We live in a culture of wants and needs and we’ve been conditioned from an early age to place enormous value on material items — the fancy car, the big house, the designer clothing. It’s the brass ring many of us are constantly striving to attain and we often convince ourselves that once we get these things we will be happy.
Short Term Satisfaction
Think of the last exciting purchase you made, how long did that excitement last? A day, a week, a month? Odds are your zeal faded relatively quickly because the pleasure we get from most of our purchases is only temporary. When it goes away it is eventually replaced with a new want or need, which kickstarts the cycle back up again.
This is the very reason you hear people say, “How come I have everything I ever wanted and I’m miserable?” It all comes down to one very simple fact: getting what you want may give you pleasure, but it doesn’t make you happy.
Now this doesn’t mean you shouldn’t spend your money. Living a life of deprivation or becoming stingy with your finances is not the answer but you should be conscious and careful about where your pounds go.
Every pound that you spend can be seen one of two ways. You can see it as just a small portion of your income that you are spending today or you can see it as a small step towards building something great for tomorrow. Just one pound a day saved in only 50 years will grow to be £500,000 at a 10% average return!
The Little Things Add Up
Consider how you spend your money on a daily basis. Do you make a routine trip to your local coffee shop? How often are you going out to lunch? Do you make a habit out after work?
What value are these spending patterns bringing to your life? Odds are, not a lot, but by trimming wasteful spending you will find that you are in a position to make a significant shift in your financial health. The value derived from a more secure future can be substantially more rewarding.
Now consider the types of purchases you make on luxury items. How often do you shop online? Are you always after the latest and greatest piece of technology? What about the amount you are spending on clothes?
To make these types of cuts, it’s imperative to be aware of why you are making any given purchase. Understanding where your needs and wants come from will allow you to exert more control over your emotions, and will ultimately help you make more conscious decisions of where to spend your money.
Where’s the Value?
When we make these kinds of decisions unconsciously we end up with lives, like the majority of people, who try to find fulfillment in all the wrong places while neglecting what really matters — your relationships, your health and your emotions. Not to mention, we often end up financially stressed, continually pouring money into items that add no real value to our lives.
Before you make a purchase, it’s important to check in with yourself to see what you are truly after — a sense of joy, freedom, security or love — or to assess whether you have simply developed a habit of frivolous spending that needs to be scaled back.
Measuring True Wealth
Each of us finds a pathway we believe will lead to happiness, fulfillment or meaning and there are countless paths you can go down, but true wealth cannot be measured by how much money you have or the number of things you own, it comes from creating an extraordinary quality of life and only you can determine how much and what type of value a purchase will add to your life.
So start to get smart about how you are spending your money, realign your habits with the goal of creating real value in your life. You may just be surprised by what happens.