Mastering the Money Decision-Making Process

We’re a couple weeks into 2018, a time when many people are still riding the motivation high of their New Year’s resolutions.

People resolve to save more and spend less, pay off debt, and accumulate funds for a future purpose.

But even if you have those goals firmly placed in your mind, when it comes to the action steps and decisions it takes to reach those goals, many people battle internal thoughts and external stimulus.

There are two voices playing in your head. Typically, one voice outshouts the other, making it the winner of your decision-making process.

There are several types of conversations that might play out at various times.

For example, one voice might be urging you to spend on something fun or frivolous, while the other tells you that it won’t be quite as much fun when the bill comes in next month.

It might sound something like this:

“Wow, look at that __________! You’ve always wanted it!”

“Gee, yeah, I’ve been thinking about buying it. But, I don’t know….”

“Come on, you KNOW you want it. You deserve it, you work hard!”

“I’ve been working really hard to keep my spending under control…”

“Which is one of the reasons why you should have it. You know, a reward for how well you’re doing!”

“It feels really good to have a small credit card bill to pay each month.”

“Yeah, but one month won’t kill you. You know you’ve been craving it.”

“It is pretty cool and I could probably swing it. But, I don’t know, we’re putting money away for the kids’ summer camp and for college.”

“So, you’re just going to work like a slave just for your kids? What about your needs?”

“Hey, who are you calling a slave? I know what’s important…usually.”

The internal conversation continues until one voice wins — causing you to spend or save.

Your inner voices battle, unless one is clearly stronger than the other, and it will lead you to one of two paths: living closer to your values or money misery.

The good news is that you know what to do and which voice to heed.

The bad news is that sometimes, the cacophony is simply too overbearing to find clarity.

It might take a “third party”, so to speak, to help you decide: your gut.

The voice that is urging you to go off plan will typically awaken that feeling in your stomach reminding you about that something that might not be aligned with your values.

Your gut feelings are worth trusting.

You know from your money history whether your decisions have led you towards positive outcomes or frustrating problems.

Here are 5 action steps to making the right financial decisions:

Make a list of the last five financial decisions you’ve made.

Which voice swayed your decision?

If you could go back and do it over, would you make the same decision again?

What did you THINK about when making the decision?

What did you FEEL when you made the decision?

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Chances are, you might not even remember what you thought or felt—your decision might have been that quick and decisive. But nonetheless, there was a process.

Whether it was deciding on purchasing a bottle of water, a snow blower, or to invest in a particular security, you went through a process of deciding.

As you begin the New Year, resolve, if nothing else, to be present and aware of your decisions and whether those decisions are being made with your values in mind.

Be aware of which voice is speaking and whether it is pulling you away from your goals or supporting your choices to live within your financial boundaries.

Check in with your gut and decide whether what you’re “hearing” is genuinely what you want.

Your awareness is necessary in order to achieve financial success—there are no magic bullets or potions.

There is only you, your values, and your ability and willingness to listen to the right voice.