Prioritize Your Spending for Better Financial Success

Everyone's definition of financial success is different. Your goal should be to foster your own version of financial success, and not worry so much about whether or not you are living up to someone's expectations for your finances. Find a belief in yourself and your own financial decisions. As you look for your own version of financial success, you will need to prioritize your spending according to what you think is more important.　

Spending Based on Your Values 

When you truly believe in what you spend money on, you are more likely to stick with your spending plan, and you will find it easier to build the life you want for yourself. This means that you should spend based on your personal values. In order to determine your values, you need to take an honest look at yourself. Here are some things to consider as you evaluate your spending values:

• What do you think it's important to spend money on?

• How much time do you have to reach your goals?

• Does your spending help you reach your lifestyle objectives?

Finally, look at the big picture. What are your most important lifestyle objectives? Do you want to be able travel? Would you like to buy a new home? Are you planning to retire in the next 10 years? Figure out what kind of life you want to live, and then identify which spending behaviors are helping and hindering your efforts to reach your goals. Another consideration is time frame. If it's important that you become debt free as soon as possible, putting aside a huge portion of your income for retirement, or making a large charitable contribution, might not be the most important thing for your finances right now. Look at your spending preferences. Figure out what you think is most important when you spend money. Do you like experiences or things? Is it important to you to give to charity? Do you want to have a secure financial future? Contemplate what is most important to you when you spend money.  

Your spending should focus on the items that reflect your values, who you are, and what you really want out of life. As you plan your spending for the coming year, prioritize based on your own values - not someone else's.　

Spend on the Most Important Items First 

As you arrange your finances, make sure that you spend on the most important items in your life first. List out your expenses. Include the items that are most important to you, and the items that you are required to buy. Groceries, bills, mortgage payments, retirement account contributions, emergency fund money, charitable contributions, eating out fund, and saving up for that vacation, and paying off debt should all be listed.  

Also, look at some of your past spending. Write down what you have been spending on - even if it's not important to you. This exercise will help you identify the ways you have been using your money on items that are of little importance to you. My guess is that you will be surprised at what you discover. You have probably been wasting a significant amount of money on items of little import to you, and that don't help you accomplish your financial and life objectives. 

Now that you have an idea of what your expenses are, rank them in importance. Don't rank them according to what you think will impress others, or what you think the "right" answer is. Honestly rank them in importance to your life, and what you hope to accomplish. When creating your budget or spending plan, make sure that you pay for the most important items first. The less important items can be dropped off the list - and remain unfunded if you don't have the money for them. 

When you spend according your personal values and objectives, you are more likely to feel better about your finances. After all, you are spending on what you want first! The less important items aren't funded, but it doesn't feel like as big of a loss. You will feel empowered to continue working toward your goals, and build your finances on a firm foundation. 

By creating a spending plan based around your values and priorities, you will be able to better follow your own path toward financial success.

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Miranda Marquit

Miranda is a freelance writer and professional blogger, specializing in topics related to personal finance and business. Her work has appeared in, and been linked to from, a variety of publications, online and offline. Miranda blogs for a number of web sites, and has her own personal finance blog,