What’s your money motivation?

My children always study last minute. This bothers me. As an adult I understand the benefit of regular study and practice. Recently, I realised that they seem to require less persuasion to sit down and study if I propose a quiz at the end. I concluded that they are more motivated to learn and study when they know they will be tested on it.

Testing means there is a clear outcome; you know whether you are good in a subject or not. Perhaps, being measured for their knowledge is the motivation.

Then I got down to thinking about the rush to see the Coldplay concert in Mumbai, happening next month. No one I know directly was able to get tickets for any of the three days they are playing in Mumbai. Now that they have announced a fourth day of live performance in Ahmedabad, a few people I know have bought tickets to go there and watch the show. Several others, who were in queue for the Mumbai tickets but didn’t get any, are not motivated enough to travel to Ahmedabad. Is it the cost or the time to travel to a different destination or are both a deterrent?

Our choices lead to more satisfying outcomes when the motivation is right. Without the motivation of seeing their performance in terms of a score, children are less motivated to put in hours of study. Without the convenience of time, the motivation to watch a concert is lower. Similarly, money transactions too, be it earning, spending, saving or giving, are motivated by some end goal. But we don’t spend enough time trying to understand what that underlying motivation is. More importantly, how can you recognise the motivation that will help you optimise your money actions?

The right motivation

If you switch jobs because you are highly motivated by the pay hike, then you need to know what you will do with the incremental income. If the incremental income gets spent frivolously, your motivation for earning more will resurface too quickly, forcing you to look for the next switch and the next. Instead, if you channel your motivation of a pay hike into understanding how you can effectively use that incremental income, you will find the joy in achieving that goal. Then the desire to jump to the next job for an even higher pay is not so nagging. You will have more time to focus and grow your skills at your current place of work.

Maybe you need the money to afford better accommodation or an expensive school you would like your child to study in, whatever it might be, recognising the motivation behind wanting a pay hike often helps you feel more satisfied and also optimise your increased income. Plus, with the right motivation guiding you there is a greater likelihood of finding more suitable jobs which in turn motivate you to work better as a professional, rather than just chasing a higher income.

Let’s talk about large spends like buying a big house or a big car. Are you buying it to please your spouse or parents or because that’s the way you believe that life events must progress? If the motivation is to please someone else, you will needlessly end up with the stress of a big loan repayment, repairs and a house that was bought without considering your daily needs of commute, amenities and so on. Instead, what if the motivation to buy a house is to ensure that your child’s school is across the road or because that’s the area you grew up in and your entire support system lives just 2-5 minutes away or because your place of work is next door? With such motivation, any stress that comes from unfulfilled gaps as a result of this choice get balanced with the unique benefits for which you made the choice to begin with.

Similarly, figure out the right motivation for your savings too. Devoid of this, your savings will either continue to fall short or you will end up spending most of it soon after you have accumulated a sizable pool.

Make sure that your motivation is grounded

In India most families are motivated to accumulate gold from the time their child is born. There is an unsaid understanding that if nothing else this gold will be useful in the child’s marriage. A few years ago in a media panel discussion, a very senior banker admitted while that both her son and daughter had rejected the idea of wearing or gifting large quantities of gold in their weddings. What’s more, since they had decided to settle overseas, they did not want any of the real estate that their parents had invested in, for them.

Providing for your children or trying to leave a financial legacy for them is a valid motivation but you must also recognise that it’s not their motivation. Your children are unlikely to live out your life’s dreams and desires. Hence, you can consider transforming this motivation to create a legacy into a more accessible and useful outcome. Accumulated financial investments for example, instead of gold and real estate, could be used as they please.

What’s the use of being motivated by an outcome which pleases you but fails to have an impact on those who you intend as the beneficiaries of the money decision.

The right motivation, be it in any aspect of life, has the potential to deliver the most accurate results. When it comes to money, aligning your motivation with your life’s values, aspirations and actions that best define you as a person are better placed to deliver more accurate results. Tweaking it for convenience and best end use, is another aspect to consider. If your motivation is linked mostly to displaying status, trying to match other’s expectations and keeping up with your neighbours then the outcomes are likely to be unsatisfactory at every level and even if you don’t desire it, you will not be able to stop chasing more.