the 50th repetition or so, I’m starting to wear out. My form gets sloppy. I might cheat a little. I’m a lot more prone to injury. What I really need to do is rest that muscle group for a while.

My decision making capacity is a lot like a muscle group, and decisions are a lot like exercise. My first decisions are well-executed, but as I do more and more and more of them, they start to get sloppy. I’m a lot more prone to making decisions on an emotional whim, or drawing bad conclusions from a limited amount of information. What I really need to do is rest my faculty for making decisions – in other words, I need a good night of sleep.

The problem is that immediate sleep when I notice decision fatigue setting in (and I usually don’t immediately notice it, to tell the truth) isn’t usually an option. I have additional tasks that need to be completed and additional responsibilities that need to be carried out. I can handle those tasks well enough – they’re usually simple ones – but if they involve significant decisions that aren’t screamingly obvious, it gets more and more likely that I’m going to make a really bad decision.

If you’d like to read more about decision fatigue itself, this article from the New York Times provides a good summary.

Eight Simple Steps for Handling Decision Fatigue

For me, the best solution I’ve found for making sure that decision fatigue doesn’t create adverse effects in my life is what I call “front loading.” In effect, it’s all about making sure that the meaningful decisions I make in a given day, particularly those with financial impact, are done early in the day. Making sure that such “front loading” actually happens is the challenge, though; our natural instinct is to keep making decisions all throughout the day until we roll into bed.

My general principle is this: the decisions I make late in the day should all be ones where the negative consequences are low. Decisions with large consequences should be made earlier in the day or postponed until the next day.

I’ve been striving to do that in my life over the last several months, using a set of eight consistent strategies, and it feels pretty successful, not only for my finances, but for my general quality of life. Here’s what I do.

The Pocket Notebook: I record and postpone all significant decisions that I am faced with after the mid-afternoon (if possible) until the next day by simply writing them down as a list. Once the day starts winding into the middle of the afternoon, I consciously recognize that my decision making abilities are starting to get worse, whether I consciously recognize it or not. At that point, I start trying to postpone every meaningful decision that I can to the next day.

If I’m going to make a financial decision, I instead write it down in my pocket notebook so that I’ll review it the next day. If I’m considering buying something, I write it down in my pocket notebook. In fact, if it’s any kind of decision that has any real importance in my life, I write it down in my pocket notebook.

Going through that pocket notebook and handling all of the decisions that I’ve written down is part of my morning routine, which I’ll discuss in a minute. The key thing to remember here is that by default, I defer all late day decisions by writing them down and handling them the next day.

The Postponement: I intentionally save tasks that require little decision making for the end of the work day and the evening, things such as small household chores, email reading, and meal assembly. This is actually very similar to my strategy of writing down decision-heavy tasks for the next day. Instead, here I postpone tasks that require little or no decision making for the late day – in general, the only decision that these tasks involve are centered around simply doing them at all.

That’s why, throughout the day, dishes will often pile up in the sink, because doing dishes is a task that I almost always postpone until late in the day. Laundry sits in the basket until the evening. Reorganizing a bookshelf or a closet is another task that will wait until evening, though I don’t make a final decision about throwing anything away until the next day (I just make a big pile of questionable items and add the final cleanup of that pile to the next day’s to-do list).

The ideal evening task for me is one that involves no real decisions of any consequence. Once I start doing it, I’m basically on autopilot until the task is done. I can do things like loading the dishwasher or taking out the trash or chopping vegetables for tomorrow’s dinner without even consciously thinking about it, as long as I have a list of tasks to do.

In fact, I actually have a tag in my task management tool – “low energy” – that I toss on tasks like these. When the evening comes around, I just pull up my list of “low energy” tasks and get to town. Those tasks never involve any real decisions of any kind, so decision fatigue never has a chance to make a negative impact.

The Path of Least Resistance: I put effort in early in the day to clear the runway for decisions and tasks that might go awry late in the day. There are many situations that pop up in life where decision fatigue can really rear its ugly head in the evening. Our weeknight family dinner is a great example of this.

If I haven’t really done anything to prepare for our family dinner earlier in the day and it’s suddenly time to start preparing supper, my decision fatigued brain evaluates the situation and will almost always go for the “path of least resistance,” which often involves just grabbing food from a restaurant because that seems like the least amount of energy I can spend.

However, if I “clear the runway” earlier in the day by deciding what we’re going to have for dinner in the morning and actually taking action to finish that dinner easily in the early evening, then it becomes a much easier decision. I’ll put supper in the slow cooker or do a lot of the initial prep work while my kids are finishing breakfast and heading for the bus, so that my decision is already somewhat pre-loaded for me. There’s much less resistance to making dinner, so that’s what I’ll choose in my decision fatigued head later in the day. “Hey, dinner’s in the slow cooker, so we don’t have to go out to eat” or “Hey, the casserole is already assembled in the fridge so we don’t have to grab takeout” or “Hey, all of the stir fry vegetables are cut up in the fridge, so we don’t have to order delivery.”

The Commitment: Rather than allowing myself to make late-day decisions, I try to make specific commitments to others. Often, I’ll simply tell Sarah that I will take care of specific things in the evening, or I’ll tell my child that I’ll do so, and then I just write down those tasks.

At that point, I’ve even eliminated the decision of whether or not to actually do those tasks. I’ve made the commitment already, so it’s just a matter of actually doing the task in the evening.

If the task involves a decision, I make that decision early. I might send my wife a text like this: “Hey, Sarah, I’ll prep the vegetables for tomorrow’s stir fry and clear out the dishes when we’re back from the school band concert this evening.” At that point, I’ve committed to two tasks that will fill up a chunk of my late evening – that commitment means I’m going to do them, so I don’t even have the decision late in the day to skip out on them.

This is easier to do if you have a spouse, kids, or a roommate as they’re good targets for your commitment.

The Checklist: I rely heavily on checklists throughout the day so I don’t have to over-exert my decision “muscle.” I am a huge, huge believer in checklists. If you’d like to read an amazing argument on behalf of using checklists in your daily life, read Atul Gawande’s excellent book The Checklist Manifesto.

In a nutshell, the purpose of a checklist is to offload the thinking about how to best execute routine tasks. You spend some time very carefully thinking about how to do certain things as well as you possibly can, then you write up a checklist that covers each step, then when you need to do that task, you don’t think about what’s next. Instead, you just follow the checklist and focus instead on the task at hand.

I use checklists constantly. I have a “startup routine” checklist (which I’ll talk more about in a bit). I have a “kids home from school” checklist. I have a “evening cleanup” checklist. I have a bunch of checklists related to my professional work, including a master checklist that covers all tasks needed for a week of writing.

These checklists all center around offloading actual decision making for the routine tasks of my day, so that I can focus my decision making on important things. I’d rather be super careful in thinking through a daily routine just once or twice a year rather than having to mentally go through all of those decisions each day.

The Startup Routine: A big part of my daily startup routine (both personal and professional) involves going through a lengthy checklist, part of which involves processing decisions left behind from yesterday. Perhaps my most important checklist is my “startup routine,” which is basically a mix of a morning routine that I do every day along with a workday startup routine that I do on normal work days. It’s a surprisingly long checklist that usually takes me two to three hours to work through (remember, though, that it includes parts of what everyone does normally in the morning, like taking a shower and making the bed among other things).

The reason this list stands out is that many of the items are decision prompts so that I can set things in place for the rest of the day. For example, one item is “What’s for dinner? Do things to make it easy.” Another is “What are the three most important things you’ll do today? Schedule them early.” Another is “Go through and take any needed action on everything not crossed off in my pocket notebook and Evernote inbox.”

In other words, I incorporate a lot of the strategies in this article directly into my morning checklist. By doing those things all in the morning, when I don’t have decision fatigue, I’m very likely to make good responsible choices for those tasks. So, my morning routine involves a lot of the decisions I know I’ll make during the day, as well as prompts to address other decisions I need to make today.

The Big Sleep: I go to bed early enough so that I essentially don’t need an alarm to wake up. Decision fatigue goes away after a good night of rest. Good rest takes care of all kinds of fatigue – you just feel better about everything, make better decisions, handle focused tasks better… it goes on and on.

My goal most nights is to go to bed early enough that I don’t need an alarm to wake me up when I want to wake up. Yes, this makes me into one of those “early to bed, early to rise” types, but when I get up from my slumber, I’m usually ready to tackle the day with enthusiasm and energy and a clear mind.

In the same vein, staying up later almost never achieves anything worthwhile. The one exception is when I stay up late purely for face-to-face social purposes – we have friends over for a dinner party or game night that runs late, an old friend or a relative is staying at our house and we stay up late talking, and so on. Online conversation is not a substitute for this – turn off those devices an hour before bed, at least. The only device I like to use anytime close to my bedtime is my Kindle, which is basically just a book.

The Big Buy: I try to make every single decision that involves spending money within the first few hours of waking. This is my general policy, and it’s one that’s backed up with my morning routine and by choosing high-priority tasks for the day.

If I’m going to shop, I want to do it in the morning. If I’m going to pay bills, I want to do it in the morning. If I’m going to make an investment decision, I want to do it in the morning. Doing those things in the afternoon or the evening means that decision fatigue is at work and I’m virtually guaranteed to make a worse decision.

Thus, each day, part of my morning routine is to make a list of key tasks that need to be done for the day, and any tasks that involve money are designated as “morning” tasks, things to be done first. Often, those are done on Saturday mornings so that I don’t have any professional tasks interfering with it. If it’s a financial decision, I do it early.

Final Thoughts

These eight strategies essentially make up a system that helps me to avoid making financial decisions or other potentially costly decisions late in the day when my decision fatigue is weakest. The big “kicker” for me in putting this all together was the realization that I could really incorporate a lot of decisions for a given day into my morning routine by actually directly including them or by reminding myself to intentionally move tasks that require a lot of decisions and focus to the early part of the day, and then to simply write down tasks and decisions late in the day to be handled the next morning.

Having done this for the last several months, I can truthfully say that it’s helped greatly in terms of helping me make more rational decisions about my money. I basically don’t make money decisions after the mid afternoon any more, and that means that I don’t find myself standing in the grocery store feeling tired and throwing a bunch of stupid stuff in my cart. I don’t find myself clicking “buy buy buy” at e-commerce sites because I just write down anything I was thinking about buying and reconsider it the next day.

Move your decisions to the early part of the day, and bookend it with some good sleep. You’ll be glad you did – and so will your wallet.

More by Trent Hamm:

Trent Hamm

Founder of The Simple Dollar

Trent Hamm founded The Simple Dollar in 2006 after developing innovative financial strategies to get out of debt. Since then, he’s written three books (published by Simon & Schuster and Financial Times Press), contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.