Why Core Values Can Liberate Your Financial Decision-Making

Every Wednesday morning our team gets together, to learn, grow, and become smarter with one another. Last week, we shared experiences and strategies that “worked” to help clients understand what tools they may best use to achieve their financial goals.

Sometimes we inspire. Most often we optimize. And always, we listen. But there is the unique rub; optimization does not imply everyone should be swathed with the same strategic brush. We need to “understand” why someone may act in a manner that does not benefit their financial goals. And to be honest, sometimes that can be OK.

Ever employ the wrong tool for the job? I’ve done it. I would like to think most of us have. The benefit is that we can learn from it and make a different decision in the future. Retail therapy is one example that comes to mind; the need to buy something, just to realize the expected satisfaction quickly fades into regret and the void persists.

?“Like nailing gold-plated tacks into a plastic bag, just to stop a leak”; an expensive tool, to solve a problem, perhaps better remedied by a cheaper, more effective wad of chewing gum.

When it comes to financial planning, numbers, strategies, and forecasts often take center stage. But beneath the surface lies a crucial element that is often overlooked: your core values. These are the deeply held beliefs and principles that guide your life decisions, and they are essential to shaping a truly meaningful financial plan. Taking the time to identify and connect with your core values can liberate your financial decision-making, empowering you to make more intentional choices that align with your long-term goals and vision for the future.

What Are Core Values?

Core values are the foundational beliefs that reflect what matters most to you in life. They influence your priorities, shape your relationships, and drive your behavior, often without you even realizing it. Values like family, freedom, security, legacy, growth, and contribution could be central to how you view your world. Yet, many people go through life without ever articulating or deeply exploring these values.

It can be fun to sit back and think about our own. In asking our clients over the years, I've found that this exercise is often new and enlightening. Give it a try, before reading further!

In financial planning, failing to recognize these values can lead to decisions that feel misaligned with your true self, creating tension and dissatisfaction. When your financial choices reflect your core values, however, you unlock a sense of purpose and fulfillment, leading to greater peace of mind and more meaningful outcomes.

How Core Values Impact Financial Decisions

Every financial decision—whether it's saving for retirement, purchasing a home, or choosing investments—carries deeper emotional and psychological weight. Consider a few examples:

Freedom vs. Security: Someone who values freedom above all might prioritize experiences, travel, or entrepreneurship, seeking flexible financial strategies that support an adventurous lifestyle. Conversely, someone who values security may focus on conservative investments and building a strong financial safety net.

Legacy vs. Enjoyment: If leaving a legacy for future generations is a priority, you might choose estate planning strategies, insurance products, or charitable giving vehicles. On the other hand, if you value enjoying the present moment, you may prioritize spending on personal experiences or allocating more of your income toward leisure activities.

By identifying and prioritizing your values, you can make financial decisions that reflect what truly matters to you, reducing stress and conflict over money. This clarity helps you avoid decisions driven solely by short-term pressures or societal expectations and instead empowers you to make choices that serve your long-term goals and vision for the future. You're allowed to be unique; you're allowed to be you.

The Connection Between Core Values and Goals-Based Financial Planning

Goals-based financial planning is about much more than accumulating wealth. It’s about aligning your financial strategy with the life you want to live. Core values play an integral role in this process because they serve as the compass that guides your financial goals.

When you take the time to understand your values, you can create financial goals that resonate with your deeper sense of purpose. For example:

If family is your core value, your financial plan might prioritize education savings for your children, purchasing a family home, or creating a trust for future generations.

If growth and achievement are central values, you might focus on entrepreneurial ventures, professional development, or creating a diversified investment portfolio to build wealth over time.

If contribution and giving back matter most, your plan might incorporate philanthropy, social impact investments, or volunteering your financial expertise for charitable causes.

In each case, goals are not abstract benchmarks—they are meaningful, intentional objectives that reflect your most cherished values. This approach not only motivates you to stay committed to your financial plan, but it also enhances your overall sense of well-being and satisfaction as you work toward goals that truly matter.

Liberating Your Financial Decision-Making

Financial decision-making becomes far more empowering when you make choices based on your values, rather than external pressures. Here are a few ways that identifying your core values can liberate your financial decision-making:

Clarity and Confidence: Understanding your values provides clarity about what’s important. Instead of feeling pulled in different directions by competing priorities, you’ll know exactly where to focus your resources. With this clarity, you can make financial decisions with confidence, knowing they are aligned with your vision for the future.

Reducing Stress and Conflict: Financial decisions often come with stress, especially when they conflict with your values or when you’re unsure of your priorities. By grounding your decisions in your values, you can reduce internal conflict and external pressures. You’ll feel more at peace with your choices, knowing they are right for you.

Increased Motivation: When your financial goals align with your values, you are more likely to stay motivated and committed to achieving them. These goals become more than just financial targets—they represent the life you want to live. This intrinsic motivation makes it easier to stay disciplined, even when faced with challenges or setbacks.

Long-Term Fulfillment: The ultimate goal of financial planning is not just financial security, but also personal fulfillment. By connecting your financial decisions with your values, you’re working toward a life that brings you joy, purpose, and peace of mind. This approach leads to long-term fulfillment, not just financial success. Isn't that what "it" should be all about?

Practical Steps to Align Your Financial Plan with Your Core Values

Reflect on Your Values: Start by taking some time to reflect on what truly matters to you. Consider your past financial decisions and how they made you feel—were they aligned with your values or driven by external factors? Write down your core values and think about how they influence your goals.

Discuss Values with Your Financial Planner: Share your core values with your financial planner so they can help you build a financial plan that aligns with what matters most to you. A good financial planner will understand the importance of aligning financial strategies with personal values and will help you make choices that reflect your priorities.

Set Goals Based on Your Values: Use your values as a foundation for setting financial goals. Whether you’re saving for a major life event, investing for the future, or creating a legacy, ensure your goals are meaningful and rooted in your core values.

Regularly Revisit Your Values and Goals: As life evolves, your values and goals may shift. It’s important to regularly revisit your values and ensure your financial plan remains aligned with them. This will help you stay on track and make necessary adjustments as your circumstances change.

Conclusion

When you take the time to identify and connect with your deep-rooted core values, you create a powerful foundation for your financial decision-making. Your financial plan becomes more than a tool for managing money—it becomes a roadmap for living a life that’s aligned with your values and fulfilling your long-term vision. By grounding your financial decisions in what matters most to you, you liberate yourself from external pressures and empower yourself to achieve true financial and personal success.

I hope you found this insightful, and perhaps even a little bit fun. Now I get to ask once again, "What are you planning for"?