Are You Spending Your Money on All The Wrong Stuff?
Re-posting an oldie but goodie from this site’s early days. But this time, to help you put it into practice, we added a free template (grab it HERE, no opt-in required) to help you align your spending with what’s important to you.
Chuck Palahniuk, the author of the novel-turned-movie, Fight Club, once said “If you don’t know what you want, you end up with a lot of what you don’t want.”
That, to me, sums up why many of us live in perpetual states of overwhelm. We’re walking around with a lot of what we don’t want and not thinking twice about it. We only know we’re craving simplicity.
What’s happening is, we’re living in default mode, letting life come at us. But if we take stock of what we want, we’ll have more of what we want in our lives. And be much happier for it.
Do you have a lot of what you don’t want?
A woman I met—let’s call her Rosemary—woke up one day and realized she never bought the home she promised herself two years prior. At age 33, her six-figure salary made the dream possible, but she was living paycheck to paycheck. Where did that money go? Her answer: “Clothes, the latest gadgets for the kids, birthday parties, a new car—all things I could justify at the time. I had a lot of stuff, but not my house.”
While the stories and decades may differ, the issue is the same for many of us. Maybe life is good, but it’s not in sync with what you want most. Maybe you want to give more time or money to your favorite charity, or to your family, or start that business or write that novel. Maybe you simply want to be the best at something. All the while, you’re running on the proverbial treadmill, never stopping long enough to think about what you want, and more importantly, what you value. Yet, it’s only then that you’ll be driven to accomplish your goals.
So step away from the merry-go-round of overwhelm. Read on to find out how you can start creating the life you want.
What exactly are values?
Put simply, your values are what’s important to your heart and soul. They’re different from goals. A goal is wanting to buy a house. A value is what that house represents for you—for example, your future security, your family’s security, your sense of independence, or maybe it represents something else deep inside you. For Rosemary, a house meant a warm, stable environment for her kids to grow up in because her parents never owned a home. She finally bought the house last February after sitting down with a financial advisor who got to the heart of the matter.
If you don’t know what’s important to you and whether your financial decisions are aligned with those values, you could be wasting a lot of money and years making unconscious decisions. Spending on things that have absolutely nothing to do with what really matters to you.
Besides the feeling of spinning your wheels, that has consequences.“If the way we handle money conflicts with our personal values, we are not going to wind up living happy and fulfilled lives,” writes David Bach in Smart Women Finish Rich.
Your most powerful inspiration
What are your heart and soul goals? It’s not an easy question, but “understanding what you’re looking for in life is the foundation on which all smart financial planning is based,” writes Bach. When it comes to planning, you think of getting out of debt, investing, preparing for college or retirement. But you also need to know why those goals are important—the heart and soul reason, such as independence, peace of mind, happiness, helping others, realizing your potential, or helping your children realize theirs.
Of course we all value all of those things. But we each have our own idea of what a good life looks like for us, and why. A good place to start is to think of one thing that’s a priority for you. Then break it down. For example, you may think, “I value financial independence.” Then dig deeper. Ask yourself “Why is that so meaningful to me?” Maybe your mom dreamt of being an opera singer and never got to live her dream and that deeply affected you. Or maybe you’ve always wanted to see the world. In your deepest values you’ll find your most powerful inspiration.
Remember your reasons.
Once you’ve mined your values, “stay in touch with what matters to you, and your sense of what it means to live a good life” says certified financial planner, Karin Maloney Stifler, founder of True Wealth Advisors, LLC in Hudson, Ohio. Stifler runs long-distance races, and recently about a mile before the finish line, as she was feeling runner’s fatigue, spied a giant poster that said ‘Remember your reasons.’ A powerful mantra for your money as well. “Sometimes we’re making hard choices in life, and if we remember our reasons, we stay focused,” she says. Stifler suggests posting affirmations, goals and reminders about what’s important on the fridge, computer screen or the sun visor in your car. “Keep them present in your mind at all times.”
Pay attention to your choices.
Create an accountability system for yourself. Before you spend money on anything, whether it’s a new pair of jeans, a new TV, that bigger house you’ve been coveting, ask yourself if it’s in line with your values. Will this get me closer to financial freedom? Will it help me make a difference, help my family, write my novel, start my business, live a good life? If you don’t have a good answer, think twice. And if you decide to go ahead with it, at least it will be a conscious choice.
Think about your 5 most important values. Does your spending reflect them or take you away from them? We’d love to hear from you in the comments below.
Don’t forget to grab the free PDF here–it has an exercise to help you get more mindful.
If you found this article helpful, please Like, Tweet & Share. (Not only do we appreciate the feedback, but it helps inspire others). Thank you for reading!