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Let Your Values Guide Your Spending

How to save money by aligning your purchasing with your personal priorities

Alamy

Make sure you're spending your money on things that matter to you.

Last winter I spent four days in sunny San Juan, Puerto Rico, with my mother and college-age daughter, simply enjoying the city and time together. Was it an extravagance? You bet. Do I regret the expenditure? Not in the least.

Since my dad passed away nearly a dozen years ago, I've been more conscious of spending in ways that line up with the things I value—extended chunks of time with family being one of them. Turns out I've tapped a trend. A quick internet search on values-based spending yields more than 7 million entries. Research shows that whether we spend large sums or small, we feel better when our expenditures square with what we believe in, explains Lois Vitt, founder of the Institute for Socio-Financial Studies.

This is how to get started.

Log your purchases

For the next week or two, jot down what you buy each day, how much it cost and how you feel about spending the money. At the end of each week, note how you feel in hindsight about each purchase.

Create a mission statement

Try finishing these sentences to craft a statement of your own: I believe in _________. I value _________. Examples could include protecting the environment, improving yourself and not commercializing holidays. Then use the mission statement to shape your purchasing patterns, suggests Harvard Business School professor Michael Norton, the coauthor of Happy Money.

Favor experiences, not stuff

Research shows that if you spend the same amounts on an experience and a physical thing, the experience will make you happier in the long run, Norton says. "You go out to brunch and you're buying some quality time with a friend or family member."

Learn to substitute

Spending more than you can afford is, in and of itself, against the values of many people, Vitt notes. Look for an alternative that checks the same "values" boxes at a lower cost. For example, had my San Juan break been beyond my means, I could have spent time with my mom and daughter at home for a weekend full of local excursions, or cut the four days to two or three.

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