The primary step to getting smart concerning money is to better comprehend how you feel about it. Understanding your Life Values — the Inner, Financial, Physical, and Social drivers that affect your financial decisions — can help make clear your objectives and priorities.
Have you ever questioned why you feel fine about spending money on holidays, but shun saving for retirement? Or why you pay money for new golf clubs but put off when it comes to giving your kids an allowance? The answer may possibly be in your unique Life Values and how they manipulate your financial decision making.
The majority of us don’t understand what’s behind the numerous financial decisions we make yearly or even daily. Also, when we are in a relationship, we are even less sure why our partners make the decisions they make.
The decisions you make each day are only partly based on facts and judgment. For instance, rationally, you are aware that healthy foods are better for your body than junk food. Nevertheless, with that knowledge, and even when you plan to eat well, you might still find yourself choosing a doughnut instead of an apple.
Why? For the simple reason that your other part of decision making is swayed by inner drivers that you probably are not even conscious of. Everybody develops concepts of their wants, needs, and “shoulds” early in childhood and these concepts change all through life depending on your experiences.
Regardless of your rational voice telling you to eat the apple, your inner drives might seek for comfort, or even revolt, by eating the doughnut instead.
These wants, needs, and should develop into the values that influence all of your decisions. They come from numerous sources, including:
• Parents, siblings, guardians and other family members
• Friends and peers
• Teachers, mentors, and coaches.
• Groups, you associate with (religious organizations, teams, clubs.)
• Authorities and organizations (police, community groups, service agencies)
• The media (social media, news, TV, movies, music, magazines, advertisements)
Hidden Messages
In regards to money management, children gain knowledge through direct lessons from their parents and teachers, however, they also learn by observation. They observe how their parents and guardians handle money; they notice how their friends and families use money; and they receive messages from movies, TV, advertisements and several other sources.
Some messages are very direct. For instance, if parents have a rule against cell phones while eating and everyone respects the rule, the message is plain. In contrast, if parents rule against cell phones while eating, but they don't adhere to the rule themselves, this sends a confusing message.
Hidden or mixed messages regarding money in childhood can revolve into adult habits. If you were told to save money, but your experiences in your childhood convinced you that it's impossible to save because you’re just “not a saver,” or perhaps spending money when growing up was a way for you to rebel, or a means to find comfort. Now, as an adult, you might disrupt your own savings because you are acting out an unconscious belief you got accustomed to in childhood.
Changing the Message
Each time you make a decision, you unconsciously tap into your values seeking for the choice that will move you away from disappointment, fear or distress and toward peace of mind and satisfaction. With every decision, you seek out the option that will make you most comfortable. Whether you realize it or not, you oftentimes choose the options that are not best for you because they are easier and are less stressful at that moment.
Already you are aware of what happens whenever you do things the normal ways you’ve always done them. Regardless of your goal - to stop a bad habit or to start a healthy one, the solution lies in making decisions different from what you normally do.
So, even if your rational mind says “Don’t eat the doughnut,” your inner desire to feel comforted might override what choice you know is best for you. When you realize that the voice in your head telling you to eat the doughnut is actually crying out for a feeling of relief and comfort, then you can look for other ways to give yourself what you actually want, rather than going into autopilot. Even if you still eat the doughnut, you will know why.
Beliefs About Money
The social rules about money in today's culture can be puzzling. On one hand, we are told to be accountable with money. If you appear to be reckless with money, you might feel fear, stress, and a deep feeling of shame as an end result.
Feeling careless, stupid, or ignorant about money can hurt people, and this feeling can be passed on from parents to their kids, creating a sequence of harmful money habits in a family.
Conversely, there also is a lot of pressure to buy things. Just consider all the ads you see in a typical day persuading you to spend money.
It is difficult but possible to balance these two social pressures - financial accountability and consumer spending. To do this, you need to understand the hidden drivers behind your decisions. Taking control of your financial life starts with a better understanding of yourself.
Follow me and watch out for a follow-up article where I will explain the Life Values — the Inner, Financial, Physical, and Social drivers that affect your financial decisions .