(Matt is someone who is deeply rooted in his family and beliefs. His approach to money management includes both of these important elements and in this post he shares his thoughts about how to achieve financial wellbeing.)
To say that you understand your own Financial Wellbeing is to say that you understand your own satisfaction level. It is in our nature as humans and certainly Americans to always want more, but can we want more and still be satisfied with what we have? I contend that this is possible. This is why I think we all must have both a short term and long term outlook on life. This is in our jobs, our families and certainly our finances. We must plan for the future, while taking care of the responsibilities of today.
To say that anyone of us will master all parts of well-being is just simply disingenuous. I certainly have not mastered it but I am likely further down this path than many. Why? Because we have stuck to the values of my life and been disciplined about my plans. Financial success isn’t about one big event but all the little events that add up to an “impact.” We have found that the more disciplined we are in those little decisions the easier the bigger decisions are to make.
Shortly after we got married and were living in the Residence Halls, my wife and I made a conscious decision to be “savers and givers” rather than “keepers and spenders.” We follow a base 10/10/80 plan in that we donate 10% of our income to charitable needs or to those in need, we save 10% and the rest is generally used for current expenses. However, when we were living in the Residence Halls we didn’t need 80% to live on, so the model became 40/10/50. With the extra we eliminated all debt, bought a vehicle, and saved for a down payment on a house. When we bought our first house we didn’t get a home that was exactly what we wanted but one that was reasonable and was well within our ability. All of these decisions affect our well-being. We are not strapped living pay check to pay check because we planned, because we helped others and in term God provides to us, and because we live within our means. This is a model that we have continued and now try to instill in our children.
In the chapter on Financial Wellbeing there are a couple of things that stood out to me as important.
- To attain financial wellbeing you must strive for selflessness: Much like many things in life – you become better and more successful when you can think of others first rather than yourself. I find this true in being a parent, a colleague, and a citizen. If I am willing to show my generosity towards others, then not only does my level of satisfaction increase but so does my success. I believe that God calls us to give to others. This giving should include our time, our talents and our treasures. As the authors suggest, if we are financially generous towards others, it will bring us more happiness.
- To attain financial wellbeing you must have discipline: Instant gratification through any type of financial transaction is generally short lived. That gratification doesn’t last but if the transactions are well considered to be within your value structure, it will lead to long term wellbeing. The values that I refer to are not superficial values or preferences but real core human and moral values. These are the values you would want said in your eulogy. The values that have nothing to do with brand names or the latest fad.
- “Keeping up with the Jones’s” is a recipe for continual unhappiness: Who do you compare yourself to? There are many of them and only one of you. Allow others to help drive you but don’t allow them to define you or the value of your purchases. Again this requires discipline but if you continually wish you had your neighbors car or house or landscaping, you are probably missing that your neighbor wishes they had your family, or marriage, or career. Judge yourself by your own or Gods standards not by the standards of someone else.
I should mention that I us the term “we” throughout this post in reference to my spouse. Being financially minded when you are in a marriage/partnership is not something that can or should be accomplished alone. We are firm believers that couples must mix their money so there isn’t a his and hers mentality. This has not only helped us financially but has had a positive impact on our marriage as forces us to think together is another way to realize that this life is not just about me.
I would like to leave you with a few random thoughts about this very topic of financial happiness. We as a society are so caught up on what others think, what others do, what others say, that we allow it to cloud our values and our decisions. In order to find the place in life where we can find financial fulfillment, we must be disciplined, we must know ourselves, we must help others and we must trust our God. Be frugal – not cheap; Be generous; not meager; be conscientious – not lavish.
Matt Bierman is the University Budget Director at Western Illinois University