Question: Is your spending aligned with your values? I’m asking this because I recently realized that my finances and current spending patterns did not reflect my deepest values at all – unless my deepest values are eating sushi and pretty woven baskets! The reality of my spending came as a quite a shock, especially since I think of myself as a pretty self-aware and intentional person, so I decided to create a plan to be more intentional with my finances. See below for my tips on how to create a values-based spending plan.
Clarify Your Core Values
A value is defined as a strongly held belief about what is valuable and important. Take some time to reflect on what you deeply care about. Jot down any words that resonate with you (i.e community, philanthropy, creativity) and then narrow it down to your top 3-5 values. If you’re stuck, here is a great list to refer to for inspiration.
Now that you have defined your core values, ask yourself if you are honoring those values with your spending. If not, look carefully at where you are spending your money. Most of us fritter away a good percentage of money on things like lattes, snacks, and impulsive shopping. When I looked at my spending I was shocked to realize how much I spent on dining out and how little I devoted to things I deeply care about like creative workshops and travel. So, look at your values list and examine your budget thoughtfully. Where do you want to invest more of your money? What areas can you scale back on?
Get Intentional About Your Spending
Make a realistic budget which includes your monthly fixed expenses – i.e rent or mortgage, utilities and groceries. Mint is an excellent free resource for helping you account for everything if you need help. Subtract your fixed expenses from your monthly income and you’ll have a realistic sense of what is left to play with. This money should go towards your current core values, priorities and goals. Goals could include paying off debt, buying a new car, traveling more or philanthropic giving. Whatever it is, put it in your budget and spend with intention!
Keep Yourself Accountable
You know how when people want to get more intentional about their eating they start a food journal? Why not start a spending journal? Writing down every time you spend money will make you much more conscious about your financial habits and will help you honor your values-based budget goals. If you have a big goal like a trip around the world or a new home, try setting aside a fixed amount each month in a separate account so you can be proactive about making your most important goals a reality.