Personal values determine behavior more than most of us realize. When we connect our values to our decisions, we give ourselves the option to craft meaningful choices that support long-term personal, professional, and financial growth. How we manage our money is one of the principal ways we express our values. Here are three ways your values can help in making financial decisions.

1 – Structure Your Salary Negotiation

In few areas are our values more important than in finding the right role and salary. Compensation packages vary widely, and understanding your values will help you sift through to what matters most to you. The key is to tie your values into your over-all proposition for a position, not to focus on trade-offs. For example, many women tend to lower their salary request, in hopes that this will increase their position to request more flexibility in their schedule. The problem with this type of trade-off, is that it doesn’t let your employer see how your values let you help them.

Instead, if you value relationships (which is partly why you are focused on flexibility to be with your kids), you might phrase this in terms of how your value of relationships has enabled you to collaborate with others in your organization outside your specific department. The early discussion with those outside your department enabled a faster decision or less indirect hours on a project. Your value no longer simply equates to less company time. Your value of relationship and connection is now something that directly benefits this company.

2 – Simplify Your Spending

One of the greatest benefits of knowing what you value, and recognizing how you want to express that value is that your spending can be simplified down to a handful of areas. Perhaps you have independence in your top values. If you value independence, you will likely want some money set aside to let you pursue your own goals and interests.  You may put your money toward developing additional income streams, such as dividends from stock or real estate. You may avoid purchases that require financing, so you are unencumbered, or you may focus your dollars on paying down debt you currently have. Whatever the case, you will likely want to spend your money on areas that give you a sense of liberty and self-sufficiency. That may mean prioritizing a lifestyle where you can take time off, rather than acquiring more things.

3 – Focus Your Behavior

Advertising leads you to believe that more things and experiences bring more happiness in equal measure each time. Not true. If one milkshake on a warm afternoon makes you happy, another might increase your happiness, but not necessarily by the same amount that the first milkshake gave you. A third milkshake will give you a stomachache.

Focusing our financial behavior means we put our money on the things that support our values in the right proportion and quantity. If you value security, you may find you put more money toward retirement investing. A holistic view of retirement, however, might indicate that you have interests that may require less income set aside now. Security is often more than a specific number, although that number can be helpful. By delving into how you want your value of security to show up today and into the future, you can put the money into the correct perspective. 

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