Personal Finance Series: No 4 - Happy? Why You Can't Be Bothered!

The study of happiness is becoming increasingly mainstream, and in applying this new science to the understanding of personal finance, financial planning, money management and financial goal setting, there are a specific set of characteristics which identify how people are happy with money.

Although very few people admit to being happy with money, or happy with personal finance, happy people do not wait for things to come to them, they get up, get out and get stuff done.

They volunteer their time, and move on from difficult circumstances quickly. Happy people take action, they are proactive, and to understand how to become money-happy, it is useful to understand the opposite position.

Happiness: The Reasons Why People Don't Take Action

You don't need a financial planning degree, or embarking on a financial planning career to be able to take action with personal finance worksheets, yet the most obvious reasons for not taking action include laziness, guilt and depression.

Some people just ignore their money, and even though they understand that doing nothing is damaging, they don't have the motivation to do anything about it. This often leads to guilt and depression - but not action!

Also, many people not talking action with their personal finance generally believe there is not much point in doing so. They can't 'see' the bigger picture of things like goal setting motivation theory, or investing to make money because they have low self-esteem.

Happiness: How The Brain Solves Financial Problems

Mainly, people react rather than prevent, which means the path to financial happiness is far from smooth, and it depends largely on the degree of discomfort being felt, the amount of pain each person is in. The brain does have some degree of regulation in that most people can get to the point where they realise that they " just cant afford it any more," but not much beyond that - unless helped by a system of personal finance budget software, or a home budget worksheet.

There are 3 ways the mind sorts problems

1. The 'long way round' is to break the problem into its logical sequence and seek the patterns in order to find a budget solution
2. Most people go by a 'rule of thumb' approach by measuring their solutions with their gut feel
3. The most creative is insight where the mind does some creative visioning about the financial possibilities

Happiness: How to Get What We Want and Keep What We Get

Happy people find an energy from within themselves or from around them, which fuels their kindness to others. They smile a lot and don't get embarrassed by laughing in public. They are responsible with savings, with an eye on security 'smoothing' for the unexpected rainy day! They are enabled by financial planning software, goal setting templates, affordability calculators,and are comfortable with managing their personal finance online.

The sequence therefore in proactivity is to;

1. Concentrate on a goal setting template, just as if you were doing goal setting in business and isolate big goals and little goals by naming them, identifying them and money-tracking them.
2. Set budgets for different aspects of lifestyle, set the rules, and stick to them.

By understanding why you don't take action, and how your brain thinks about money, it is entirely possible to manufacture the conditions under which happiness can be achieved. When this is supported by proactive, online tools which take all the hard work out of managing money, "why would anyone choose to remain unhappy?"