Be Principled With Your Money For Outrageous Financial Success - Smart Money Seed

7/3/18

Be Principled With Your Money For Outrageous Financial Success



A popular piece of personal finance advice is the simple yet powerful phrase spend on what you value. Well, I value a whole lot of stuff. I value Starbucks coffee, going to sporting events, eating out (read: not cooking), new clothes, drinking beer, investing in myself, and even being charitable every now and again. And I'm betting most of you value many of those things and more as well.

So maybe spending on what you value isn't exactly a magical key to financial success. Maybe we need to dig a little deeper. 

How about spend on what you value most? So I'm supposed to go to every Ohio State football game all year and never buy Starbucks or buy a new shirt again? That doesn't quite work either.

The key to taking steps toward financial success goes a little deeper:

Prepare to be principled in your financial decision making and management.

In essence, you need to think first about what you value. Then you need to analyze your financial situation and set short and long term goals. Once you know how much you need to earn and save, you can determine how much you can spend on the extras that you do value. But that spending has to be done from a matter of principle.

Our Principles Drive Our Decisions and Actions

Let's walk through a real example of this related to fitness in my life.

I've never really had much principle driving my health and fitness decisions and actions. I was in pretty decent shape during high school, but that was because I played sports all year. Sports' exit from and beer's entrance into my life has not exactly been the healthiest equation for me.

Even when I was in good shape, I wouldn't make healthy choices out of principle. My brother Max, on the other hand, was always more apt to make a healthy choice. During my high school years, I spent a lot of time outside of practice playing video games. During his 3 years later, he spent a lot of his time in the weight room.

When we needed a snack, I was reaching for the potato chips while he would grab a piece of fruit or maybe splurge on some pretzels. Even during college when we would drink together he would have a Miller Lite while I guzzled a Fat Tire.

The driving factor behind Max's decisions was his principle. He valued his health and fitness, so he planned ahead and lived by principle which drove his decisions and actions. Going to the weight room or passing on the fried chicken wasn't really any easier for Max, but he knew those decisions would support the overall healthy life he wanted for himself. 

I've begun building principle into my health and fitness which is certainly a process.

  • I look at my calendar on Sunday night to figure out how many times I might eat out during the upcoming week and plan the meals I'll eat at home accordingly (more eating out = healthier meals at home).
  • I also like to read menus before I go out to eat so I can find something healthier to eat rather than sticking with my impulse go-to buffalo chicken sandwich.
  • I lay my workout clothes beside my bed so I'm more prepared to decide to get up and go to the gym. 
  • I joined a TRX workout class style gym to build accountability into my workout schedule.
Not the highest quality photos but here are a couple examples of my healthier meals I've been making:

Vegetarian sweet potato, avocado tacos!
Buddha bowl with Chicken, brown rice, broccoli, cauliflower, carrots, and thai peanut sauce!

As I repeat these actions over and over, they become repeatable habits which then train my brain to treat them as matters of principle. Instead of looking for the food that will taste the best, my brain begins to look for the food that feels the best. Don't get me wrong, I still definitely notice the tasty food. But my principle tells me to value the healthy feeling over the tasty food.

Let's Get Back to Money

The most important way to make positive money management decisions on a repeatable basis is to wire them in your brain as principle. 

I wanted to buy some navy pants for several months which I knew would bring me a lot of value because Amanda would stop nagging me to get new pants and stop wearing my current pants which she endearingly refers to as the color chocolate milk. I shopped around for a while, found the pants I wanted that brought the most perceived value for the money, and purchased them on Black Friday for over 50% off.

I also wanted a new mattress and the new Call of Duty, but even though I value a good night's sleep and playing video games, my principle told me that I didn't exactly need those things right now, so I should save the money instead.

I'm not perfectly disciplined in my money management, and my occasional splurging actually helps me regain my focus and motivation in my money management system.

The key is to take some time to reflect on your needs, wants, values, and income and to create a principled money management system that will encourage you to make positive financial decisions. Once you have that down, financial success will become second nature!


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