March 9, 2021

How do you view money? More often than not, the way we think about money is learned from our parents. We watch their behaviour as children and subconsciously build a financial narrative that influences the rest of our lives. But we can re-write our story to create a healthy and productive financial mindset.

1. Think long-term

Life is full of trade-offs and choices in regard to finances. It can be difficult to know which path to take:

• Spend now or later?

  1. Private education or an yearly family overseas holiday?

  2. Save for a house deposit or travel and see the world?

  3. Decide to be stay-at-home mum or continue working to maintain your career?

When you are faced with a major financial decision, particularly one that is also a lifestyle choice, look long-term. Ask yourself what will the options will mean for you in 10, 20, 30 years’ time?

1. Make mistakes

Perfectionism is an enemy of decision making. Every choice brings an element of risk:

• What if my investment doesn’t go well?

  1. What if it doesn’t go up in value / bring returns?

  2. What if I invest in the share market just before a downturn and lose money?

  3. What if I engage someone to help me navigate the world of finance and it doesn’t work out?

People learn by doing – and that includes making mistakes! To succeed, you risk failure. You may make wrong decisions. But this is where you learn and grow. Observing others’ mistakes and successes also contributes to our learning. Don’t let fear hold you back from making decisions. Be aware, educate yourself, weigh up your options and make informed, proactive decisions.

1. Include healthy financial habits in your everyday life

Enjoy the process as well as the end result. You might have a list of goals you wish to achieve:

• travel

  1. go on an overseas trip

  2. retire early

  3. buy a house

  4. buy a bigger house

  5. buy a holiday house

  6. renovate your kitchen, bathroom etc.

but, as you move from goal to goal, you may not fully recognise your achievements and, therefore, won’t feel truly satisfied.

When you make healthy financial habits part of your life (and, remember, it takes two months to form a habit) you will enjoy both the journey and the success of achieving your goals https://www.clevergirlfinance.com/blog/money-habits/

1. Focus on one thing at a time

It’s very easy to become overwhelmed when you have many things you want to achieve. Break your financial list of goals into priorities, then pick the most important one and further break it down into achievable steps. Focus on the first goal and work your way through the steps, checking in on your progress each week / fortnight. This builds confidence, creates satisfaction and reduces any feelings of overwhelm you may experience.

1. Don’t follow the crowd

Align your goals with your personal values, not someone else’s. Be aware of what’s important to you and create financial aims to support your lifestyle and choices.

1. Discipline and boundaries in place

What are the consequences for not sticking to your plan? Maintaining control of your finances takes discipline but the good habits you create will soon become second nature.

1. Learn your blind spots

What stops you from achieving your goals?

• Overspending?

  1. Inability to say no?

  2. Money mindset?

  3. Unhealthy relationship with money?

Making excuses will not help you build healthy financial habits. Take the time to understand your view on money and where it stems from. Be aware of the roadblocks you tend to put in place. This will enable you to recognise and overcome them when they arise so you can move through and continue to achieve your best financial life.

Working on your money mindset will create strong, positive habits and help you build a secure and financial future.

If you would like to improve your relationship with money and plan for your future, please contact TruWealth on 03 8648 6534 or email contact@truwealthadvice.com.au

This is general advice and does not consider your particular circumstances. You should not act on this advice without speaking to Truwealth Advice who can consider if it is right for you.