Xentum | Money habits – how to spend strategically

Money habits – how to spend strategically

January 19, 2021 - 4 minutes read

Posted by Claire Parker

In your business life you spend strategically against a budget, so why wouldn’t you bring the same discipline to your personal finances? If you know your company cash flow, you should know your personal cash flow too. Developing good money habits is key.

couple walking on sandy beach

Without a properly thought-out plan based on a clear vision and goals, our finances can take on a life of their own. In reality, many of us are simply unaware of where our money goes. This may be fine in the short-term, but over a longer period, this can become a huge waste of the opportunity to make your money underpin the life you want to lead.

They say money can’t buy happiness, but it can certainly make our lives more comfortable and enjoyable. That’s why in our WealthPlan™ method we emphasise the importance of taking the time to craft a vision for how you want to live. It is this inspired vision that will help us pinpoint exactly what you and your family want to spend your money on so that you can then make the necessary changes and direct funds to invest in the things that bring you peace of mind and real, lasting happiness.

Take the long-term view

We’re not talking about the discipline to manage your everyday spending but rather about prioritising the big things that are truly important to you. Strategic spending is based on pre-considered priorities and goals. It’s about knowing what add value to your life and directing your money towards those things, taking into account both the long and short-term.

Some of these things you will see – a dream house, for example. Others you will experience – a trip of a lifetime to the Serengeti, perhaps. And then there are things that money helps you become – generous, for example, able to use your time and resources to help others.

The key is to have the vision and foresight to spend or invest in things that add value to your life, and you save or invest the remainder, so that you have an accumulation for peace of mind and future enjoyment. That’s why we take the time to help clients to craft their inspired vision, and then work with them over the long-term, ensuring that vision remains front and central to all financial planning decisions.

It takes time and effort to get into the habit of spending strategically, but the benefits make it well worthwhile. Naturally, strategic spending means you waste less, so you have more funds to direct towards things that make a difference to your life.

Take control of your finances for a comfortable future

Whether you want to achieve a long-held dream, retire early, help others, invest in shared experiences with the people you love, or simply treat yourself to material possessions you really want, money is the tool that will help you achieve your life goals. The key is to employ the tool to craft the life you wish to lead, not to allow money to dictate your choices.

The way we think about money is often deep-rooted in our past

If you investigate your personal relationship with money, you may find that you’re the kind of person who was taught the ‘value’ of money from an early age, or maybe you’ve never thought of it as anything other than a means to an end – just something you buy things with. You may think of money as a way to make more money, but whatever your viewpoint, when it comes down to it the reality is that money is simply a way of storing value.

5 quick questions to ask yourself:

  • Why is money important to you?
  • Do you know your exact monthly earnings?
  • How much does your family spend every month?
  • Are you happy with your income?
  • What 2 or 3 things do you spend most on every month?

If you think carefully about the answers to these questions, along with what you were taught about money growing up, you’ll have a better understanding of your relationship to money, which in turn will help you to question whether those beliefs are helping or hindering your process of becoming a strategic spender.

Think of it as an opportunity to recalibrate your finances to make sure your current and future financial arrangements are being utilised in a way that reflects your personal values and life goals.

Take advice on strategic financial planning

As a business owner you’re probably so busy with running that business and controlling the company finances, that you may lose track of family finances along the way. That’s why it’s crucial to take the time to understand your personal cash flow, because once you start to work out the exact numbers for what you really want to be able to spend your money on, you start to build a financial future that offers the things that really make you happy.

Strategic financial planning advice from the professionals is a very useful tool to have in your armoury, once you’ve taken the time to understand your personal relationship to money and what makes you tick moneywise. Because making your money work hard for you is the ultimate end game.