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15 Jun 2016
Money can buy a lot — toys and technology, food and shelter, influence, oh-so-shiny luxuries and not-so-special necessities.
But money rarely buys you happiness. As The Notorious B.I.G. once said, Mo’ money, mo’ problems.
That’s why writing a Top five is so effective in helping us have a healthier and happier relationship with cash.
When you make the Top Five a part of your life, you make gratitude a part of your life. And gratitude is vital to ensuring that money matters don’t drive you mad. When you begin seeing the world from a grateful and positive point of view, you learn to be appreciative for what you have. You begin to notice the things in your life that make you happiest.
Money weaves itself into so much of our daily lives. It’s unavoidable. So whether you think cash is king or cash is trash, as members of a money-minded society, we have to respect the all-mighty dollar. It’s even better if you can get joy from it.
Let’s make that a reality, shall we?
When you think about money, how do you feel? Does your mind drift to visions of holiday travels or does it linger on your debt, bills or retirement savings? Does money bring you pleasure? Does it cause you anxiety?
Money can be a two-faced frenemy. It can provide, but it can also bring you panic-attack-inducing stress, strain and spite.
Though, I have to admit that these days I have a very good relationship with my finances. Especially since my recent minimising extravaganza, when I spend my disposable income I love it.
That’s mostly because I only spend money — except for bills/maintenance — on things that are useful, that are for my family or that bring me joy.
I have a very clear idea of where my money goes. I know how much comes in and goes out each month. I know what I can and can’t afford. This means I have a lot of positive energy around money.
I have a goal to pay off our home soon, and I really, really love going on adventure holidays each year. But I also have goals to be generous toward my family, to buy a random bunch of flowers for friends once a month and to invest in female small-business owners all over the world.
This attitude toward money didn’t happen overnight. It began with getting crystal clear awareness of my financial situation, setting goals and taking action.
The change also amplified when I took the time to understand what shaped my relationship with money. My parents never got in over their heads with finances. They didn’t have a credit card for many years and only bought what they could afford. My dad lost his father when he was young, so he and his other siblings worked hard to contribute financially to the family a lot younger than many. From this I learnt lessons about saving, not getting into debt with things like new cars and not spending more than I had. It took me a long time before getting a credit card. A home loan limits my feeling of freedom, but it also stokes my fire and determination to get it paid off as quickly as I can.
Another thread in my behaviour is a sense of optimism that it will all work out in the end. With this mindset, I was in cruise mode with money for a long time. As long as there were no red flags and I made my credit card and loan repayments on time, I assumed I was doing really well with my money. I was actually missing loads of opportunities to be more proactive with my cash. Now I am laser focused on my financial goals, but I am not money obsessed: My focus compliments my positive perspective in other parts of life.
So these days, rather than thinking, “Can I afford this?” or assuming I can afford things, I really value and enjoy my money. Yes, money is a ticket to experiences, but a lot of my money actions are also aligned to my values: making a difference, family, joy, health and productivity.
You can also have this kind of positive relationship with money, I promise. Just remember this: Knowledge + focus = power to take your own positive actions.
Does taking action seem overwhelming? Does your financial goals feel too massive to tackle at once?
A bunch of small steps
Add up to big leaps.
Especially when it comes to the Top Five, pint-size positive actions can end up making giant impacts in the long term. Money is no exception. In fact, it’s a prime example. When you slowly begin to change your attitude toward money and begin to take small, positive steps with your budgeting or spending, it can add up.
That doesn’t necessarily mean you’ll have more money. But you’ll have more joy.
People often assume that more money equates to more happiness. Sure, a bit more cash or credit could buy you stuff and experiences and maybe even make your life a little less strenuous. Especially for those living in poverty, more money would probably mean fewer sleepless nights and more stress-less days.
But money doesn’t usually buy you bliss.
In fact, personal financial issues are the biggest cause of stress for Australians. It’s practically an epidemic.
In one fascinating study, Michael Norton, author of Happy Money: The Science of happier Spending, finds that making more money doesn’t really improve your mood. In his research, hundreds of people were asked to rank their happiness on a 100-point scale. Then the subjects were asked to predict how happy they would be if they made different incomes, from $5,000 to $1,000,000. People earning $25,000 a year reported that their happiness would double if they were earning $55,000. However, people who made $55,000 reported being only 7 percent happier than those who made $25,000.
While you think having twice your income will make you twice as happy, Norton’s research shows, increased cash flow does not notably improve your happiness.
Norton also says that no matter how much money you make (again, unless you are living in poverty), you continue to buy the same things…just nicer versions of the same things. You may buy a more expensive bottle of wine, instead of a cleanskin bottle. Or you might buy a BMW hatchback, instead of a Toyota Corolla hatchback. Sure, your car has all the bells and whistles, but it doesn’t actually make you happier than if you owned the mid-priced car.
My favourite part of Norton’s research is this: Money can make you happier, but only when you spend it on other people or you give it to those in need. Or you spend it on experiences.
Stress can drive action. Your financial stress may drive you to work longer hours or take on extra projects or accept that job that means more responsibility. But along the way, it can cause a lot of us to spiral out of control, to burn out, to break down.
That’s why we must build awareness around our lives, including our money situation. It isn’t all investments and stocks and mutual funds. If money is something you have negative emotion around (fear, guilt, shame), then there is a lot of power in just knowing your financial situation.
It isn’t about having lots of money, it is about having lots of awareness
That’s where the Top Five gives you a brilliant return on your investment. Writing a Top Five is a process of building self-awareness. When you take the time to write down five positive things each day, you are opening up your life for examination. When you begin to look at your financial situation with a Top Five eye, you’ll will find a lot to be grateful for. It’s probably better than you think.
Don’t focus on taking enormous risks or receiving huge gains
If money has you feeling stressed and out of control, the first step is acknowledging you are going to make a change. You are going to take control of your money matters. You are going to have a positive relationship with your finances, even if it takes time and energy. You are going to transform from a bad-with-money person to an learning-to-understand-and-take-positive-action-with-money person.
I’d suggest you check out ASIC Smart Money to help; it has loads of tools and tips for managing your money.
Here are nine small steps you can take to nurture your gratitude and positive attitude toward money.
Notice luck. When you have a gratitude habit like the Top Five, you notice the small wins in life. You can also tune into how much “luck” you have: free tickets, a discount, generosity around you. During workshops, I sometimes ask participants about the last time they noticed generosity. Some people cite an example from that morning or the day prior. Others might think of something from months before. But some people can’t come up with anything! There is so much generosity happening in this world everyday; we just need to tune into it.
You can use the Top Five as a tool for being grateful for what you have. Take some time to think about all the wonderful things in your life: family, friends, a job, relationships, love, passion. Keep the momentum going each time you create a Top Five list. The Top Five helps you sort out what makes you really, super happy, and what doesn’t. When you realise that having 400 TV channels doesn’t actually bring any happiness to your life, you may reconsider the expense.
Take Michael Norton’s advice and consider allocating more of your disposable income toward things that will actually make you happier: experiences and giving to others. Start thinking about the people you’d like to shower with gifts.
Focus on your money goals — and not the goals of others. Don’t compare yourself. Don’t try to keep up with the Jones. Think about you and your financial priorities.
Investing can sound like a big finance-y word, but here’s a fun way and easy way to invest. One of my favourite things to spend money on is Kiva Loans, which are small loans that you can give to people around the globe who do not have access to traditional banking systems. It’ll make you feel great and make a difference in the world.
If you could create the perfect day, what would it look like? Who would be there? What would you do? How would you feel? Take some time to picture this. It’s glorious, isn’t it? Now, ask yourself this: Is money a barrier to having a perfect day? My perfect day would involve exercise, like a long hike or a fun way to move. Then it’d be onto brunch with friends and family, a seafood feast, ice cold white wine, games. Sure, if I had more money, I could plan this day several times a year and be able to move the location between tropical destinations. But without more money, these days still happen. Is money really a barrier to the best times in your life?
Give yourself money moments or meetings. Have a financial consultation with your partner once a week to take care of business. Check your balances, take note of any upcoming payment deadlines, talk about concerns and goals or discuss big purchases your family would like to make. That way, you won’t be stressing throughout the week.
If you are in financial hardship, take actions to take back control (Again, I recommend ASIC Smart Money). However, if you are not in financial hardship and you find yourself drawn to wanting to earn more, think about the feelings that earning more or having more money would give you (eg. freedom, joy, abundance, extravagance). And then set actions that will allow you to access these feelings in some other way (being with friends, meditating, going for a run, treating yourself to affordable luxuries).
Money: A Love Story author Kate Northrup suggests you can not only have a healthy relationship with money but that you can develop a love affair with your money. According to Kate, we are all seeking a feeling of abundance. She suggests you keep your refrigerator packed with healthy food and keep cash in your wallet. These are little ways of feeling “prosperous and empowered” — without breaking the bank.
Lastly, if you haven’t already, I encourage you to sign up for my regular so-useful-you’ll-thank-me emails. I am all over the best and brightest developments in the world of positivity and self development. So let me do the sorting for you and bring you only the most effective tools and tips to help you live longer, be healthier, happier, more confident, less lonely, more relaxed, more creative, help you bounce back from hard times quicker, experience improved emotional balance and even sleep better.
With loads of gratitude,