Where you spend your time and money is a reflection of what you value the most but sometimes our spending can go off course by other influences in our life, like spending money on things that we think make us happy but are of no real importance to us.
This may be because of a partner not being on the same page as you financially or you may have ignored investing in the things that make you happy which has forced you to get into a rut with your budget. Going from two incomes to one can be a challenge too, it’s hard to spend money on your goals when all you can do right now is survive on the bare minimum.
We all have different morals, passions, situations, incomes and lives. It all comes down to what gives your life purpose and what you don’t mind paying for from your budget. Only you can take responsibility for allocating your income to cater for not only your needs but also the happiness you deserve within your goals. No two budgets will be the same so they need to be designed to reflect your values.
Some things are important to us and others not so much…
We don’t mind trading our time and money for things that mean the most to us as they make us happy and give our life purpose. Value based budgets are going to bring happiness and contentment by allowing you to allocate money to do the things that make you happy.
-Spend too much time working to make money for things not valued?
-Have kids because you wanted to, but don’t want to provide everything needed towards their upbringing?
-Own pets but don’t mind having extra costs to cover food, care and any damages?
-Justify paying more in electricity usage to have luxuries like air-conditioning and clothes dryer usage?
-Buy and consume alcohol to cope with the pressures of life?
-Have a minimalist mind set because you don’t value ‘things’ hanging around?
These are just some basic value examples above and everyone will view these statements differently. Any way you look at these and other things, determines the way you should operate your finances.
TIME IS PRECIOUS. When you budget your money, you need to take time into consideration too. After all, you’re giving up your time to spend it earning money to pay for everything that brings you joy and value. Find out if your time is best spent earning more money or by doing the things you'd rather be doing in an affordable way.
MONEY IS A RESOURCE. How many times have you wanted to spend money on something you value (like a holiday for example) but think you’re unable to because you have to spend any spare money on other things that aren’t as important to you? See where you can change this to start using your money resource to fit your life.
WHAT DO YOU VALUE?
It’s possible for your money to give you more value. Just by doing a simple exercise you can learn a lot about yourself, your spending habits and about the things you value the most to bring your spending back in line with your values.
Write a list of all of your expenses, both repeating expenses and other expenses paid monthly, quarterly and yearly, everything! Then write another list of everything you place value on with your most important being first. Make sure your list reflects the things that bring meaning, happiness and value to your life.
Do both of these lists match up with both spending and expenses reflecting your values? Or is there a complete difference and your spending is way out of line from your values? What do these lists tell you and what can you learn from what they tell you?
Are you spending on things of value or are you letting other purchases get in the way? If you’re spending is out of line with your values you won’t be feeling fulfilled or happiness in your life when you’ve been wasting your time and money on unimportant things.
If this is you and you’d like to enjoy life and aim for some goals, you can! Just by getting back in touch with you, to rediscover your values and start value based spending. It will change your life.
HOW DO YOU VALUE OR VIEW SOME OF THESE?
By looking at some of these areas you can change your spending habits to reflect your values. Can any of these be added to your budget to give you more value? Can you lower some costs in other areas that don’t bring happiness to cover the things that do?
First look at your basic needs; housing, food, transport and other expenses etc then look at your extras.
Start with the one you spend the most time on:
Most of us trade our most precious thing which is ‘time for money’. Money which is needed to provide for all things we value. Work towards where you will get the best value for your time. Work less for more time or work more for more money.
How many hours of your time do you need to give an employer to provide for all of your expenses? This is the first area to look at as how many hours you give depends on how much you need to cover your expenses. Do you value your money more than your time given? Could you cut back expenses to reduce the amount of hours you need to work? Or would you prefer to work less to spend your time better, spent doing what you value?
What you own, do and use time for is a direct reflection on your values. Get them back along with your drive and happiness.
Let’s look at some expenses as examples.
How do you value your housing? Apart from having a roof over your head, are you happy living in a small house with minimal furniture and items or does a large elaborate house to hold all of your possessions make you happy? What you’re happy to live in will determine it’s level of importance to you to find your value of housing.
How important is the car you drive? Do you like to be seen in the latest model or are you happy to spend less and drive an older car until it starts to cost more than the car itself? I recommend an older car on a low income, but if you bring in a high income, a newer car might give your life more value, and that’s ok as long as you can pay for it without neglecting other needs.
BILLS & EXPENSES
You may want to cut down these expenses because they don’t bring much value to your life. Some simply save you time and if that’s more important than saving money in these areas, that’s ok. Sometimes using services to free up your time to spend in other areas is more valuable to you than doing these jobs yourself. Weigh up where you don’t mind spending money and reduce or eliminate expenses you don’t agree with as being valuable to you.
If spending time with family and friends brings you great value, you might find yourself spending more time and money to be with them, having fun with activities and holidays together to create memories. Maybe you’d prefer to make solo memories and not start a family of your own because you know it’s not what you want to spend your time and money on. Which ever you value most, you can spend accordingly.
If you value owning pets over the cost of owning them, you should be prepared for this. Pets are like kids and cost a lot to look after. Even more if you let them create havoc and cause damage to your valued property. If costs and time spent with pets are a valued part of your life, this shows where your values lie and your expenses would include this.
SELF MAINTENANCE AND CLOTHES
Is self image up there on your important and valued list? If looking good makes you happy without depriving you of your needs, then by all means spend money here. If this doesn’t bring you value, use this in other areas on your valued items list.
EATING OUT & ENTERTAINMENT
If you love not having to cook and are able to cover the costs, add it to your budget and enjoy it if it makes you happy. If you value your money spent elsewhere, allocate it to other things instead. You might choose to not eat out very often (or at all) to instead spend it on concert tickets and other entertainment. What ever you value the most, is where you should spend or spoil yourself.
If you value adventure every spare weekend; boating, motorbike riding or sports as they bring your life value, you will make this a priority in your budget to allow you to do what you love. If you’re a part of a couple, be careful not to be selfish and involve your partner or both have your own spending for separate hobbies and fun.
PAYING OFF DEBT
Have you noticed that paying off debt gives you no value? Unless of course it's good debt that will eventually bring you more money, to work less. Paying off debt may be the most important thing to you right now, in order to free up some money to then be able to use it in a more productive way. Eliminate this expense and your life will instantly be happier.
Perhaps this is the most important to you? By saving money, it can allow you to do more of the things you love. Having multiple savings can supply different areas of your life to provide for more than one thing, like having your cake and eating it too. Start a savings fund for a specific thing that brings you value if this is the way you need to be able to get more out of life.
With us all having different views, likes, opinions and incomes, we can find what matters most to us and allow for these expenses if we want a happy and fulfilling life. If we don’t do what makes us happy with the dispensable money we have, we would be living a miserable life. Distribute your income where it NEEDS to be first and then where it will bring you the most value.
Look at every aspect of your life that reflects your values and spend your money on the things that are of the most importance. Don’t forget to think ahead and incorporate the future into your life and budget. Whether you’re a new home leaver, in your 20’s and 30’s, moving forward in mid life or heading into retirement, plan and spend accordingly for you and those you share your life with.
Over the years I have aligned my spending with my values. This isn't very hard when you're living on minimal income and trying to stretch every dollar. I've eliminated all wasted spending and have my budget to a point where I only pay for things I either value or can justify spending money on.
Some things save me time, some save me money and some provide fun times.
I have learned a lot about myself over these years. I now know that I value experiences, family and learning the most (rather than possessions) therefore I spend my time and money on these instead of wasting them on things I don't get satisfaction from. I follow a value based budget to reflect my values:
* I never buy anything unless my family and I will get some value from. I definitely don't enjoy giving away money for items I won't keep. I just can't justify spending on things I don't want to spend time or money on.
* I don't need a fancier house, the one I built 14 years ago is still fine. I would prefer to continue to chip away at my lower mortgage. It's a roof over our head and an investment for the future, nothing more.
* I don't place much value on eating out... Why would I like spending money on something that gives me nothing in return except for not having to cook when I can make something with the food we already have at home? Not worth it for me.
* I can't see the value in constantly updating my wardrobe, only a few items each year at the most. I'd rather buy some select quality essential items that will last me 10+ years. Looking beautiful does not bring me much value.
* Updating my car is of no value to me. They are THE single worst item to spend money on, depreciating too fast. I just wouldn't enjoy spending $20,000 on a car when I can own and drive one for half of this price. I need a car to last for years so I'm not constantly paying one off. I could use that money elsewhere.
* I don't mind spending a little extra on our electricity bill to allow us to use the clothes dryer daily. This gives me value as I have more time to spend with my family instead of all that hanging up and remembering to bring it in when dry.
* I'm aware that I spend up to $1,000 each year on coffee. This is ok with me and I can justify spending this as I enjoy buying a few coffees each week while working.
* I allocate money in my budget for holidays and concerts. These are my 2 favourite things to do and I make sure I'm always saving for the next experience. This brings fun, adventure and memories... value in my life.
* I value purchases that I can make money from. I think creating your own income is important. I want to work less and be able to enjoy more of my life and family instead of wasting time by working too hard. Time is precious to me.
These are only a few things that come to mind for my value spending and I'm sure I could write a lot more.
Think about where you spend your money. Just by thinking before you spend, setting goals and working towards those goals, you'll start to see where your values are.