Discover Your Money Values and Financial Demons

By Pinyo, on September 7, 2007

I am still reading Your Money or Your Life by Dominguez and Robin — this book is taking longer than I thought because it is not just a book, but a road map to financial independence. One idea that stuck with me was the step that told you to keep track of every pennies to answer the question: where is it all going?

Photo by Gracey via MorgeFile

Frankly, I do not like to complicate things. I am happy as long as I have money to spend and my net worth continues to rise each month. However, I think this exercise is worth doing — as tedious as it is. The concept is to keep track of every pennies that you spent (or you and your family), then assign each expenditure to a category.

Money Values

Unlike standard budgeting, you have to come up with your own categories. This is where you discover your money values:

• Do you consider beers food, entertainment, or drugs?
• Do you consider a second car transportation, hobby, or ostentation?
• Do you consider clothing vanity, utility, hobby, or work related?

These are just a few examples. This exercise forced you to think about how you view your expenses, and give you a glimpse into your financial self.

Financial Demons

After you do this for a while, you start to see patterns and abnormalities. If you have been honest with yourself, you might be able to discover your financial demons. For example:

• Do you overspend on shoes? For instance, you have shoes for every occasion — e.g., dance, hiking, biking, roller blading, skiing, etc.
• Do you overspend on eating out?
• Do you overspend on booze, cigarette, drugs, clothing, etc.?
• Do you have expensive hobbies?

With this discovery, you could begin to tackle your financial demons, stop the money leaks, and restore your financial balance. It is hard to do justice for this great book with a short post. If you have not read the book, I highly recommend it.

This article was featured in the Carnival of How to Solve Money Worries hosted by Widow’s Quest.

Read more about

Get free updates

    via Twitter
    via Facebook
    via RSS or Email

Share this article

• 
• 
• 
• 
• Share

Pinyo is the brain behind Moolanomy personal finance blog and a few other web sites. If you like this article, please subscribe for free daily email updates.

All posts by Pinyo

Please share your comment:

Comment Rules: Constructive criticism is welcomed. Please use your PERSONAL name or initials and not your business name or URL, as the latter comes off like spam and I'll most likely delete your comment. Have fun and thanks for adding to the conversation! Here's our comment policy and guidelines.

2 blogs that link to this article:

If your trackback does not show in 24 hours, please resend to this trackback URI.

1. Personal Finance Review - I Have No Pension Edition » Money Smart Life
2. How to Solve Money Worries