Wednesday, March 28, 2012

The Lenten Journey: Reflection on Personal Finance | Lance's World

Research conducted by the Gallup organization shows that financial security has nearly three times the impact of income alone on employees? overall wellbeing. Essentially, this means that it isn?t just the amount of money that a person has that influences their wellbeing; rather, it is the perception of how secure they are that has the larger impact on wellbeing and quality of life.

The concept of security is an interesting one. There was a time in my life when I thought I needed to own a home worth at least $10 million, have a chauffeured limousine, and fly first class everywhere I went with no regard for the cost. In fact, I even made a deal with one of my best friends from Notre Dame that, as soon as I made my first million in cash, I would fly him first class to visit me from wherever he was at the time. He made a reciprocal offer. Now, while I was fortunate to have successful parents who could provide for all of my needs growing up, I wasn?t born with a silver spoon in my mouth by any means. As such, by establishing goals of this nature, I was really just setting myself up to feel consistently unsuccessful. I?m certainly ?wealthier? now than I was when I graduated from college 8 years ago, but I?m far from that dream. If I were still so focused on security as having magnificent material possessions, I would wake up each morning and be constantly disappointed that I wasn?t in my mansion yet. (Though, $10 million doesn?t go quite as far in San Francisco as it does in Utah where I was still living when i started telling people about my goal.)

I can?t pinpoint a specific time that it happened, but at some point in the last 5-10 years, I considerably shifted my focus. No longer does financial security look to me to simply be the accumulation of wealth; rather, financial security for me is knowing that I am simply making enough money to not have to worry about money. I hope one day to have a family, and I would like to be able to raise my children similar to the way my parents raised me ? providing all of those things that they need to be happy, healthy, and successful, but also providing them with opportunities to learn the value of money and showing them how to make good, informed decisions about the things they buy.

They say that money is one of the most common points of contention in the married life. Having a low sense of financial wellbeing is linked not only with tension in the married life, but also with a host of other issues, including stress, anxiety, insomnia, headaches, and depression. It is sad to think that many of these issues could be avoided if people spent more time being thankful for what they had than focusing on the things that they wanted but didn?t or couldn?t have. Granted, if you?re not able to put food on the table or keep a roof over your head you have a real, serious grievance; however, for those people that have all of their basic needs met, I would strongly encourage you to spend more time being grateful for the good things in your life.

Running my own business and being self-employed, I?m in a unique position. Unlike most people who have jobs, in the good times, I have a greater degree of control over how much I get paid, but there are also bad times where I?m at much higher risk for not getting paid anything at all if we have a slow month or a slow year. Despite this added risk, I still do my best to maintain a sense of financial security. Part of this is accomplished by closely examining how I spend the money I do have. There are so many businesses and opportunities competing for our hard-earned money, and it is important to be very conscious of the choices we are making in where we spend those dollars. When I worked for UC Berkeley, my boss there, Michael, was fond of saying, ?people vote with their feet.? And Fr. Xavier, the Pastor at St. Dominic?s, often says, ?you can tell what is important to a person by looking at two books ? their checkbook and their datebook.? I?ll examine the Lenten discipline of Almsgiving in greater detail in my post on Fiduciary Duty, but during this Lent, I would encourage to take a close look at the ?vote? that you?re casting and then making sure you have your priorities in order. Controlling spending is one of the most important things people can do to improve their financial wellbeing, but it is even more important for those people who have seriously a limited income.

Again, I?ll address this in greater detail in the next post, but the Gallup organization also found that people can improve their wellbeing by spending on others or giving to charities instead of spending only on themselves! This may seem strange at first, but I have seen this in action time and time again. Those people who are the most giving and the most generous tend to be the happiest with their lives. Even those who seem to have very little, but who nonetheless give from what they do have, can be extremely happy because they aren?t placing all of their value on the amount of money they have; rather, they are looking to make sure that they have some level of security, and they make every effort to see to it that others can also enjoy the same or a similar level of security.

This is the third in a series of Lenten essays exploring different areas of the human experience. For more information, see the introduction.

Source: http://www.lancesworld.com/2012/03/the-lenten-journey-reflection-on-personal-finance/?utm_source=rss&utm_medium=rss&utm_campaign=the-lenten-journey-reflection-on-personal-finance

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