When you have a positive money perspective you don’t view money as a “necessary evil” or as the ultimate goal to attain above all others. Instead, you align your finances with your lifestyle, your goals, and the things you truly value. Obviously, those things vary greatly from person to person. Hence, gaining a positive money perspective doesn’t require us to do things in just the same ways our friends and coworkers might, but rather, to look into how our habits and choices either work for us and align with our goals and values, or work against us, and therefore, prevent us from attaining fulfillment in our lives.
So, whether you’re a CEO pulling in some serious dough, or a recent college grad who’s just getting your financial bearings, here are a few suggestions you can consider to make sure your relationship to money is a good one.
1. Prioritize Needs First
While this may seem an obvious suggestion, the truth is that many of us don’t adequately assess our needs so that we can make them a priority. Knowing what it costs to pay rent or the mortgage, keep the lights and heat on, and pay all your various monthly necessities like food, your phone bill, internet, and car payment is essential.
If you haven’t already done so, create a budget that shows you how much you need to allot each month for the basics. If your expenses seem to be running high, look into dropping down to a more affordable phone plan or spending less each week on groceries. Shop various internet providers or look into switching car insurance providers and see if you can get a substantially better rate.
2. Prioritize Paying Off Debt
Second to needs comes paying off debt. It’s easy to just pay the minimum on one’s credit cards. Doing so can definitely feel manageable. After all, that monthly payment of $30-50 is hardly puts a damper on your style but bear in mind the way credit cards work. Compounding interest is a doozy. Pay just the minimum every month and by the time that balance is paid off you could have spent hundreds, if not thousands, in interest.
Use a credit card calculator to help you figure out how much you can realistically pay every month in order to have those credit cards paid off by a certain date.
3. Set Small Goals
Big goals are great but they can seem daunting or abstract for some of us. In service of reaching those big goals, why not set smaller financial goals that can be achieved rather quickly? You can track your progress along the way and even setup rewards for yourself once those goals are attained. For example, you could set a goal of saving $1000 in two months. Achieve that goal and, as your reward, you get to splurge on a $100 haircut or a pair of concert tickets to an upcoming show.
4. Set Big Goals & Build a Positive Money Perspective
As you work and earn money during your lifetime, it’s essential that you put your money towards achieving any and all of your big goals. If, for example, you’d like to buy a house, you should be actively putting money away towards making that goal a reality. Even if you can only afford to put away a little at a time, the mere act of saving those dollars to meet a specific goal can work to positively reaffirm your goal.
When we get into the habit of saving with specific goals in mind we build financial confidence and the integrity that comes from aligning our words and actions. This can be downright transformative. If you find you have trouble saving money for goals which seem too grand or daunting, set your sights on achieving smaller goals (as explained above). Once you’ve reached the goal of saving $50, $100, $500, or $1000, you can put that money towards achieving the bigger goal of buying that home, starting that business, or expanding the size of your workshop.
5. Create a Financial Vision Board
Sure it might sound slightly hokey to some but making a financial vision board can be a powerful tool when it comes to achieving a positive money perspective. Flip through old magazines, find powerful images that show you exactly what you’re hoping to achieve financially. This visual reminder can be a powerful tool at helping you stay motivated to make those goals a reality.
6. Consider the Opportunity Cost
Are you considering going in big on that trip to the Caribbean with the gang or are you finding yourself dreaming about the new Tesla? Consider the opportunity costs of your choices. How much further along would you be saving towards your home if you forgo the trip? How much more will you be able to save without the payments you’ll incur by buying a new, expensive car? For everything new, shiny, and exciting you stand to get, really think about what you’ll have to give up in exchange and ask yourself, “Is it worth it?”
7. Reaffirm that Money Isn’t Everything
We all know money isn’t everything. Nevertheless, some of us can get caught up with having to earn money, make money, and save money. But there’s more to life. Take time to do things that give you joy for little to no money. A long walk with a friend or loved one, watching the sunset, enjoying a long conversation or doing something creative like drawing, painting, or singing can help us retain a sense of balance and appreciation for all the things that make life feel rich with nary a price tag.
8. Practice the Walk-Away Response
Impulse buying is real. If you find yourself wanting to spend on goods you haven’t already decided you want or need, it’s probably an impulse buy. Rather than going to the checkout line, head for the door, or remove yourself from the area. If you find you’re still thinking about the product, consider whether it will really work to suit your needs. If it’s an article of clothing, will it work with your current wardrobe, is it something you will actually wear and get value out of? Is the price tag reflective of the work that went into making it? Is its expensive price tag part of its appeal? Or, is a low price tag making you feel like you’re getting a deal on something you don’t really need?
Shifting to a more positive money perspective doesn’t happen overnight for most of us. Some of our existing money habits may be good, others not so good. Awareness is the first step. When we look into the habits we’ve developed and the core beliefs we have about money, change becomes possible. By starting with our values and goals and using money as a tool to achieve those goals, we can build a life that feels truly rich.