What’s Important About Money to You?

Have you ever been given a raise, received an inheritance, or maybe paid off a major debt?  When you found yourself with extra money at your disposal, how did it feel? Probably pretty good. As more time passed and you got used to this extra money or even started to take it for granted, maybe you’ve thought to yourself, “I’m not any happier now than I was with less money.”

Money itself can obviously not make you happy, but having more of it can certainly make it easier to do the things that DO make you happy. Whether it’s going on a trip, taking more time off work, or visiting with friends and relatives, money can help you do more of any of those things. Why then is it so common for people to come into extra money and not see an increase in happiness?

When we find ourselves with extra money whether temporary or permanent, we tend to ratchet up the number of good things we buy. More good toys, more good restaurants, more good family outings. However, buying something good hardly ever appeals to a person’s core values. In short, we spend the extra money on things that we think will make us happy, but don’t really matter to us. We spend on what we think is good, when we really want something great.

Why don’t people spend money on what they really want? The most obvious reason is that they are out of sync with their values. That is, people don’t actually know what they really want. I touched on this topic in a post last year, but I wanted to come back to it with a slightly different approach.

Using a Values Staircase

An easy way to find out what really matters to you is to ask yourself by using a values staircase. A values staircase takes you through a series of steps by repeating a simple question until you’ve reached the top of your values staircase. Use a pencil and paper to follow this example-

Stair One

Question : What’s important about money to you?

Sample Answer: Respond with your first thought. There are no wrong answers, but for many people, the answer to this first question might be a simple desire like, “I want to buy a bigger house” or “I want to be wealthy.”

Stair Two (follow up your first answer with the same question)

Question: What’s important about being wealthy to you?

Sample Answer: Again, no wrong answers. Just say what comes to mind first. Maybe an answer to this question would be, “I’d like to have more freedom”

Stair Three

Question : What’s important about freedom to you?

At this point you’ll be getting  a little bit more into what your real values are, what actually matters.

Sample Answer:  “I want to spend quality time with family and friends.”

Stair Four

Question: What’s important about quality time to you?

Sample Answer: “I want to make a difference in other people’s lives.”

Stair Five….

Getting to the Top of the Values Staircase

Continue this process until you feel like you’ve reached the pinnacle. Most people will go through 7-9 steps in this process, but it could be more or less for you. Regardless of the number of individual steps, there are typically three levels that the answers to your questions will take you through.

Sample Values Staircase

Level 1: Easy answers usually about simple or more materialistic desires.

Level 2: Thoughts about your relationship with others and how you might impact them.

Level 3: This level will help you delve into your inner emotions. This would be where you start to consider things like fulfilling your life’s purpose, living your destiny, personal enlightenment, inner peace and spiritual fulfillment.

Aligning Your Finances With Your Values

So often we let other people or circumstance dictate what we do, where we go, or what we buy. It could be family, friends or even a simple ad that pull us away from living a life in alignment with our core values. In the book “Essentialism: The Disciplined Pursuit of Less,” Greg McKeon suggests scoring decisions before you make them on a scale of 0- 100. For example, you’re invited to a party. Give the decision to go to the party a score based on how important you think it is for you to attend. If you give it a score of less than 90, you probably shouldn’t go.

Now that you’ve zeroed in on your values, you can use this same technique to help you decide if something is important enough for you to spend your money on.

“It has to be exquisite to be good. If it’s any less, you might as well skip it.” – Christoph Waltz