What Is Your Why?

As you may have gathered from my previous blog posts, I am passionate about teaching financial literacy to others – particularly the next generation, which includes my daughter. One of my outlets for this is teaching a financial literacy class to high school seniors at our local public high school.

We cover many key topics including tracking spending, calculating and monitoring net worth, discussing various assets and liabilities, understanding interest and compounding, appropriate insurance coverage, personal income taxes, etc. It is very much a how-to class for personal finance.

Recently I was asked to design and facilitate a similar program for adults. After thinking about how I might modify the instruction for this group, it dawned on me that one important topic was missing from the curriculum.


Not why is this information missing, but rather…

Why is this subject important? (Or is it?)

And assuming it is…

Why is it important to you?

To help explore this topic further I reread the book The One-Page Financial Plan by Carl Richards. He devotes the opening section of the book to this very pertinent question.

All the personal finance how-to instruction and understanding may be for naught if you don’t know why you are acquiring the knowledge in the first place. If there is no end goal – your Why – following through with putting your financial life in order and remaining on that path may eventually lose precedence over other endeavors.

Providing Focus

This particular quote from the book really stood out to me:

“The reason I ask my clients this question is because it helps us understand their values. Often, the process of asking “Why?” – “Why is money important to me?” or “Why have I been so anxious about money lately?” or “Just why do I work so hard anyway?” – uncovers deep desires and fears that we are often too busy or too scared to think about. While the process can be uncomfortable, recognizing what really matters to you is the first step toward making financial decisions that are in sync with your values.”

Carl Richards

In the Financial Independence (FI) community, people are often asked “What is your Why of FI?” At the most recent CampFI event my wife and I attended this past June there was even a pop-up podcast that asked participants this exact question.

Frequently when asked this question, typical responses include “freedom,” “flexibility,” and “security.” But it is important to continue probing deeper to get to the root aspiration – ask yourself why is freedom, flexibility or security, etc. important to you? What would achieving that mean to you? What might your life look like if this were achieved?

The 5 Whys

You can use The 5 Whys method to drill down to your core answer. Originally developed and utilized by the Toyota Corporation, it is a process for getting at the root cause of a problem by repeating the question Why? After answering the first question of Why, continue with follow-up questions of Why to funnel down to the base answer. Typically 5 iterations of the question will get you to the answer. However, it may only take three or perhaps may even require more than five.

Here is an example of what this exercise might look like:

Why are you interested in learning more about personal finance?

“To have more control.”

Why do you feel you need to have more control?

“I would like to eliminate this debt that hangs over me.”

Why would eliminating your debt make you feel like you are in more control?

“Then I could increase my savings for important goals.”

Why would increasing your savings allow you to reach these goals?

“Because I could eventually choose to work less instead of having to work to pay for past purchases.”

Why would working less be an important goal for you?

”Because I could spend more time with my family.”

In this example, the ultimate goal is not “control”, but being able to spend more time with family realizing that time is a limited quantity in life. Once you understand your true Why, you will have a clear goal to strive toward.

Why Is This So Important?

Financial goals that satisfy your Why tend to be longer term – they aren’t achieved overnight. Yet, day-to-day living requires ongoing financial choices that are often in direct competition with meeting or achieving these longer-term goals.

If you can re-frame your focus to view your financial decisions with your ultimate Why top of mind, trade-offs to meet your goal will be much easier to process. For example, if the desire to cut back work at some point to spend more time with family is your Why, opting not to the purchase a new car and buying a used one instead – or better yet, maintaining an existing one or even eliminating a second vehicle – can be viewed in the context of that goal.

You could then ask yourself, is that new car really more important than being able to work less and having more time with my family? Or more simply, do I want to work more hours to pay for that new car, or would I rather spend that time with my family? Purchasing a new car will not satisfy the goal of spending more time with family – quite the opposite.

Sometimes having the latest and greatest shiny new thing appears justifiable at the moment, but when weighed against moving the goal post of your Why further in the distance, the sacrifice required doesn’t seem worth it – and it is often completely contradictory.

When Couples Are Involved

When sitting down to determine your Why, if you have a spouse or significant other, it is important to do this exercise independently. Many people are surprised to find out that their own Why may be far different than their partner’s. Once each person has defined their own answer, they can be shared and discussed openly to determine how each Why can be achieved – or modified if necessary and blended together.

Often, couples don’t have these conversations until they are forced to. Sometimes these conversations are sparked by some type of financial event. An example could be a large bill or expenditure by one person where the other questions the importance. This is not the time to have the conversation regarding each person’s priorities and goals in life. This will more likely than not lead to confrontation.

How To Get Started

Pick a quiet time and place free of distractions to ponder the question – “Why?” You may find that it takes some time or even multiple attempts to define your Why.

If you are having trouble answering the question, you may be able to look at your own spending patterns and time allocation for help. What do you spend your money on? How do you spend your free time? Are these expenditures of time and money in line with what you value?

You may find that you spend ample time and money on things that aren’t actually that important to you. Is this something that you can change so that you can spend more time and money on things that are important?

Aligning your spending and time with experiences and things you value is one way to start achieving your goals today.

Focus on Your Why

Remember, there will always be trade-offs to achieving the goals you have set for yourself – but keeping your Why top of mind will enable you to set priorities in sync with what you value most.