Every dollar is equal, right? Research out of the University of Cambridge suggests that might not be the case. You might actually be able to get “more” out of your dollar by making sure that your spending is aligned with your values. Values-aligned spending is something we believe in deeply here at The Beans.
What is values-aligned spending?
What does it mean to spend in accordance with your values? A few things. One of them is something we like to call the Marie Kondo Effect, based on the Japanese organizer’s philosophy that you should seek only to keep items that “spark joy.”
Get yours. Joy, that is. Discover how you can maximize the joy out of each dollar and understand that only you can define what that looks like. Sometimes that means spending money on things that don’t “make sense” – Lilia, a sixth-grade math teacher in Atlanta, spends a percentage of her income that she’s almost embarrassed to share on an Orangetheory fitness membership, but she has no regrets. “…The feeling that this gives me every day and the commitment and life outside of work give me more joy and happiness than I could get in a different way. That is something I really value.”
Quality over quantity.
Part of maximizing joy in dollars spent is also understanding the law of diminishing returns. Josh, an aspiring writer and outdoors enthusiast, quickly discovered that the more money he spent on outdoor gear, especially in a short period of time, started to lose its luster. Values-aligned spending isn’t about spending as many dollars as possible on the things you enjoy, it’s about being smart about how your brain works. There’s a desensitization effect that happens over time.
Josh says, “You eat your first donut and you enjoy it, but you enjoy it even more when you’re just thinking about it and you know you’re about to have it. That’s actually when the dopamine is at its highest level.” Use this knowledge about your brain to your advantage!
Balance is key.
Remember your abundance. This fascinating article at 80000hours.com will remind you why you got into a helping profession. You have already unlocked what so many people struggle to – job satisfaction is not just about a paycheck.
Invest in others.
Behavioral scientists have also demonstrated that you can get more out of your money by spending some of it on others rather than yourself, as detailed in the book Happy Money by Drs. Elizabeth Dunn and Michael Norton. They show that spending money on others rather than yourself can make you feel healthier and wealthier, even if it means rebalancing your Plan to reap these benefits. One study revealed that giving away as little as one dollar can actually cause you to feel more flush! It’s not just about money.
Money is not the only thing we “spend”, right? We also use this verb to describe how we use our time – it also gets “spent.” Which means it must be a pretty precious commodity. While you’re re-evaluating whether your dollars are aligned to your values, consider evaluating your calendar as well. See if it represents what you truly want your life to be about. As the saying goes, if you don’t choose your sacrifices, life will choose them for you.
Take away
The effect of values-aligned spending on your happiness is actually stronger than the effect of your total income or total spending. It seems scientifically impossible, but it’s been scientifically backed.
Carl Richards of the New York Times reminds us that our time and money won’t be spent perfectly, but the old saying, “The checkbook and the calendar never lie” ring true. Those two items tell us more about our practical values than anything else. Take a moment and reflect on your values, find a balance, and create a personal manifesto for “spending” that you’re proud to call your own.