10 Commandments of Financial Happiness

Financial happiness

In You Don’t Have to be Rich, author Jean Chatzky says there’s a strong relationship between feeling in control of your finances and feeling happy about your finances.  And, she says there’s a powerful relationship between feeling in control of your finances and feeling happy with your life:

Control over your finances plays a greater role in determining your life’s happiness than being in control of your job, your health, your friendships, your weight. Clearly it’s worth striving for.

So how can you gain greater control over your finances, and greater happiness in your life?  Chatzky offers The 10 Commandments of Financial Happiness.

The 10 Commandments of Financial Happiness

  1. Thou shalt get “pretty” well organized. Have some sort of a system that you understand that enables you to keep track of your finances quickly and without hassle.  People who say they are ‘pretty well organized and can find what they need quickly’ are happier than those who aren’t and those who can’t.  Why? Because they’re not wasting time searching for the information they need.
  2. Thou shalt pay bills as they come in rather than all at once. People who pay their bills as they come in are happier.  Why?  Because paying them all at once is drudgery, and seeing all that money fly out the door at once can be emotionally draining.
  3. Thou shalt keep tabs on your cash. If you feel that money evaporates out of your wallet and you don’t know where it goes, you are more likely to be unhappy.  What’s the best way to prevent that from happening? Keep your receipts, or withdraw a certain amount of cash at certain intervals.  Also, people who balance their checkbook regularly are happier than those who do not.
  4. Thou shalt save at least 5 percent of your household income. People who save are happier.  There is a pretty powerful relationship between saving and investing and being happy at all with your finances.  In fact, for those who save at least 5% of their income, their happiness soars.  Chatzky recommends setting up an automatic savings program that transfers money from your checking account to savings before you have a chance to spend it. Over time, you can gradually increase your percentage of savings well beyond 5%
  5. Thou shalt protect your family and yourself. Doing all you can to shelter yourself from financial hardship in the future is an important part of financial happiness.  Having an emergency fund, writing a will, and purchasing life and disability insurance will all help to reduce financial stress and worry.
  6. Thou shalt minimize credit card debt. Credit card debt that is not paid off saps us of financial and life happiness, according to research.  So eliminating credit card debt helps increase happiness.
  7. Thou shalt do unto others. Volunteering, donating money, or giving away stuff, has the ability to add to your personal happiness.  Among all charitable activities, giving money to the causes you believe in has the strongest tie to personal happiness, along with volunteering in those causes.
  8. Thou shalt spend sensibly. Take a look at what you regularly spend money on.  Can you identify specific items that are sabotaging your ability to live within your means?  If so, find a way to eliminate or reduce your spending on it.  Spending no more than you can afford on anything will lead to greater financial happiness.
  9. Thou shalt start working toward your goals. Attaining happiness is not a matter of having achieved your goals, but a matter of making progress. People who are steadily working toward their goals are much closer to the happiness levels of people who are already there than those they’ve left in the dust.
  10. Thou shalt communicate. Constantly fighting with your spouse about money is a drain on happiness, so be sure to involve each other in your spending and borrowing decisions.  If you can communicate about money in a positive way, you’re likely to live a happier financial existence.
  11. Thou shalt try not to be consumed with a desire for more. I know, this was supposed to be 10 commandments, but Chatzky threw one more in for good luck.  The first 10 commandments are behavior-oriented, the last one is about attitude.  It asks you to focus on enjoying the life you’ve already achieved instead of continually wanting more.

Here’s my take:

I agree with her on all of these, and she’s definitely given me some things to think about…and some work to do.

The one that jumped out to me the most is #9, which reminds me of the importance of just getting started and taking that first step.  I am amazed at how “getting started” on the journey – any journey – can make a big difference in our happiness.

And I’ve noticed that the more “little victories” or successes we have along the way, the more motivation we generate to keep pressing on until our goal has been achieved.

What about you? Are you financially happy? Will these 10 Commandments of Financial Happiness help to increase your happiness in your finances and life?

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