What do you wish you had known about money in your twenties and why?
I have walked a long and arduous journey trying to understand the psychology of money. My biggest regret is not realising how our relationship with money can influence our thoughts and actions around money, and result in self-destructive money behaviour, earlier on in my life.
I have used so much emotional energy trying to deal with my childhood memories and our very dysfunctional family life, just to realise that is was all about money and the meaning we attach to money.
My advice to my younger self would be to think about those early significant money memories and how they impacted on my life and influenced my relationship with money; to change my relationship with money by letting go of the stories that no longer serve me and to cherish those that do.
What were some of your early, most significant money memories?
It has taken me almost 40 years of self-reflection, reading, studying and researching to become the master of my money, putting money in its rightful place in my life.
Our relationship with money is a fascinating subject. I have come to understand that your relationship with money reflects the relationship you have with yourself.
I grew up in a middle class family with a stay-at-home mom. In our house, my father was in charge of all the money and gave my mom a housekeeping allowance. It is clear to me now that my father had dysfunctional money habits.
We were not allowed to watch television during the day (a waste of electricity), the tumble drier was locked in the garage (too expensive to run) and the telephone was always locked. My mom had no access to money other than what my dad gave her. Don’t misunderstand me: we had money – more than enough of it. But my father controlled it and bullied my mother by restricting the amount of money she could access. I have realised that my father used money to control, as a tool of power, either to give, or to deny.
My childhood memories illustrate two things: firstly, how one person can relinquish their financial freedom to another and, secondly, how all of us are shaped by our first significant money memory.
My experience while growing up has driven me to vigorously pursue my financial independence. Asking for money is an absolute no for me. In addition, I am acutely aware of how money can be used as a means to control. For too long, I allowed myself to be the servant of money, allowing my money psychology to shape my decisions, financially and otherwise.
Being aware of how your first significant money memory influences your actions, decisions and behavior helps a great deal in shaping and changing your mindset about money.
Our money memories are mostly rooted in our formative years, and lie quietly and subconsciously in our thoughts until we unlock them as memories and become conscious of them. They are based on belief, rather than reality.
Today I see money as a tool that gives me freedom of choice – freedom to pursue and explore ways in which I can use my experiences to live a life of purpose and meaning.
What tips would you give to your younger self?
1. Money is just a currency; it holds no other power other than that. Money is a means for helping us navigate where we want to go.
2. Give money the attention it deserves. Talk about money, think about money and understand your relationship with money. Money should not control you. You should be controlling it.
3. Be clear on what money means to you. Does it allow you to live the way you want, every day? Does it enable or limit the fulfilment of your dreams?
4. Become the master of your money. Money should be an enabler. In its rightful place, money enables you to live life right.
On the topic of money, what is the most indispensable piece of advice you’ve received?
Your thoughts become your reality. Bruce Lee says it so well, “as you think, so shall you become.”
Very often, the meaning we attach to money reflects what we believe about ourselves, and if we repeat these messages often enough, for long enough, it becomes our reality. It does not matter whether your beliefs are true, or based on fiction, your thoughts shape who you are.
We don’t only use money for financial purposes – we express ourselves through money; we use money to communicate. Money says, represents and does anything you want it to: it mirrors your desires, your fears, your measure of success, and your idea of happiness.
Even when we think about money, we are thinking about ourselves. Our beliefs and opinions about money mirror our self-worth, our perceived capability and what we think we deserve. This internal monologue becomes a habit of mind – and becomes your life journey.
Some people seem to scorn money and no matter how hard they work, they just never seem to get anywhere. Others attract money. I have met people with hefty bank balances who still feel “poor”. Some people enjoy the power and status that money brings and share their wealth abundantly, while others hoard, continuously afraid that the money will run out.
How you think and feel about money, affects your relationship with money, and determines whether you will have a healthy money mindset. Which in turn, affects your life.
Your money and your life cannot be separated. Money is a means to enable the life you envision for yourself.
What are your top money tips that you can share?
1. Guard your money thoughts. Positive, abundant, entitled thoughts enable a healthy money story for your life.
2. Plan for your life first, before planning for your money. Once you are clear on what you want to achieve in your life and have clear goals and objectives, your money can be structured to support your life plan, enabling it.
What is the most valuable learning you’ve had that has been fundamental to the way you think about money?
To be the Master of your money. Once you have made the minshift that money is just a currency, where you get to decide how it works for you, you can unlock its potential to realise the life you want to lead. It’s not about how much you have, but your relationship with money.
What mistakes have you seen people making when it comes to personal investing and wealth building?
I have helped clients retire for more than ten years, and have had thousands of conversations about saving, investing and returns. The most common mistakes I have seen people make include trusting advice from unreliable sources when it comes to investments.
We all love a good deal, but in the world of investment, greed or wanting unrealistic returns, can often be detrimental. As the saying goes, if something seems too good to be true, it probably is.
Before buying investments, do your research. Trust your instincts and consider who is selling the investment. If the return seems exceptionally high, or you have to borrow to invest, stay away. Make sure you are invested in quality, diversified funds.
What is the one tenet you ascribe to above all else?
My personal motto when it comes to money is to be inspired, be brave and be on purpose. I love Brené Brown’s concept of choosing courage over comfort. She says it so well:
“I think the people who wade into discomfort and vulnerability and tell the truth about their stories are the real badasses in this world. This is especially true of people who rumble with failure. These are people who choose courage over comfort, accountability over blame, and are able to embed key learnings from failures into their lives.” – Brené Brown
What lessons did you teach your kids about from a young age?
Given my personal money story and having learnt that children’s money habits are formed by the age of seven, I engaged in money conversations with my children from a young age.
Children learn most effectively from what they hear, see and experience. So, it’s not just about the conversations you have with your children. How you behave and what you do, also sends out specific money messages. Most of our communication is quite unintentional and we as adults have to be wary about the money messages we teach.
What are your top tips for having money conversations with children?
1. Involve your children in the transaction of money
Many parents start savings or investments for their children when they are young. Involve your children in the money that is saved for them. Teach them about investment options, the value of compound interest and get them to participate in the process.
2. Pocket money
Teach your children that money is earned by adding value through what they do. Encourage your children to earn their own money by doing chores or entrepreneurial activities.
3. Parents are role-models and children learn from example
Remember that children learn from what you do and say. Talk positively about work – it’s not a chore to resent, but an activity through which you earn money. Don’t measure your success by what you have. We don’t want our children to measure their self-worth by the car you drive or the labels they wear.
4. Mind power
A valuable lesson is the power of the mind. Our self-talk and limiting beliefs eventually become our reality. If you keep telling yourself that you are “poor”, then this is how the story of your life will go – and probably those of your children.
Encourage an abundant way of looking at money. Repeat positive money messages to yourself, and your actions will eventually follow, and so will the messages that you pass on.
Include conversations around gratitude in your family. Focus on all the things that you as a family are grateful for and discuss giving – giving brings pleasure and makes us feel purposeful.