Setting Meaningful Money Resolutions (EP.133)

0:29We all need to make smart decisions with our money. where there lived a king named Midas. King Midas was known not only for his wealth and power, but also for his insatiable desire for more. Midas believed that true happiness and security could only be found in the shimmering allure of gold. But one day, Dionysus, the god of wine and revelry, offered Midas a wish as a reward for his kindness. But blinded by his greed, Midas wished that everything he touched would be turned to gold, which at first seemed like the ultimate boon. Leaves, stones, and objects all around him gleamed with the richness of solid gold.

1:09But soon, the dark side of his wish became apparent. The food and drink he touched turned to inanimate gold, leaving him starving. The flowers in his garden lost their color and fragrance replaced by the cold, hard sheen of metal. But the final heart-wrenching blow came when he embraced his beloved daughter, only to see her transform into a golden statue devoid of life. Midas had wished for wealth, but what he received was a life stripped of joy, sustenance, and love. This time of year, many set financial resolutions hoping to find security and happiness in wealth. We strive for higher salaries, larger portfolios, and bigger savings accounts.

1:54But Midas's lesson is very clear. Wealth, in its purest form, is not an end, but a means to an end. In this episode, we'll explore setting financial goals that transcend mere numbers by discussing how to create a balance. And by the end of this episode, I hope to inspire you to create a New Year's resolution that enhances your holistic wealth. And I'd love to hear about it. So please leave a review for this episode in your podcast app, or you can reply to my next email and I'll be sure to respond. Remember, you can sign up for my emails, which come out every other Wednesday near the top of each episode show notes at thelongterminvestor.com.

2:39Now, when we talk about financial resolutions, it's crucial to understand that true wealth transcends the confines of bank statements and material possessions. Think about the richest moments of your life. Chances are, they aren't when you earn the most money, but when you felt a deep connection with others, achieved something meaningful, or experienced profound joy. Achieving this type of holistic wealth requires making decisions that balance securing your future with living fully today. And the first step in doing that is setting meaningful financial goals that look beyond the numbers. It's easy to get caught up in saving a certain amount, earning a specific income, or reaching a particular net worth.

3:23But what do these numbers represent? They are tools, means to an end. So I'd like you to think about what is your why? Is it the peace of mind that comes with financial security, the joy of being debt-free, or the satisfaction of knowing you can retire comfortably? Think about the life you want to lead and how your financial goals can facilitate that life. It's not just about having a certain amount in your retirement account. It's about what that amount enables you to do, whether that's pursuing hobbies, spending time with loved ones, traveling, or simply enjoying the peace of knowing you're financially secure.

4:06Now, setting meaningful financial goals requires a long-term vision. It's about looking beyond the immediate horizon and planning for the future. This doesn't mean sacrificing present happiness for future security. Rather, it's about finding a balance. Your financial planning should include short-term goals that bring immediate joy and satisfaction, as well as the long-term goals that ensure your future well-being. And if you'd like some help, you can download my goal planning guide in the show notes at longterminvestor.com that takes you step by step through the same short-term, intermediate-term, and long-term goal-setting exercise that I use myself.

4:47But I also think that this is one of the most underappreciated things a real financial advisor can help you more clearly define. And I like to think a real financial advisor, and I'm emphasizing real the way that Carl Richards did and spoke about at length in episode 100, I like to think of a real financial advisor as being the ghostwriter for the story you want to live. Achieving financial independence is undoubtedly a pivotal chapter of that story, but such a story wouldn't be captivating if it only revolved around saving and investing. A more compelling narrative would depict how you made strategic choices and how those choices resonated with your vision of a fulfilling life, balancing the joys of the present with the promises of the future.

5:37Now, think for a moment about what matters most to you. Is it the freedom to travel, the ability to provide for your family, the opportunity to give back to your community, or the pursuit of knowledge and personal growth? Your financial goals should reflect these values, serving as stepping stones towards a life that resonates with your deepest beliefs and aspirations. For instance, if family is central to your life, your financial goals might include saving for your children's education or planning family vacations that create lasting memories. If personal growth is your priority, consider setting aside funds for courses or experiences that enrich your understanding of the world.

6:20Now, once you have set meaningful financial goals, the next step is to align your spending and investing with them. Mindful spending and investing are not just about being frugal or seeking the highest returns. It's about making financial choices that resonate with our values, goals, and the kind of life we aspire to lead. The most impactful exercise on this front relates to conscious consumption, which is less about cutting back on spending and more about aligning your spending with what brings you genuine joy, satisfaction, or utility. My favorite exercise is one I've written about in the past in which you print off the past three months of expenses from your credit cards and banks and score each expense as high value, medium value, or low value.

7:09If you have a significant other, then you should each score the expenses separately on your own and compare your answers once you've completed the exercise. Now, for expenses that you've ranked as low value, those are obvious ones to seek to eliminate. Now, there's obviously going to be expenses where you and your significant other have different responses, and perhaps that warrants conversation. A more common piece of advice for mindful spending is eliminating impulse purchases. Now, that can be easier said than done, and some people find it helpful to make a list of what you need to purchase whenever you go to any store, and then don't purchase anything else.

7:47Now, if you feel like there's something else you need once you're at the store, then just ask yourself, do I need that item in the next week? And if not, skip the purchase. The other trick I hear people talking about a lot is just removing all the shopping apps from your phone because it has never been easier to buy online. So removing the temptation altogether can sometimes be easier than simply trying to resist. Now, I've been focused on cutting expenses, but I actually think a more interesting conversation in aligning your spending with those more meaningful financial goals is making certain expenditures and investment in yourself.

8:26For example, investing in something that frees up your time for you to grow a business, spend time with family, or enjoy a hobby can greatly enhance the quality of your life. Or you could invest in your personal development by hiring a personal trainer or an executive coach. Investing in yourself is as simple as understanding when the benefits from an investment are worth the resources at stake. But either way, practicing mindful spending and investing makes it easier to see how our financial decisions have the potential to shape our lives and influence our happiness. So as you move forward into this new year, I encourage you to reflect on what wealth means to you.

9:07Think about how your financial decisions can align with your life's purpose and how each choice can contribute to a rich, fulfilling life. Set goals that are not just about numbers, but about what those numbers will enable you to do, to experience, and to share. As we wrap up today's episode, I want to express my sincere gratitude for joining me in this exploration of financial well-being and life balance. Your presence and engagement are what make this conversation truly special. Before signing off, though, I have a small yet significant request. If today's discussion sparked any thoughts, insights, or revelations for you, please consider leaving a review wherever you're listening to your podcasts.

9:54Your feedback is incredibly important because it helps me identify what topics, stories, and discussions are most useful and meaningful to my audience. This, in turn, allows me to continually improve the quality of the show, ensuring that each episode brings value, insight, and enrichment to your life. Every comment allows us to reach and inspire more individuals like yourself. By sharing your experience and insights, you're not just supporting this podcast, you're actively shaping its future, helping us create content that truly matters to you and to our growing community. So if you could spare a moment to leave a review on Apple Podcasts, Spotify, wherever you're listening to your podcasts.

10:38It would be immensely appreciated. Thank you once again for your time, your engagement, and for considering this request. And until next time, here's to a year of mindful financial decisions, meaningful goals, and a life richly lived. Thanks for listening to the Long-Term Investor Podcast. To access free financial resources and submit questions to be answered on the show, visit the long-term investor.com.

11:33Thank you.