Category: Blog

Have you ever wondered why some people seem to effortlessly manage their finances while others struggle, despite having similar incomes or financial knowledge? The answer might lie not in their bank accounts, but in their hearts and minds.

While financial literacy is undoubtedly important, there’s another crucial factor at play that often goes overlooked: emotional intelligence (EI). As Darwin Nelson and Gary Low astutely observed in 2011, “Emotional intelligence is the single most important influencing variable in personal achievement, career success, leadership, and life satisfaction.”

But what does emotional intelligence have to do with money, you might ask? Well, as it turns out, everything.

Think about the last time you made a significant financial decision. Maybe it was a big purchase, an investment, or even deciding whether to splurge on a night out. What emotions were swirling around in your mind? Excitement? Fear? Guilt? Pride? Our financial choices are often driven by these underlying emotions, whether we realize it or not.

Emotional intelligence is about recognising, understanding, and managing these emotions effectively. When it comes to money, this skill can be transformative. It’s the difference between impulse buying to soothe stress and recognising that stress, then finding healthier ways to cope. It’s the ability to stay calm and rational during market volatility rather than panic-selling at the worst possible moment.

But the impact of emotional intelligence on our financial lives goes far beyond individual decisions. It shapes our entire relationship with money and, by extension, our sense of personal achievement and life satisfaction.

Consider this: When we make financial choices aligned with our deepest values and long-term goals, we’re not just managing money – we’re crafting a life that feels genuinely fulfilling. This alignment requires a high degree of self-awareness and self-management, both key components of emotional intelligence.

Moreover, the link between emotional intelligence and leadership isn’t limited to the corporate world. Being financially savvy with high EI makes you a leader in your own life and often within your family or community. You become the person others turn to for sound financial advice, not just because you understand numbers, but because you understand people.

So, how can we cultivate this powerful combination of financial literacy and emotional intelligence? Here are a few strategies to consider:

1. Practice mindfulness: Before making financial decisions, pause and check in with your emotions. Are you acting out of fear, greed, or authentic desire?
2. Identify your money scripts: We all have underlying beliefs about money, often formed in childhood. Recognising these can help you understand your financial behaviours better.
3. Set emotionally-connected goals: Instead of just saying “I want to save more,” dig deeper. What emotions are driving that desire? Security? Freedom? Understanding the emotional roots of your financial goals can help you stay motivated.
4. Develop empathy: Understanding others’ perspectives can be invaluable in financial negotiations, whether it’s asking for a raise or discussing budget with a partner.
5. Celebrate progress, not perfection: Acknowledge your financial wins, no matter how small. This positive reinforcement can build confidence and motivation.

Remember, the journey to financial well-being is as much about mastering your emotions as it is about mastering your money. By developing your emotional intelligence alongside your financial literacy, you’re not just working towards a healthier bank balance – you’re paving the way for greater personal achievement, stronger leadership skills, and a more satisfying life overall.

So, the next time you sit down to review your finances, don’t just look at the numbers. Take a moment to check in with your heart as well. After all, true wealth isn’t just about what’s in your wallet – it’s about creating a life rich in purpose, connection, and fulfilment. And that, is where emotional intelligence truly shines.

We often think that financial peace or calm is the ultimate goal when it comes to managing our money. We hear phrases like “financial peace of mind” or “calming the storm of debt” and we think, “Yes, that’s what I want. I just want everything to be calm.”

And while there’s nothing wrong with seeking calm, it’s not the point. 

The real goal? Connection.

Connection with our money, our values, our goals—and yes, with the people who matter to us. Because, in truth, calm is temporary. Life isn’t static, and neither is our financial journey. There will always be waves: market shifts, unexpected expenses, changes in personal circumstances. 

Calm comes and goes, but connection remains.

This idea of connection is vital, especially when we consider how we feel, behave, and talk about money. If calm is all we seek, we might be misaligning our aim. 

Here’s why connection is the deeper goal:

1. Feelings: Money and our emotions are intertwined

Think of how we feel about money on a daily basis. Sometimes, it’s fear. Sometimes, it’s joy. Other times, it’s anxiety or excitement. While financial calm might help to manage our emotional highs and lows, connection asks a different question: What are these feelings really telling me?

Feeling connected to your money means understanding the emotions behind your financial decisions. When you buy something, what are you really purchasing? When you save, in what are you truly investing? Are you securing safety, or are you postponing a dream? 

Emotions like fear, joy, and even guilt are signals about our deeper relationship with money. If we can get curious about them, instead of just calming them down, we get closer to understanding what really drives us. Connection to our feelings helps us make better, more aligned financial decisions.

2. Behaviors: Money habits reflect who we are

Our behaviour with money often reflects more than just a desire for financial calm. It’s about the story we tell ourselves about who we are, and how we move through the world. 

When we aim to be connected to our money, rather than just keeping it stable, we are asking deeper questions like: What do I really want from my life? 

This level of introspection guides not just the saving and spending decisions but also how we plan for the future, give to others, and invest in experiences.

It’s less about doing what will “calm” you and more about doing what will “connect” you to your purpose, your values, and the people in your life.

3. Conversations: More than just calming money talk

Many of us avoid talking about money because it disrupts the calm in our relationships. But avoidance often leads to disconnection. Instead, we need to have connected conversations about money, not just ones aimed at preserving peace.

Talking about money with a spouse, partner, or even a trusted advisor shouldn’t be about avoiding discomfort. It should be about connecting around shared goals, being honest about fears, and working together to build a financial future that makes sense for everyone involved.

Real conversations about money build trust, transparency, and deeper bonds, even if they’re uncomfortable at first. They help us stay connected with each other, rather than just trying to calm things down and sweep money worries under the rug.

Calm is not the point. Sure, we all want moments of financial peace. But in a world where things are constantly changing, aiming for calm might be a short-term win. Long-term success lies in connection—being connected to what matters most when it comes to money: your values, your emotions, your goals, and your relationships.

When you stop focusing solely on keeping the financial waters still and start working on staying connected, you’ll find that even when the waves come, you’re anchored to something deeper. And that’s where real financial resilience comes from—not from the calm, but from the strength of the connections you’ve built.

So, the next time you think about your financial life, remember: connection is the point, and it will carry you through even when the calm is nowhere to be found.

In her thought-provoking book “The Year of Less,” Cait Flanders shares a powerful insight: “Every time you make a purchase, you’re voting with your dollar for the kind of world you want to live in.” This simple yet profound statement invites us to reconsider our relationship with consumption and its impact on our financial well-being.

Mindful consumption isn’t just about spending less; it’s about spending with intention. It’s about understanding that each purchase we make is a choice that shapes not only our personal finances but also the world around us. When we buy something, we’re not just exchanging money for goods or services; we’re making a statement about what we value and what kind of future we want to create.

Consider your last few purchases. Were they driven by genuine need or desire? Did they align with your values and long-term goals? Or were they impulse buys, motivated by fleeting emotions or external pressures? By pausing to reflect on these questions, we begin to unravel the complex web of motivations behind our spending habits.

Often, we find ourselves buying things to fill emotional voids, impress others, or simply because clever marketing has convinced us we need them. But when we step back and examine these motivations, we often unveil that many of our purchases don’t truly align with what matters most to us. They may provide a momentary thrill, but they rarely contribute to lasting happiness or financial security.

Embracing mindful consumption means becoming more aware of these patterns and making conscious choices to break them. It means taking a moment before each purchase to ask ourselves: Does this align with my values? Will it contribute to the kind of life and world I want to create? Is this the best use of my financial resources?

This shift in perspective can be transformative. When we start viewing our purchases as “votes” for the future we want, we become more discerning consumers. We might choose to support local businesses over large corporations, opt for eco-friendly products, or invest in experiences that enrich our lives rather than accumulate more stuff.

Moreover, mindful consumption often leads to improved financial health. By focusing our spending on what truly matters to us, we naturally cut back on unnecessary expenses. This frees up resources for saving, investing, and pursuing our long-term financial goals. It’s not about deprivation; it’s about aligning our spending with our values and priorities.

Cait Flanders’ year-long shopping ban, which she documents in her book, is an extreme example of mindful consumption. While most of us may not choose to go that far, her experience offers valuable lessons. She found that by stepping back from mindless consumption, she gained clarity about what truly mattered to her. She discovered that many of her previous purchases were driven by habit or emotional needs rather than genuine desire or necessity.

As we navigate our own financial journeys, we can take inspiration from Flanders’ experience. We can start small, perhaps by implementing a 24-hour rule before making non-essential purchases, or by keeping a spending journal to track not just what we buy, but why we buy it. These simple practices can help us become more aware of our consumption habits and make more intentional choices.

Remember, every dollar you spend is a vote for the kind of world you want to live in. By embracing mindful consumption, you’re not just improving your financial health; you’re also contributing to a more conscious, sustainable economy. You’re creating a life that’s rich not in possessions, but in meaning and purpose.

What if you found out that your current financial plan might be working against you, not for you? That despite all your careful budgeting and saving, you’re missing a crucial element that could make or break your financial well-being? 

It might be time to talk about values-based financial planning – the missing link between your money and your happiness.

Life is a precious gift, and it’s too short to spend our time and resources on things that don’t truly matter to us. As Michelle Obama wisely said, “I have learned that as long as I hold fast to my beliefs and values – and follow my own moral compass – then the only expectations I need to live up to are my own.” This philosophy applies just as much to our financial lives as it does to our personal ones.

When making financial decisions, we often ask ourselves practical questions like “Can I afford this?” or “Will this be a good investment?” While these are important considerations, there’s a more fundamental question we should be asking first: “Does this align with my values?”

Values-based financial planning is about creating a financial strategy that not only helps you reach your monetary goals but also supports and enhances the life you want to live. It’s about ensuring that every dollar you earn, spend, save, or invest, is in harmony with what matters most to you.

So, how do we put this into practice? Here are a few steps to get you started:

1. Identify Your Core Values: 

Take some time to reflect on what truly matters to you. Is it family, community, personal growth, environmental sustainability, or something else? There are no right or wrong answers – your values are uniquely yours.

2. Align Your Financial Goals with Your Values: 

Once you’ve identified your core values, look at your financial goals through this lens. Does your current financial plan support these values? If not, what changes can you make?

3. Make Values-Based Decisions: 

When faced with financial choices, big or small, ask yourself, “Which of my values does this align with?” If the answer is none, it might be time to reconsider.

4. Create a Values-Based Budget: 

Allocate your resources in a way that reflects your priorities. If family is a core value, perhaps you’ll allocate more for family vacations or education funds. If environmental sustainability is important to you, you might budget for energy-efficient home improvements or choose eco-friendly investment options.

5. Invest with Purpose: 

Look for investment opportunities that align with your values. This could mean choosing socially responsible investment funds or supporting businesses that share your principles.

Remember, the goal isn’t to restrict your choices, but to free yourself to say “heck, yeah!” to the things that truly matter to you. By aligning your finances with your values, you’re not just managing money – you’re crafting a life that feels authentic and fulfilling.

Values-based financial planning isn’t always easy. It may require some tough choices and trade-offs. But the reward is a financial life that feels meaningful and purposeful, rather than just a series of transactions and accumulations.

In the end, financial planning isn’t only about reaching a certain number in your bank account. It’s about creating a life that reflects who you are and what you stand for. When your financial decisions are in harmony with your values, you’re not just building wealth – you’re building a life rich in purpose and satisfaction.

So, the next time you’re faced with a financial decision, big or small, take a moment to consult your inner compass. Ask yourself not just “Can I afford this?” but “Does this fit with who I am and who I want to be?” Your values are your most reliable guide to a truly wealthy life – in all senses of the word.

Is money linked to our ego? It’s a question that invites us to reflect on the deeper motivations behind our financial decisions. Morgan Housel, in his thought-provoking way, suggests that “savings is the gap between your income and your ego.” 

This statement can be confronting, especially because it challenges us to consider the extent to which our financial behaviours are driven by a desire to maintain or enhance our sense of self-worth. While Housel’s observation holds some truth, it’s important to recognise that the relationship between money, ego, and personal fulfilment is far more nuanced than it first appears.

At first glance, the idea of adopting a low-ego, high-humility approach to wealth-building might seem like the most logical path. The reasoning is simple: by curbing spending driven by ego and instead focusing on saving and investing, we can accelerate our journey toward financial independence. This approach, however, can sometimes feel overly simplistic. It suggests that ego is inherently detrimental to financial success and overlooks the complex ways in which our values, purpose, and sense of fulfilment intersect with our spending choices.

For many, spending isn’t merely about satisfying an inflated sense of self-worth. It’s deeply intertwined with values, purpose, and the pursuit of personal fulfilment. Consider, for example, someone who chooses to invest in high-quality experiences or products—not to showcase their wealth, but because these choices align with their core values or bring them a deep sense of joy and meaning. In such cases, spending is not just about ego; it’s about living in alignment with what truly matters to them.

This brings us to the essential concept of balance. Financial independence isn’t just about cutting expenses to the bone or maximising wealth accumulation. It’s about ensuring that our financial decisions reflect both our personal values and long-term goals. When our spending is aligned with what we value most, money becomes more than just a means to an end; it becomes a tool that helps us lead a life filled with purpose and fulfilment. It’s not about living frugally for the sake of frugality, but about making intentional choices that serve our deeper aspirations.

This balance is critical because it acknowledges that wealth and fulfilment are not mutually exclusive. It’s possible to spend on things that matter to us—whether it’s on quality, experiences, or passions—without compromising our long-term financial goals. This requires a strategic financial plan that accounts for these intentional choices, allowing us to enjoy the fruits of our labour while still securing our financial future.

Understanding the link between money and ego is part of a larger journey toward self-awareness and intentional living. It invites us to examine where ego may be driving our financial decisions and where our spending truly reflects what we value most. By doing this inner work, we can create a financial plan that doesn’t just aim for wealth accumulation but also for a life that feels rich in purpose and fulfilment. In this way, money serves its highest purpose—supporting a well-lived life with balance, intention, and clarity.