How to Find Your Money ‘Why’

1. Tap into your core values.

What’s most important to you? Unlike with the next two exercises, you’re allowed to be a bit vague here. You might find yourself naming things like “beauty,” “health,” “community,” “family” or even something grander like “justice.” Faced with spending decisions, you might ask yourself whether a purchase supports your core values. Now, sometimes the answer is an obvious “no.” This new lip-gloss/headset/hamburger does not contribute to social justice. But, sometimes advertisers will attempt to target your core values in sneaky ways. For example, a fuel-efficient car seems like a truly environmental choice; however, it’s not as environmental as simply not buying something.

In her book Loaded, behavioral economist Sarah Newcomb writes about these values in terms of “needs” and explains that the infamous “latte factor” can in fact be scratching the need for “social connection.” If you enjoy visiting your local coffee shop. If this is the case, then simply saying, “I’m cutting the coffee” isn’t going to work, because the latte was never just about the caffeine hit to begin with; it was about the bond with the other regulars at the coffee shop. As you spend time reflecting on your values, start listing low-cost and free ways of sustaining them. For example, if you feel advertisements for green juice are exploiting your value of “good health,” turn to your list of other habits and consider a vigorous workout or make a water-drinking chart for yourself in your notebook. You may still get the “hit” of supporting what you value without the hit to your wallet.
2. Do the priority exercise.

Prioritization can be a painful practice because it involves choosing one option above all others. Not wanting to make such choices can be part of how we end up in consumer debt. The good news about priorities, though, is that they can be seasonal. Too often, companies make us feel like we have to choose everything at once, but choosing to spend in one area now needn’t mean we can never spend another way.

Take a moment to list your financial priorities: remodeling the house, saving up an emergency fund, freeing yourself from credit card debt, building a college fund. Don’t list too many. Now, among these, which is the most important for this season of your life? You’re not committing forever and ever, just choosing a point of focus for a time. Making this choice should be active, and you might practice writing the choice out or saying it aloud in this way: “Right now, I am prioritizing my emergency fund.” Making this active declaration might help stave off feelings of deprivation that come from the vaguer and more negative, “I can’t buy x because I’m on a budget.”
3. Choose your identity.

It’s a bit grim, but take a moment to picture your obituary. Or, if that’s too much, imagine the speech a colleague might give upon your retirement. What are the key highlights of your life? What do people remember and admire best about you? Maybe over your lifetime you were an intrepid traveler. Maybe you were a father who created wonderful opportunities for his children to express themselves creatively. Maybe you created a groundbreaking language-learning program. Maybe you brought joy to your community by developing a series of urban gardens based on experiments from your own backyard.

Spend some time thinking through the identities you’d want people to describe you by at the end of your lifetime. Put your favorite one or two on an index card or sticky note and put it some place visible like your bathroom mirror or your wallet. When you are faced with decisions about spending, use these identities—bold painter, curious wanderer, community leader—to ask whether the expense is helping you move closer to the person you want to be. Doing this may also help clarify savings goals, such as taking art classes, saving for trips, remodeling the backyard, and so on.

There are millions of things to spend your money on, and advertisers are happy to supply you with reasons for purchasing any number of them. Having a money “why” clarifies decision-making around money both in a day-to-day way and in moments when you’re faced with a big decision, whether that’s a happy one such as a windfall or something darker like a job loss. In moments big and small, decide what action would be most in alignment with your money “why.”


SOURCE:success.com