What do money and values have in common? They determine how you handle your finances. It affects your financial goals, how you choose to invest, and the legacy you leave behind.
Therefore, what you value will determine how you handle your finances along with a financial legacy that will last long after you have gone. The first step is to start. Here are eight money values that you can start using today, to help create a lasting legacy tomorrow.
Understand your money values
Your money values stem from your money personality, which can affect how you see and use money. It can be used to make smart money moves, but it could also lead to bad financial decisions. Understanding your strengths and weaknesses when it comes to financial planning can help you make better decisions. Speaking to a financial advisor can also make the process less daunting.
Have a plan for your money
Creating a financial legacy that can benefit you and your loved ones requires planning. Did you know that 30% of generational wealth is due to families having a mission statement and a plan on how to accomplish it? Setting a plan on what you would like your finances to achieve and checking if it aligns with your values makes it easier to maintain in the long run.
Set goals that offer financial stability
Always know your why. When it comes to financial planning or creating a legacy, your why will help you cut back on things that do not bring you closer to your goals. Becoming financial stable is at the core of anyone who is looking to create a financial legacy that outlasts them. Remember to assess if your current financial habits are increasing your cash flow, protecting you financially and are not a strain to keep up with.
Have short and long-term goals
Having solid money values that benefit you and your loved ones is all about learning and unlearning. While your eyes may be set on big financial goals, make sure not to neglect your short term goals. Short term goals could be in the form of having a budget and policies that protect your income and assets. Long term goals include life insurance, and cutting back on debt to help build good financial habits.
Involve your family in your vision
Speaking about finances with your family can be something most people avoid. However, starting conversations around money and how it should be used can break bad money habits that thrive in environments where finances are not discussed. Set a plan which you would love you and your family to work towards, especially if you are a breadwinner. Be honest with yourself and your loved ones in terms of what you can afford to do and how you can best pool resources to protect your family.
Learning the basics of financial literacy, even if you are a beginner, can help you avoid making decisions that could end up costing you. Financial literacy is a handy financial tool that can help you and your loved ones deal with the various life stages, even if it means dealing with a financial emergency.
The baby steps of investment
Making the shift from saving to investing is vital. Knowing how to get your finances to work for you instead of the other way around means knowing how to make investments that will align with your goals. Start small. Always consider how much risk you are willing to take on and gradually build your portfolio. A golden rule that investors use is to always diversify your investments to achieve the best growth for your funds.
No legacy was built overnight. It will take work and constantly adapting to get the most out of your finances. Always keep the long-term goal in mind and check with your financial advisor or portfolio manager on how to best utilize your finances for the better.