Waste not, want not - the value of knowing your values

Using your money in a way that aligns with your values will make you feel more in control and content. Here are three simple steps to get yourself in-line:

Step 1. Verify your values

As the saying goes, “the checkbook and calendar never lie.” Sure, our bank account will tell us what we prioritise with our money, but it’s not always a true reflection of what’s most important to us. If you feel guilty or uneasy about certain areas of your financial life, it’s a good indication that your money is not aligned with your values.

If you’re struggling to define your values in an actionable way, have a read through of this article: List of Family Values, which organises types of values in a really helpful way as well as offers tips for making your own family’s list.

Whether it’s due to a lack of clarity of values or simply a lack of time and energy, many parents don’t talk to their kids about values. BUT everything you say and do sends subtle, yet influential, messages about your values – whether it’s intentional or not. Children learn a lot about values through allowances – values are choices and giving your child an opportunity to manage their own can provide many many teachable moments. Check out Start as you mean to go on to learn more about how to get started with an allowance.

Step 2. Consume consciously

“If you think money can’t buy happiness, you’re probably not spending it right,” claim the behavioural scientists behind the book "Happy Money: The new science of smarter spending". The book gives good insight into why you can get more happiness from your money by following five principles: 

1.    Buy experiences – The memories last and the benefits will outlive any material thing.
2.    Make it a treat – You’re less inclined to appreciate something that’s always available.
3.    Buy time – Hate cleaning? Pay someone to do it for you! *my personal favourite*
4.    Pay now, consume later – You’ll benefit from the anticipation and avoid the buzzkill.
5.    Invest in others – We all know how good it feels to help others, financially or otherwise.

Conscious consumerism in the more classical sense is a movement whereby consumers ‘vote with their wallet’ by buying ethical products, avoiding unethical companies, and sometimes not purchasing at all. Eliminating impulse purchases and opting for companies and products that create a positive impact would arguably be consistent with most people’s values.  Be sure to talk through your decision-making process when you’re making these choices – for instance, share why you’re choosing organic or fairtrade or one brand over another because they give to charity and also point out products and brands you avoid and why they don’t align with your values.

Step 3. Invest intentionally

Regardless of what you’re investing in, always begin with asking Why? Being really clear about your goals will go a long way to ensuring satisfaction with the outcome of your investment. When it comes to investing your money in the markets, knowing how much you need and when dictates the investment strategy and investing in a way that’s inconsistent with your goals and time horizon is unlikely to yield the right results. For instance, keeping your retirement savings in cash or investing your down payment in stocks when you hope to buy a home in a couple of years are both examples of misaligned strategies.

Investors today are increasingly interested in investing in a way that considers both financial return as well as the social or environmental impact of their investment. If you’d like to invest your money in a more socially responsible way and want to learn more about what that means exactly, check out The sustainability factor to get up to speed.

Investing your ‘time, talents or treasury’ in charitable causes you care about, and being intentional about the impact you want to have is another good way to align your money with your values. Talking with your children about some of the ways you give back and some of the organisations and causes you support is a great conversation starter and opportunity to explore why you think giving is important.

Say it out loud

As a family, we make choices every day that are driven by our beliefs and ideals – our children see us living our lives and making these choices, so it’s important to think about how our kids are making sense of the trade-offs we’re making and what our habits and attitudes say about what we value.

We take for granted the decision-making that goes on in our head every day and teachable moments are missed when all the child sees is the end result without even knowing there was a choice in the first place. Simply saying out loud the questions you’re asking yourself or the things you’re comparing in the process of deciding, can be a great way to demonstrate your values. 

Children should know why you drive an older car or a hybrid, why the youngest wears hand-me-downs, why you shop at the local market, why you recycle or why you’re saving and what you’re choosing not to spend money on. Even if a child isn’t ready for the facts and figures, they can understand the decisions you make and the impact they have.

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Cents for Kids is focused on building financial literacy in children and supporting parents with the tools and resources they need model good money sense and teach their kids about money.

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