Typically, when you think of your financial situation, your initial thoughts may not immediately gravitate toward your values. Instead, your attention may be drawn to addressing existing debt or striving toward your long-term financial objectives. Similarly, discussions about finances tend to revolve around external factors like interest rates, while internal factors like your core values stay in the background. Occasionally, it might even seem as though your life’s guiding principles and the pursuit of financial success are in conflict. However, building a values-based financial plan allows you to bridge the gap, as well as offering other meaningful benefits.
A values-based financial plan offers you the opportunity to pursue your financial objectives while remaining faithful to your authentic self and the most significant aspects of your life. Fortunately, the process isn’t complicated. Read on to learn more.
Identifying and Understanding Your Values
Before diving into the nitty-gritty of your values-based financial plan, it’s crucial to clarify your values. These are the principles and beliefs that guide your decisions, actions, and, ultimately, your life. Your core values can encompass a wide range of areas including family, education, community, personal growth, health, the environment, social justice, and more. Take some time for introspection to do a values check and identify what truly matters to you. We rarely find ourselves compelled to deeply contemplate our core values, so allocate ample time for genuine introspection on what holds the most significance to you.
If you’re not sure how to get started, ask yourself these fundamental questions:
- What are my long-term goals?
- What do I want to achieve in life?
- What brings me happiness and fulfillment?
As you think, jot down ideas and thoughts. Soon, your core values will begin to come into focus and you’ll have a better understanding of what you hold dear. This will inform your values-based financial plan as you move forward.
Most people have more than one core value, and that’s okay. Once you’ve identified them, take time to prioritize. Rank your values in order of importance, narrowing your list down to approximately five key values that you want to prioritize in your decision-making going forward. This exercise will help you make decisions that are in alignment with your core beliefs.
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Let Your Values Guide Your Decision-Making
Building a values-based financial plan certainly means clarifying your values, but you’ll need to do some introspection on the financial side, too. Managing your finances effectively can be challenging without clear objectives in mind. To maintain financial stability and make wise decisions with your money, it’s essential to establish both short-term and long-term goals, and then create a financial plan to achieve them.
Take those five core values you’ve named and use them to help envision what you want your retirement to look like. Rather than viewing retirement solely from a monetary perspective, consider what activities and commitments you envision for your retirement years.
If you’re having trouble thinking into the future, ask yourself questions like:
- How do I want to spend my time during retirement?
- Who do I want to share this phase of life with?
- What will provide a sense of joy and fulfillment?
Once you have a clear vision, work backward to determine how much savings will be necessary to support the lifestyle that aligns with your fundamental financial goals and your core values.
Investing with Purpose
In the last twenty years, there has been a notable surge in the number of people exploring socially responsible or mission-driven investment opportunities. This type of investing was traditionally reserved for large institutions but has become increasingly accessible to individuals. With the rise of concerns related to the environment, sustainability, and data privacy, the appeal of ESG (Environmental, Social, and Governance) investing has also grown. If you’d like to know how Flourish Wealth Management can help you align your portfolio with your values, learn more here.
By harmonizing your values with your financial objectives, you can not only generate investment returns but also derive a profound sense of satisfaction from knowing that your investments align with causes that hold personal significance. In this way, your investments become a source of fulfillment on multiple levels.
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Building a Values-Based Financial Plan for Deeper Satisfaction
You may have a savvy financial plan in writing. You may be on your way to accomplishing many of your financial goals. You may even feel very financially secure. However, it’s possible to find meaning and purpose when you also incorporate the values you hold most dear and create a values-based financial plan to maximize the potential of your life and your wealth.
As you develop your plan, remember that the ultimate goal is to make your money work more effectively, accomplishing your financial aspirations while also contributing positively to the world around you in ways that matter to you. The key lies in knowing your core values and then being intentional with your financial decisions, from everyday expenses to long-term investments.
Identifying your values is an inherently personal journey, and though it can be done on your own, collaborating with a financial advisor can help ensure that your financial strategy both incorporates and advances your core values. At Flourish Wealth Management, we understand that a firm grasp of your values is pivotal in attaining your financial and life objectives. If you’d like to begin a conversation about how you can better incorporate your values-based financial planning, give us a call today.
