What Motivates Your Finances?

by Kristina on September 6, 2011 · 7 comments

finishing the raceWe all work to have money, but why do we want money? Is it because we want to be able to afford the finer things in life, or is it because we let our money define us?  The motivation behind our finances determines how we behave financially and how responsible we are with our money.  Some people are motivated by the option to buy nice things or take nice vacations; some people are motivated by the option to have more than others.  What motivates your personal finances?

My personal financial goals motivate my personal finances.  I save for my retirement because I have a retirement goal, and I save in my emergency fund in case I lose my job or have an unexpected emergency.  I also save in my Employee Stock Share Plan because my employer contributes on my behalf and it is free money for me.  I don’t save just to build up my net worth because I would rather spend that money on personal experiences.

I don’t care how much money I have in the bank because if we don’t use our money then it is worthless.  In order to have value money has to be spent.  Do you like to brag about your money?  Some people are defined by their net worth and they save every single penny in order to increase their net worth, buy why? If you don’t have goals then why are you saving? Maybe you were advised by your parents or grandparents who lived through the great depression to save money in case of another tragic economic event.  Has anyone experienced a  recent tragic economic event?

Does your class status motivate your finances? Maybe the status of Middle Class, Upper Middle Class or Upper Class is important to you.   Maybe the neighbourhood you live in, or the type of car that you drive are important to you.  The amount of income that I declare each year on my personal tax return may define my money class, but it does not motivate me.  As long as I have enough money each year to achieve my financial goals, fill my hungry belly, and have a warm (clean) place to sleep every night I am happy.

My class status is irrelevant to me, and frankly I feel that classes do more harm than good to a society. We are all people and we shouldn’t judge each other based on how much money we make.  My current personal financial goals include saving for retirement and taking a trip to Europe each year.  Next year I am going to Naples Italy.

Why do you pay off your debt every month? Maybe it’s because you don’t like to pay interest, or maybe it’s because debt burdens you.  For some people the idea of debt is unsettling.  Maybe the need to not owe money to anyone motivates your finances. I try to pay off my VISA balance every month because it helps build and maintain a good credit score.

Even though I have no intention of applying for additional credit in the near future, I feel that my credit score is a very important part of my financial life.  Unlike my net worth, the number of my individual credit score is important to me; this is because it directly affects me as an individual.  Net worth and Class Status are comparisons between us and other people, and that does not interest me.  Finances are personal, it is not a competition.

What motivates your finances? In other words why do you get up in the morning and go to work?

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Photo by LuluLemon



{ 7 comments… read them below or add one }

1 jon_snow September 6, 2011 at 6:51 pm

Early retirement at or before 45 is my financial holy grail.

2 Kristina September 7, 2011 at 6:30 pm

@ jon_snow – That’s Great. What are your plans for retirement?

3 jon_snow September 7, 2011 at 7:59 pm

Too many things to list… my hobbies and interests are so varied and numerous that I simply can’t dedicate much time to them while I’m working… 3 weeks holidays per year doesn’t allow it. Many of my hobbies require a certain level of fitness, so retiring while I’m still physically spry is important to me. My wife and I have decided to sacrifice certain things now (big house, fancy cars, etc) so that we can do whatever the heck we want before we reach 45…. there are times we are envious our friends who are “living it up”, but many have confided in us that they are up to their eyeballs in debt…. this is not the path we choose.

4 Ann September 8, 2011 at 3:32 pm

Hi Kristina,
My motivation is peace and available options. I’m with you, the exact amount of money is unimportant – it’s buying power is all important. Good credit (as it was taught by my grandparents) is a virtue!! And, that all powerful credit score buys us more options. You totally hit the nail on the head about material things and people that the amount of money is their thrill. I just want to be able to have a sense of peace and safety (from those tough economic times that we haven’t seen yet!). Thanks for sharing.

5 Kristina September 8, 2011 at 7:49 pm

Thanks Ann. It is definitely a big peace of mind.

6 kody @ financial money tips September 10, 2011 at 9:06 pm

love this article :) I have been thinking about this for some time now. Why do i want money? The reason i want money is because i am really motivated about starting a family in the next 5 years. Money gives me peace of mind because of that fact. I need to not only save for retirement but also provide for my family. And ofcourse i want to travel the world also :)

7 Kristina September 11, 2011 at 7:50 pm

@ Kody I share the travel the world aspiration with you. I hope to retire in Europe, hopefully Spain; but that won’t be for many years to come. Now I am saving money for retirement and to have choices. I don’t want to live without!

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