Tracey Sofra Blog

What Is Guiding Your Financial Decisions?


"Your beliefs become your thoughts,
Your thoughts become your words,
Your words become your actions,
Your actions become your habits,
Your habits become your values,
Your values become your destiny."

Mahatma Gandhi

What's guiding Your financial decisions?

No two people are the same, especially when it comes to our values. Even people who have similar values prioritise them differently, which means they make different decisions in the same situations

Dr. Lois Vitt, the author of the excellent book, "Values-Centred Financial Education", groups values into four broad categories

  • Inner values (psychological and spiritual): Values that shape our principles, sense of meaning, financial security, and accomplishment
  • Physical values (health and environment): Values about our health and well-being, possessions, and surroundings
  • Social values (people and community): Values about belonging, connections, and relationships with others
  • Financial values: Values about money, investment, value and cost, and financial security

These aren't mutually exclusive, and you will have a mix of values between these four areas. However, it's useful to understand your own preferences, so you know what guides your financial decisions.

Complete the following questionnaire to assess your values in these four areas.

Your Life Values Questionnaire

You will see five statements for each of the four categories Inner, Physical, Social and Financial. For each statement, decide whether it's generally true for you. Do this quickly and go with your first instinct. Be truthful - give the answer that really applies, not what you think somebody else would approve of!


  1. My home is a reflection of me, not just a place to live.
  2. When choosing health insurance, I prefer an option that gives me greater control and more choices if I need to use it.
  3. I like to live in a quiet area without nosey neighbours.
  4. If I won $2,000 in Lotto, I would spend it on myself to enjoy a great experience.
  5. I'm planning for a retirement that allows me to continue living a happy and fulfilled life.


  1. I'm happy with my material possessions (e.g. house, car).
  2. If I win $2,000 in Lotto, I'll use it to buy a luxury item (e.g. a flat screen TV).
  3. I invest in my personal health and fitness (e.g. organic food, gym membership).
  4. I go away on holidays every year.
  5. I buy brand-name and premium items (e.g. latest iPhone, Thermomix).


  1. I like work that helps my colleagues and other people.
  2. I like to live in a community-oriented neighbourhood.
  3. In choosing holidays, I don't mind where I go, as long I can spend time with people I like.
  4. My retirement plans are based on the future needs of my family.
  5. When choosing new products or services, I strongly value the recommendations and referrals of people I know and trust.


  1. I have a "cash cushion" of at least 6 months' worth of salary/wages in savings.
  2. I have a reasonably high limit on my credit card, and pay it off in full every month.
  3. I'm focussed on paying off my mortgage as soon as possible (or have already paid it off).
  4. I almost never make impulse purchases.
  5. I have appropriate levels of personal insurance (life, TPD, income protection, and trauma).

If you score 3 or more in any of the four areas, this indicates a strong preference for those values. You can use these results to guide your future financial decisions so they are aligned with your values:

  • Inner Values: You will feel happiest when you make financial decisions to increase your independence, autonomy, and financial security.
  • Physical Values: You will feel happiest when you make financial decisions for a comfortable lifestyle, personal health and well-being, and enjoying tangible benefits of your money.
  • Social Values: You will feel happiest when you make financial decisions that involve others and for the benefit of others.
  • Financial Values: You will feel happiest when you make financial decisions that build on the financial skills you have learned, with the intent of improving and securing your financial future.

How did you Score? Was it a surprise or right on the money?








Posted by Tracey Sofra at October 28, 2016