Why is it important to know what your values are especially when making decisions about money?

March 5, 2020 - 3 minutes read

Posted by Claire Parker

Values

“the principles that help you to decide what is right and wrong, and how to act in various situations”

You will often hear a company talk about their “core values”.  

Here are some examples:

• American Express “Customer Committment”
• KPMG – “We lead by example”
• Ikea – “Daring to be different”
• Netflix – “Courage”.

When you employ a business consultant, one of the first things they ask you is to define your core values – we have done this process at Xentum.

Yet when we sit down with a family to discuss their financial plan and we ask them to define their family core values, we often get a blank stare to start with.  

At Xentum we believe that your family finances should be run in a similar way to a professional company (core values, balance sheet, cash flow forecast, 5 year plan, regular updates etc).  

This is why we put Values at the very core of our WealthPlan™  process.   

Why do we ask about Values at Xentum?

When it comes to finances and money, our future is often defined by decision making whether we like it or not.  

We generally become the decisions we have made either large or small on a consistent basis.

Decision making can be a new habit that we decide to implement each day or a big decision such as selling your business or changing your employment.  

The problem with decision making is that it is very hard!  

Knowing when to take an offer for your business or hand your notice in is often an impossible decision to make for most. 

We believe that decision making becomes easier once you align those decisions with your values. 

Examples of Aligned Values

A personal example  

One of my values is “time with my family. “

One of the decisions I made is to prioritise my children’s school run in my working week.  

When I align my value with my decision making over whether to take a meeting at 9am then my decision becomes simple.  As I type this I am getting ready to drop my daughter at school and have my first meeting at 10am.  

A client example 

One of our families had a value of “flexibility” linked to having more time to spend with their family whilst their children were younger. 

When we demonstrated that they could spend time off from their busy working lives to take a bucket list trip and also a large career change from corporate into private world this made the decision fairly easy.  

One small decision and one huge decision both made on the basis of values based financial planning.

This is what aligned values look like.  

Being honest with values

When we talk about values with clients and families we talk about honesty as it is fairly easy to spot when values and decisions are not aligned.  We are not here to judge, just advise on what we believe is best for that family.

For some also, they have not even considered their values and this can take some time.  

We often get bogged down in the details of goals (which we will cover in a separate blog) and solutions rather than looking at the bigger picture of what we really value.  

It can really benefit to spend some time thinking about these values and writing them down.  You will be amazed how clear your thinking can become. 

Here are some examples of common values amongst the families we look after:

Health

Happiness

Convenience

Travel

Intellectual Work

Giving

Education

Legacy

Wellbeing

Relationships

Security

Progress

The key is to make sure that your decisions particularly around money are lined up to your values!

‘When your values are clear to you, making decisions becomes easier.’  Roy E. Disney

When I meet with a new client for the first time, I feel it is important to spend the time to get to know them.  From a financial perspective of course, but even more importantly, from a life perspective.  I need to understand what makes them tick, what excites them about their life and their future. What is REALLY IMPORTANT to them! Once I know this about someone, I feel that I am now in a position to give them sound financial planning and investment advice.  

So what is REALLY important to you in your life? If you are writing your life story, what areas of significance and meaning will become your identity as the main character of your story?  What core values will drive the decisions you make in life.  No matter what is going on in life, our actions are constantly conveying a message about what is important in life to us to others and ultimately to ourselves. 

Every one of us wants to live a life that is important, to make a difference, and to be remembered as a great contributor to society.  But what does that mean for you, have you ever taken the time to slow down long enough to pray and reflect about it? What does that story look like for you?  What would it take for your life story to be one of meaning and significance?

That doesn't mean you have to be rich, famous, successful, have a large home or drive an expensive car.  It is exactly the opposite; it means, what did you do with what you have been given, whether large or small. Stop right now and think about it for a minute.  Who cares about your car, your home, your position, your wealth...YOU!  You are the only one who cares.  But, what if you could do something with what you have, whether it is much or little, to make a difference in the lives of others?

Early in our marriage, we didn’t have much.  But we had two small children and a modest home we were building a life.  We weren’t able to save much money but we had enough to live a fairly comfortable lifestyle.  In our small group meeting one week a couple asked for prayer about their financial struggles and how hard it was to keep up with their bills.  They didn’t give specifics; they only shared that they were in need of prayer.  That night my wife and I felt that we wanted to help, but we didn’t have much.  We came up with a number, and it was a whopping $250.  The next week, we gave them the money in an envelope, and they were very appreciative.  We felt good that we could help and hoped that we made a difference.  

Then, about two weeks later, the wife came to us and told us how grateful she was that we had given them the exact amount of money they needed to keep their car from being repossessed.  It was a small amount for most of us but made a big difference to them. Even though we didn’t have a lot of money to help them, we gave what we could, and it was a real blessing to them. It really did make a difference in their life.

I bring this up not to toot our own horn because $250 was not a lot of money or a huge sacrifice on our part.  But I bring it up because to put significance in our lives we have to be willing to take action.  No matter how small or insignificant we feel, it is, if we do nothing, we change nothing.  If we allow our fears and concerns to keep us from starting or waiting for the ideal time, like when we have enough to give, it may never happen.

So, if what we do, the actions we take and the decisions we make, make up our life story and show others what is important to us, what actions will we take each day that will show God and others what is important to us in life.

It may take time and some practice, but I give you this promise; as you start making decisions based on your true core values, you will feel truly happy, your heart will sing and you will feel satisfaction in your soul, unparalleled to anything material possessions can bring.

The same holds true for your financial planning decisions.  As you learn what is really important to you in life, it will become much easier to make financial decisions that align with the vision of your “Ideal Life”, and will bring you much more happiness and peace.

At Buckeye Wealth we combine our depth of investment knowledge, investment philosophy, and cutting-edge technology in order to empower fearless investing. We’ll take a quantitative approach to pinpointing your Risk Number by going through a series of objective exercises based on actual dollar amounts. Click the button below to find out your risk number.