We all want to live lives that speak to our personal values. To do this we must also set goals that support our values.
Often traditional financial planning is “goals based” and focuses upon achieving specific monetary objectives. This can even be as basic as an advisor providing a client with a preset goals list and asking “which of these apply to you?” Clearly this practice does not delve into the values and principles that underlie the client’s goals.
When people establish goals without first exploring their personal values they may find that their goals do not truly speak to them as individuals or enhance their lives. Instead, the goals are based upon societal expectations.
I believe that to truly live authentic lives that feel good and fuel us, we need to begin by uncovering our values. Digger deeper to identify your values and determine your principles allows you to set meaningful goals that support those ideals. Without that introspection it is easy to fall back upon common societal objectives. Working toward externally created goals will decrease our motivation and make it much harder to follow a financial plan.
You will be happier if you are working towards personally meaningful goals. If your goals do not resonate then your motivation will lag and your personal satisfaction will suffer. Even achieving these goals may feel hollow and inauthentic.
For example, financial planners often advise people to save money in an emergency fund for a “rainy day.” This can be challenging because you are asking yourself to give up current pleasures just in case you need the money for some vague, hypothetical expense. Instead, consider what is really important to you. Let’s say you value space and beauty and a goal is to always maintain a warm and comfortable home. Having an emergency fund may be the difference between keeping your home during a personal financial crisis and needing to relocate. You may be more willing to forego the new phone or dining out (assuming these expenses do not closely align with your values) if you know that you are reducing your spending to protect your home, which is your highest priority.
Before setting your financial goals, take some time to identify your personal values. Once you have identified these values you can set goals that support these significant areas.
Having personalized goals that align with your values, rather than generalized societal goals, may help you stay on track with your spending and follow your financial plan. Following the plan will help you to achieve your goals. Achieving your goals allows you to live your values. Living your values brings joy and contentment. So, if you are having trouble following your financial plan let’s reverse engineer the planning and start with the values.
Maura Madden is a registered investment adviser in the State of Washington. The Adviser may not transact business in states where it is not appropriately registered, excluded or exempted from registration. Individualized responses to persons that involve either the effecting of transaction in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption.