EPISODE 28: HOW TO SPEND AND SAVE USING YOUR CORE VALUES WITH JEN SMITH
Live Date: November 29, 2021
Show Description: In today’s episode, Heather sits down with personal finance expert Jen Smith, founder of Modern Frugality and host of the Frugal Friends podcast, to talk all things personal finance, setting yourself up for the future and how to use your values to inform your spending. Jen also shares some of her favorite resources with you. You’ll want to stick around for her investing and saving tips!
This Episode Will Teach You:
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The biggest mistakes women make as it relates to their finances
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How to apply habit psychology to your spending
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What value-spending is and how it can help you budget
Biggest Takeaways:
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Heather and Jen talk about the money knowledge they wished they had and what they can be teaching their children. The consensus? Know your limits so you can enjoy what you have. Through honesty and boundary setting, children can learn solid money habits at an early age.
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Jen explains the concept of value-based spending and how essential it is to establish your own personal core values before building a budget. You can create your core values by deciding what is important to you; not your partner, not your children, but you, and then look at your spending habits and see if they match up. Sometimes areas of lack from your childhood can influence your core values in adulthood, so knowing what informs your values helps your spending habits.
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As Heather fires off her rapid fire questions, Jen shares her number one piece of advice: invest early. No matter the amount, invest early and monthly to set yourself up for financial success in the long run.
About the Guest: Jen Smith is a personal finance writer and co-host of the Frugal Friends Podcast. She and her husband paid off $78K of debt in two years and now she helps others control their spending in ways that work for them.
Quotables:
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“I needed to control my spending, which was hard because I always already thought I was frugal. But in reality, now looking back and knowing more about frugality, I was really just cheap. I was buying generic brands because I thought I was broke. And then I would go Starbucks every other day, too. So there was a total disconnect. And that was really what started me on this journey of embracing frugality and falling in love with it.” – Jen Smith, 4:
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“I wish that I had known this sooner – a budget is not the solution to all of your problems. I really thought that if I made a budget, then I could pay off my debt. But the problem was is that I would make a budget and it would look perfect. And then it was impossible to stick to.” – Jen Smith, 8:17
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“I’m a huge proponent for core values, knowing your values and budgeting based on those, because then your budget becomes something that incorporates all. It connects all of your expenses and your income back to your core values, so that you want to spend money on the things that connect to your core values.” – Jen Smith, 9:39
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“I think the most important thing I’m trying to get across to my son is that there are limits. If we can teach limits on things that are not money, then when it gets to money, they better understand, Hey, there’s a limit.” – Jen Smith, 12:23
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“When we take them through the core values they have a really hard time answering questions about themselves because they’re thinking about their kids, about their partner, about their work, all that stuff. So I think that’s like the first thing is you actually have to sit down and take the time to figure out ‘what do I enjoy spending my time on, what do I enjoy spending my money on?” – Jen Smith, 15:40
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“So once you narrow your core values down to your top three to four, then you want to connect all of your expenses back to those three to three to four core values, and ideally in a perfect world, which we don’t live in, but in a perfect world, every single one of your expenses would connect back to at least one of your core values.” – Jen Smith, 17:43
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“That makes sense on the spending side and on the budgeting side, you take those values and then you take the expenses and you’re drawing them to each other and eliminating the ones that you can’t connect. And then the ones that you do, you’re prioritizing that in your expenses.” – Heather Adams, 19:28
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“We’re always going to have those days where we’re very tired, we are very busy or maybe we’re celebrating something. Things are always going to come up that are unplanned, negative and positive. So you can better make better decisions in your spending when you have this values-based spending mindset and you can more quickly identify what expenses fall into your core values.” – Jen Smith, 21:36
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“If you focus on your finances, you can have more of the things that you really care about. I think we could look at money differently. In our generation, there is more guilt and shame built up around money for both genders, but I think maybe even more for women because we feel those things more deeply.” – Jen Smith, 28:34
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“Start [investing] early and often. If you don’t have a super huge income, then the best thing you can do on an average income is to just start now and and invest every month. That’s it, no matter what it is, just commit to investing something every month.” – Jen Smith, 33:13
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“Values-based spending is going to help you decide whether a purchase is in your values or not. And hopefully the more you do that, the better you get at discerning those things. You’re not going to be great at it when you start and don’t expect yourself to be.” – Jen Smith, 35:19
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“The only person who cares about your finances is you. So, be aware of that and know that you don’t have to lose friends.” – Jen Smith, 48:30
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“You don’t want to be the only one fighting for the relationship either. If you’re missing out on happy hours and asking people to come to your house to get together instead is going to cause you to lose relationships, then those may not be the right ones to have to begin with.” – Heather Adams, 49:15
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