How emotional awareness and management helped me save my finances?
Everything is emotions. That relationship. That choice. That decision. That life goal. That waking up early. And honestly, our finances too.
We are emotional beings and we have an emotional response towards everything.
Like I always say there are just two things you can do with your money. Make it or spend it.
So you know every choice you make is directly linked to your emotions. Here are two examples for your help.
Example One: Making Money.
Idea: You can make money through earning, then saving, then investing and so on and so forth. But why you earn? Why you save? You need it. Then why do you strive for more. Because more money means less money issues. Money issues would not have been an issue if emotions never existed in the real world. Say you are in debt. Debt itself is not a problem. The feeling of contant stress to return the money is the problem. The feeling of freedom after repayment is what you are chasing now. You are making money for that feeling of freedom. You are motivated to make more because you are not happy with the emotions of contant stress or fear. So making money is an emotional response. If you inherit all this wealth you are making, don’t care about what society would say, don’t care about impressing anyone, don’t even care about the comforts more than what you need, would you still be motivated to make more?
Illustration: Jerry is from India. Has a middle class social circle and lives alone. Jerry earns 50,000 INR per month. This is more than enough for Jerry considering his circle and living expenses. But Jerry wants to go on a world tour. So he decides to raise his income to save more.
Note: Jerry took a financial decision to make more money because he wanted to fulfill a desire. This desire technically ( and biologically) ignited an emotional response in him. So raising his income and saving more is innately an emotional decision.
Example two: Spending money.
I am a minimalist and yet I am totally in favour of spending money. Spending is also an emotional response. You don’t spend money on just everything. You spend it on things you need, you like, you enjoy, you want, or you want to impress someone with. Needing, liking, enjoyment, wanting, impressing, it is all an emotional response.
Illustration: Jerry visits Japan. Jerry is not a fan of shopping but he has a sister who asked him to get something for her as a gift while he returns. How will Jerry make a decision. He can literally buy anything as a gift. Like any normal person he narrows down his choices this way. He is in Japan so he must buy something that represents Japan. He is buying for his sister so it must be something for a woman. He knows his sister loves fashion. So depending on her choices he decides to buy a Kimono. He spends his money on a Kimono.
Note: Spending money on Kimono is a financial decision. But it was triggered by an emotional response. What on earth is Jerry going to do with a kimono or how many times his sister is going to use that kimono living in india? His emotions of wanting to make his sister happy lead him to the decision. Thus, it is innately an emotional decision.
If you struggle making or saving finances, keep a sense check. What emotions are convincing me to buy this commodity? Are these emotions already processed? Is finances the only resolve to these emotions?
This awareness saved me big time from doing unnecessary expenditure. I wanted to buy a personal car. I saved some amount for it and was ready to take a car loan. Before making the financial decision, I took a step back and did an emotional sense check. I figured out that I wanted a personal car because all my friends have one. Not because I actually need one. I can use the subway or metro to commute and I have no problem with it. I was doing this as an emotional response because whenever I see my friends with their own car, I feel I lack something. I decided not to buy it once I resolved my emotion of unnecessary comparison and this saved me upcoming car maintaining expenses, car loan EMIs and more emotional mess of trying to have what I don’t even need in the first place.
Hope this helped.
