So, let’s look at what our values have been until now. Listed below are examples of questions you can ask yourself to gain clarity of the unconscious (or conscious) values and behaviors that have led you so far.
- What is my proudest financial decision?
- What is my biggest financial regret?
- What’s been the best use of my savings?
- Do I have an emergency fund?
- Have I prioritized investing?
- Am I knowledgeable about investing options appropriate for me?
- Who is my role model when it comes to money?
It’s okay to confidently answer all of these questions. It’s also okay to answer less confidently and take full responsibility for your answers either way. The goal, for now, is to accept that our current financial situation is the result of our previous financial plan, or lack thereof.
After Acceptance Comes Clarity
As we accept that we are the masters of our past, we can now become the masters of our future. How do we do this? As Stephen Covey taught, let’s “start with the end in mind.”
Money is a tool. Just as rulers measure length and thermometers measure heat, money measures economic value and allows us to exchange it. However, this tool needs a purpose to be useful.
So, what will be the best use of your money?
Let’s review a situation between two people. The first person is a boy named Rob. The second person is a girl named Sue. Rob has $100 in cash. Sue has $1,000 in cash.
Rob knows exactly how to spend his $100 bill. He goes to his favorite ice cream shop to spend $5 and get his favorite combination of flavors. He then spends the remaining money in the following ways:
- Saves $20 in his piggy bank
- Uses $30 to buy gas for his car
- Goes out to the movies to watch the new release of his favorite cartoon for $35
- Donates $10 to his struggling friend, Drew, who needs a new pair of shoes
At the end of the day, Rob looks back at a day where he has satisfied his pleasures, taken care of a friend in need, and has not fallen behind in his obligations.
Sue, on the other hand, has $1,000, which is a lot more money than Rob has. She spends it buying a stylish bag for $1,000. It is a bit expensive, but her friend Jess has a similar bag, and Sue wants to look as cool as her. Once the bag arrives in the mail, she opens the box and realizes that the color is not exactly how she imagined. Bitter, she spends the next day trying to get her purse reimbursed and returned to the seller.
The point of this story is to illustrate that the art of spending money is just as important as the art of accumulating money. If you don’t know how to trade your money for full enjoyment, then why accumulate more?
So, let’s start there. Ask yourself: What do you feel has been the best use of your money in the past?
Whether it’s pursuing a passion, donating to an honorable cause, or helping a loved one in need, there is one common trait to money satisfaction: giving.