How to Spend More Intentionally & Make a Bigger Impact with Your Dollars

With the many pressures of daily life, it can be easy to slip into autopilot when it comes to spending money. Indeed, many of us are conscious about how we invest our hard-earned dollars. Yet we may not be as diligent about where we spend them. To truly align our money with our values, we need to be just as purposeful about which businesses and causes we support with our spending. In this article, we’re sharing ideas for how to spend more intentionally to make a bigger impact with your dollars.

Identifying Your Values

Before you can spend more intentionally, you need to get clear about what’s most important to you. For example, if you’re committed to investing for impact, you may want to direct your spending towards businesses with strong ESG practices. Another example may be supporting women- or minority-owned businesses to help them thrive and level the playing field for all.

No matter your goals, identifying your core values— the things you believe are most important in the way you live and work—is often a helpful place to start when it comes to spending more purposefully. If you’ve never taken the time to go through this practice, here are some ways to figure out your values:

• Identify the times when you were happiest and determine what parts of that experience brought you joy.
• Find examples of times you were proud of yourself and ask yourself why you felt that way.
• Think about the times you were most satisfied or fulfilled and determine why that experience gave your life meaning.

Going through this exercise can help you identify your values based on your happiness, fulfillment, and personal achievements. You can also take this personal values assessment.

Once you identify your core values, you can determine what spending more purposefully means to you. Below are a few ideas for how to spend more intentionally.

Consider these 4 ideas to spend more intentionally:

#1: Shop Local

Shopping local can be a great way to strengthen your community. Strong local businesses boost the local economy and provide jobs for residents. In fact, for every $100 spent at small businesses, $48 is put back into the local economy, according to data from Intuit Mint.

In addition, shopping local can help reduce reliance on larger chains with less commitment to their communities. These conglomerates may also have less responsible business practices than small, local businesses. If you want to spend more intentionally and make an impact, consider keeping money within your local community.

#2: Support Small & Emerging Businesses

One of the great things about living in the U.S. is that nearly anyone can start their own business. But keeping a business going is much more challenging. Indeed, more than 20% of small businesses fail in the first year, according to data from the Bureau of Labor Statistics. And nearly half of new businesses fail within the first five years.

Unfortunately, the Covid-19 pandemic exacerbated many of the challenges small business owners often face. It also introduced new ones, making it even more difficult for small businesses to thrive. Meanwhile, corporate giants like Amazon, Microsoft, and Apple gained market share throughout the pandemic.

Convenience and safety were no doubt paramount during the height of lockdown. However, now may be an opportune time to reassess the businesses you support with your spending. Even if you only allocate a fraction of your budget to small and emerging businesses, making the commitment to spend more intentionally can meaningfully impact the lives of these small business owners.

#3: Support Businesses That Share Your Values (And Avoid Those That Don’t)

At times it can feel like the line between business and politics is becoming increasingly blurred. There are many businesses attempting to do the right thing by pushing back against policies that don’t align with their values. For example, Disney has made headlines recently for denouncing Florida’s HB 1557 law. And hundreds of companies united in 2021 to oppose efforts to enact new election rules in almost every state.

On the other hand, there are many companies that may not share your values, either through their business practices or the personal views of their leaders. For example, Amazon was maligned in the press recently for how the company treats its warehouse workers. Another popular example is Chick-Fil-A, which caused a media uproar for donating to charities with anti-LGBTQ stances. Although Chick-Fil-A has since made changes to its giving approach, many LGBT activists and supporters continue to avoid the chain because of its polarizing views.

Ultimately, it’s up to you to decide which values you want to support and oppose when spending your money. As businesses play a greater role in public policy, however, making the effort to spend more intentionally may help further the causes most important to you.

#4: Give Strategically

Lastly, spending more intentionally doesn’t need to be limited to your purchases. Indeed, large charitable donations are often a component of tax and estate planning. Still, many of us also choose to make giving a recurring budget item.

As you make smaller donations throughout the year, be careful not to fall into the trap of “peanut butter philanthropy.” This term describes the practice of making many unfocused donations that ultimately have minor to no impact on the causes you think you’re supporting.

Instead, consider being more purposeful about your donations by choosing one or two organizations to routinely support. For example, you might consider donating to a community development fund to support communities that don’t typically receive financing. Or you can donate to a microfinancing organization like Kiva, which makes microloans to individuals who don’t have access to traditional banking. Microloans aim to provide enough money to make a difference to an individual’s life but that is still manageable to pay back. They’re often given to people to grow a business, fund an education, or make eco-friendly swaps.

These are just two examples of how you can spend more intentionally in your philanthropic endeavors as well. Even small donations, when made strategically, can impact the causes you wish to support.

Making a Commitment to Spend More Intentionally Is a Practice, Not Perfection

Like any habit, committing to spend more intentionally typically doesn’t happen overnight. Furthermore, don’t beat yourself up if your spending doesn’t always align with your values. The goal isn’t to be perfect. It’s simply to be more aware of where your money is going and which organizations and causes you may be furthering as a result. Like investing, when you spend according to your values, you may begin to feel more fulfilled and better about your money.

A trusted financial advisor can help you look closer at your money habits and align your finances with your values and goals. If you’d like to speak with a member of the SageMint Wealth team to see if we may be a good fit, please contact us. We’d love to hear from you.