I usually introduce myself to people as a business coach. Truly, I work with people who want to become more successful in business and their career.
However, for every client I work with, I ask them to be as open as possible about their personal finances. I can get resistance on this from more than a few, after all I am NOT a financial planner. Nor am I an accountant or financial coach.
However, along with the personality assessments, a person’s behavior with money are very indicative of what motivates them, and what their weaknesses are. So, we talk money, always.
As most of my clients have a financial goal tied to their desires for success, everything has to start with how they are treating the money they currently have. Income and expenses tell a story of priorities. They are also the key to understanding where you might be failing to reach your potential.
For example, a typical complaint is that income is too low. Well, my question is what is it that you need to survive each month? You’d be surprised that most people couldn’t provide a number, even a rough estimate, of what their expenses are. So, my question of course is “Are you for real?!?”
In other words, it’s time to focus in on everything you spend. Write it down. What patterns do you notice? What surprises you as far as the amount you might be spending on a category? I will tell you that this information is so revealing. Whether it’s clothing, eating out, entertainment or other distractions, people who complain that they don’t have enough to save in order to fund their dream house or retirement at the age of 50, see that they spent it on things that really don’t matter.
One client I worked with had a huge vehicle he drove around in. Brand new. But he was struggling in his business, and I asked him why not get rid of the SUV to help with his income issues. He felt that the vehicle was a symbol of success to anyone he was doing business with, or might do business with him.
The problem here is that he’s placing his faith — and a lot of money — into a vehicle rather than investing in his own personal development. As a coach, I need to unpack why he chose to do this. Most often, it’s a matter of what values he has learned, and whether these are values that can be sustained.
It’s not easy work, and it’s usually uncomfortable to peel back the layers of your values and motivations. However, this is just one of many classic cases where people are chasing the result or their version of success, when they should be chasing the problems that keep us from success. It’s the ultimate paradox of seeking happiness and being miserable. Instead, in chasing and facing the problems in the darker corners of our lives, we utimately find joy. And, lo and behold! — they find themselves closer to success than they could have imagined.
So, yes we begin with money. Most often it is a point of contention in our relationships, especially the one we have with ourselves. In viewing a person’s budget and making choices that serve goals that affirm the right values (solving problems and not chasing ideals), it’s amazing how much more confident people become. They feel freer and more empowered, especially as they see their debt managed and their savings increased.
I will give you another example. Everyone wants to make a boatload of money. That’s the wish. What they need to want and understand is the pain of putting in extra hours every day to make that extra sale or land that special client. Likewise, people who are fit made a decision to embrace the struggle of going to the gym, or getting up an hour early every day to run, or choose a salad instead of that bowl of pasta. A budget therefore is what helps you embrace the struggle because you’ve placed your values in the right place. Your goal isn’t a million dollars, it’s a day to day commitment to be disciplined in money decisions. This generally leads to making other disciplined decisions, perhaps in eating or drinking or relationships.
The beauty of the budget is that the goals you set and habits you end up developing ultimately bleed into other areas of your life. It’s inevitable, but only if you’re willing to stop chasing the wrong values.