Today, a little exercise to make you think about whether your spending on things that you value.
First, I want you to take a piece of paper or a napkin or the back of an envelope, and I want you to write down the top 6 or 8ish things that are important to you. We’re not ranking them, so don’t number them or think that way. For me, the list includes (in no particular order):
- my marriage,
- my kids,
- my extended family,
- security, and
- helping others.
Then, I want you to look at how you spent your money in the last month. You can use your memory, go through your bank account, check your credit card statements…however you spend money, take a look. Try to match up your spending to items on the list. For me, food and rent fall under security. Charitable contributions fall under helping others.
Then, look at the items that don’t seem to have categories, and do some thinking. Some spending might still be important, even if it doesn’t line up with your values. However, you may well find a bunch of spending that doesn’t really fit in with the things that you state are important to you, and don’t have some other sort of value. Some items are tricky, like clothes. One level of spending on clothes might fall under security, but another level of spending on clothes might not be in line with what you feel.
This isn’t an exact science, and there aren’t any rules. It’s more about looking at your spending consciously and seeing where you are spending that doesn’t line up with the things that are important to you, and where you could spend more on the areas that ARE important to you. Spending that is in line with your values provides more satisfaction, and ares that aren’t valuable to you are a great place to slash expenses.