Women face obstacles when it comes to making money.  There’s that notorious pay gap—women making 80.5% of what men make.  And even more disturbing is the fact that the more senior you are the greater the pay gap is.

And there’s a lot of conversation these days (including on the Advice to My Younger Me podcast) about how women can make more money—how to negotiate a raise or ask for a promotion.

But there seems to be less conversation about how to spend your hard-earned money so that it will have the greatest impact on your overall happiness.  Several of our podcast guests – Anne Devlin, managing director at JP Morgan Chase. Christine Lane, a financial coach and Cait Flanders, author of the Year of Less—have addressed these issues.

Here are some of the important takeaways from those conversations.

1. Understand your financial situation

Become a student of your personal finances.  Have the courage to really look at your financial situation; it can be revelatory.  Know what you make, what you owe, what you spend and how much you’ve saved. Have the courage to open your loan statements, review your bank statements, and look at the balance in your savings account.  Track your spending (at least for a month) with an app or a pen and paper.

2. Align your spending with your goals

Personal finance is personal.  Figure out what is important to you in life and what makes you happy.  Think about your short and long-term goals.   Align your spending to optimize those things.

3. Be a mindful spender 

Don’t spend money unconsciously.  Ask yourself: “Why am I considering making this purchase?”  Be aware of your spending triggers.  What are the circumstances in which you overspend or spend out of alignment with your goals?

4. Buy for the real you, not the “idealized” you 

Podcast guest Cait Flanders says there are things that you spend money on which you actually use.  And then there are things that you buy for the “idealized version” of yourself.  You may buy books that a more intellectual version of yourself would read or a camera that a more creative version of yourself would use or a dress that a more social version of yourself would wear.  The question you should ask is, “Are you buying this for the person you are, or the person you want to be?”  Buying things will not make you into a different version of yourself.

5. Focus on experiences

Research shows that spending money on things—a new pair of shoes, a new couch, or a new car—only results in a short burst of happiness. But spending money on experiences—like travel, athletic or artistic endeavors, or time with family or friends—is more likely to make you happy.

6. Spend less than you make

Money is freedom.  Amassing adequate savings gives you options.  Knowing that you have enough money to weather a period of unemployment opens up a world of possibilities.  It gives you the freedom to ask the really difficult questions about whether this job or career is the right fit for you.  Knowing that you have a financial safety cushion lets you take a less well-paying job in the public sector.  Having a healthy savings account allows you to take that dream vacation.

7.  Save for your future you

Small investments compound over time.  The most important step is to invest something, regardless of how little that amount may seem today. Pay your future self first.  Your future self will thank you.

For more great insights about spending and happiness, listen to episode 29 - Money, Mentoring, and More, episode 35 - Can Money Buy You Happiness, and episode 55 - A Year of Mindful Spending.