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Your Money Mindset: Are You Unconsciously Spending on Likes Not Loves?

A few years ago I found myself wondering why I was buying the things I bought. Why did I need to own two cars, a motorcycle, live in an expensive apartment, or have a walk-in-closet filled with clothes with  tags still on them? Why did I need a new phone each year or get the latest tech gadget? Did I really need to spend $40 per night on dinner or go out for a weekend bar crawl and spend $200-300?

I was living life and enjoying it but I also felt unsatisfied. Something was missing and I was trying to fill it with things such as an $1800 watch and weekend retreats. I was making money but I was also spending it. I didn’t have a plan aside from stashing money into my 401(k), buying stock through my company’s ESPP (employee stock purchase program) and holding onto debt. I also held onto debt because it became a purpose for me to work.

It sounds strange but it’s quite true. I realized my relationship with money, credit and debt had to do with the lack of knowing who I was, what I loved and what I was working towards. I’ve often talked about how I’ve followed the plan from a college graduate to a senior executive. I had what some may call the perfect story but I’ve had my ups and downs.

There are still many things people don’t know about my journey.

For one, while attending college, I worked 60+ hours a week and took up to 19 credits a semester at Rutgers. I needed to work because I needed to pay for tuition. I made enough for school but since I was bad with money I was squandering it. For example, all that hard work at school and my job, I rewarded myself with a brand new BMW. On the upside, I realized that if I truly wanted something I could achieve it through hard work and determination.

I started my career at the airport as a bartender serving drinks, washing dishes and cleaning toilets to vice president of Silicon Valley credit union in under 8 years. Even when I made a leap in the amount of money I made from hourly to salary, I still had the wrong money mindset.

Money mindset? Glad you asked.

There’s been a lot of talk lately about money mindset or money mindfulness. I’ve also read tons of articles on conscious spending. Basically, all these hippy new age words focus on awareness – financial awareness to be more specific. And I couldn’t agree more.

Mindfulness is an increase attention to how we feel, think and react to the world around us. When it comes to finances such as wanting a bigger home, larger paycheck or dream vacation and faced with the reality of debt, bad credit, low income or bad investments, we end up making decisions that compound the problem. During these financial moments, our decision-making is strongly influenced by our unconscious feelings and behaviors.

When I had extreme amount of debt I spent more money and all I could think of was my inability to buy the things I wanted yet I bought many things at a whim.

Learn More >>> The Psychology of Spending

The reason why we don’t have a fulfilling life is not because we’re spending the money we make rather we’re spending the money on things that really doesn’t matter to us. That’s the part of our unconscious spending. We fear we don’t have enough so we make rash irrational financial decisions. Let’s forget about the personal finance motto of putting needs over wants. When we live without financial awareness, we continue to spend on likes not loves.

Again, what prevents us from our dream lifestyle is that we’ve put likes over loves.

I’ve heard an acronym said many times throughout the years but just never knew how it applied to money. That acronym is “WANELO” which stands for Want, Need, Love. The premise is to prioritize spending on things you absolutely love.

Take a step back and ask yourself, “how many purchases have you made that you only liked and didn’t really love?” Quite a few? You’re not alone.

Imagine all my $40 dinners I had in span of a 30 days. That’s $1200 enough for an all inclusive trip to the Dominican Republic for two people. I would complain I didn’t have the money to go on vacation but I was continuing to buy things I liked over what I said I loved…traveling.

In the last couple of years, I became more aware of the process of Loving, Needing, Liking and Wanting. If I don’t absolutely love something then I determine if it’s something I need, like or want. It’s helped me prioritize how I spend my time and spend my money.

I’ll repeat it again.

Love > Need > Like > Want

Why does love go before need? Because there are many things we need but if we don’t absolutely love the purchase that fills a need then we end up dissatisfied. The lack of satisfaction spurs us to make additional purchases to fill the gap between the need and the love.

For instance, you need a car and absolutely love the BMW. We could argue that a car is a need but the BMW is a want. However, if you truly love BMWs then no one should deprive you from owning one including yourself. If you truly love it, then make the necessary expense cuts, increase your income and make sacrifices in your budget to make it happen. Again, that’s if you love it. For the financially mindful you might just realize the $50,000 car, although affordable, is a like that could take you away from getting something you truly love.

Mindfulness is knowing what you love. Money mindfulness is knowing your true financial standing and prioritizing savings and purchases that improve your life.

Are you unconsciously spending on likes not loves?

Finally, join me and 30+ other people sharing their stories during a ten day virtual summit with Leisa Peterson of WealthClinic. It’s called the Art of Mindful Wealth Summit. If you feel you’re in survival mode and nothing seems to inspire you, then this is a definite must attend summit. Don’t miss out and register today. The summit starts January 26th but recordings will also be available. Register here.

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22 comments

  1. I have my share of mistakes, but have tried in the recent years to prioritize better. There are things that really matter to me and some that I don’t care about. I no longer need to ‘show off’ that I earn a decent living, I don’t need to impress anyone. I just wear the clothes I like (even if I don’t look ‘well to do’ in them), drive my car and worry about my own person and family, no longer about what others thing of me. I was able to make more progress in all areas by changing my mindset.

  2. Article Really Helpful For me Thanks For Sharing

  3. Agreed, in many ways it comes down to what is important to you. I might love going to a sushi place every Friday to relax and enjoy the food, but you might think this is wasteful spending. The 50K BMW probably can be argued against in 99% of the situations, but who knows maybe you are the 1%!

    • Even Steven, it is about knowing what is affordable given your situation but most of us don’t know what is and overstretch ourselves. We spend on all the likes never getting the chance to enjoy the loves.

  4. The sad thing is that for a lot of people family can be the problem of the ones a person feels the need to show off to/impress/be validated by (excluding parents & spouses & children). How backwards is that…

  5. For those interested in this topic, I suggest further reading on “hedonic adaptation.” We’ve all experienced this phenomenon. Once you understand and become conscious of it, mindful living naturally follows.

  6. I love your formula for evaluating each purchase. Initially I was confused about why Love would come before Need. But your explanation makes perfect sense – in fact after reading on, it’s the most logical and obvious answer of all. We’ve been focusing on Needs only for the last year. We rarely ‘splurge’ on extra items. I know I would feel guilty over it. The incredible fact is though, I don’t feel deprived. By eliminating consumerism and changing how I view our finances, I am tickled by working towards or big-picture goals. The prize of early retirement waiting for us is far superior to any of the Likes or Wants. That being said, indulging in a Love on occasion and within reason is healthy. If the opportunity presents itself, I will jump on it. But until then, my newfound money mindset is serving me well!

  7. I enjoyed your hierarchy of purchases. I agree, focus on the loves. I think the FI community is too judgmental on what people want in life. If a BMW is it, fine, work toward it and make the purchase. Or more common sacred cows might be cable (i’m not getting rid of ESPN and sports). It’s always good to be mindful when making purchases rather than out of habit.

    • Great points on mindfulness. I think we might get too focused on stopping things we enjoy or bring comfort for some ultimate goal that we haven’t fully articulated. There are some that will chastise people for spending on luxury but the argument could be had. Why save all that money when you have no clue when you could kick the bucket? On the flip side, why spend all the waking hours of the day working to afford a lifestyle that doesn’t bring true joy.

  8. Great points! I have been trying to do this more when clothing shopping to determine if I really LOVE an item or just like it. I think about what I will wear it with, when I will wear it and how often vs. the price to decide if I should be buying it. I even do this on a $3 shirt at Plato’s Closet where it can be easier to buy more because everything is so cheap. I agree this principle can be used in everything in our lives so we put that money towards things we really LOVE like experiences instead of LIKES that are material objects.

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