Speaking on a topic that had nothing to do with personal finance Dieter F. Uchtdorf , a counselor in the first presidency of the Church of Jesus Christ of Latter Day Saints, said the following:
The what is important in our work, and we need to attend to it. But it is in the why… that we discover the fire, passion, and power….
The what… teaches us what to do. The why inspires our souls.
The what informs, but the why transforms.
Whenever we start something difficult – something that requires discipline and self-control – it is a good idea to begin with the why. To successfully transform your personal finances will take a long-term commitment and will not be possible without the “fire, passion, and power” that comes from the why.
Dave Ramsey, nationally syndicated radio host and best-selling author, has helped thousands of people get out of debt and improve their financial situations. He has done this by focusing more on the why than the what. Speaking on this topic Ramsey said “Personal finance is more personal than it is finance; it is more behavior than it is math.”
For me the why of personal finance is the desire for independence, the hope to retire comfortably someday, and the joy in building something and watching it grow. As I pay off debt, save, and invest I enjoy watching my financial situation improve. I am an investor at heart, and I love putting the power of compounding to work in creating a future that is better than today.
Warren Buffet, perhaps the most successful investor of all time, didn’t have a hard time being thrifty when he was first starting out because he saw every dollar, not as a dollar, but as ten dollars in the future. It is this principle that motivates me.
The why of personal finance for my wife, Alice, is peace of mind and the desire to do more to help others who are struggling. She hates the idea of being in debt, and she has more empathy than anyone I know. Her desire to help others is a powerful why for her.
What motivates you to improve your financial knowledge and habits? Think about it, write it down, and internalize it. You will need to rely on it when things get tough. To be successful in improving your personal finances you will need more than knowledge. You will need the “fire, passion, and power” that comes from the why. I would love to hear from everyone about what motivates you. What is your why?