Mikael La Ferla on Why Waiting Until the End of the Month Makes Spending Harder to Control

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Many people wait until the end of the month to review their finances. According to Mikael La Ferla, that timing may be one of the biggest reasons spending habits become difficult to change.

Monthly bank and credit card statements provide a complete picture of where money went, but they do little to influence decisions that have already been made. By the time consumers review their purchases, every restaurant visit, online order, convenience purchase, and subscription renewal has already occurred. While reviewing statements can improve recordkeeping, it rarely changes spending that has already happened.

Financial habits are easier to adjust while they are occurring rather than weeks later. A household that realizes it has already spent most of its dining budget halfway through the month still has time to prepare meals at home or postpone discretionary purchases. Waiting until the monthly statement arrives removes that opportunity because every financial decision has already been finalized.

Consumer Financial Protection Bureau found that consumers who actively monitor their finances and understand their day-to-day cash flow report higher levels of financial well-being than those who do not. The report concludes that financial success depends not only on income, but also on having the ability to respond to financial decisions as they happen.

FINRA Foundation's National Financial Capability Study found that individuals who frequently monitor their financial accounts are more likely to demonstrate positive financial behaviors, including paying bills on time, maintaining emergency savings, and planning ahead for future expenses. Regular awareness throughout the month gives consumers more opportunities to make adjustments before small purchases become larger financial problems.

Mikael La Ferla believes technology has changed the way people manage everyday finances. Instead of waiting until the end of the month, consumers now have the ability to view spending in real time, allowing them to recognize patterns before they become expensive habits.

This is one of the reasons Shopden was created. Mikael La Ferla built Shopden to help consumers understand where their money is going throughout the month instead of only after it has already been spent. By securely connecting financial accounts through Plaid and automatically organizing transactions, Shopden provides continuous visibility into everyday purchases. The app's shared shopping lists also help households coordinate purchases before unnecessary spending occurs.

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