Seven Common Money Mindset Beliefs

Money mindset means something different to each and every one of our clients. Before they come to us, our clients have all had different experiences with regards to money from when they were children, all the way through adulthood and the point they find us.

A lot of what our clients experience in terms of their money mindset is simply nurture over nature: it’s a reflection of how they’ve been brought up, how money was treated in their home and how money habits were taught to them from a young age.

There are, however, commonalities between many of our clients and we work with them through their wealth journey to support and guide them while negotiating all the different symptoms that a poor money mindset can present.

A poor money mindset can lead to poor money habits and because we’re not taught about money at school, home is the only place where we receive financial education. 

If you’re one of the millions of people out there who haven’t received a positive wealth education through your upbringing, the tendency is that you will not be able to grow your wealth to the degree that you would like. And that’s not your fault, it’s the way you’ve been programmed. You’re simply continuing on the wealth journey that started when you were young. 

“If you buy things you do not need, soon you will have to sell things you need.” - Warren Buffett

We see a lot of common symptoms amongst our clients who come to us with a poor money mindset including:

1. Spending = happiness
   We live in a culture that expects instant gratification and if we’re not feeling great, we buy things to fill an emotional void. Our clients often think more money will fix this when in fact taking control of your cash flow strategy and having a positive money mindset can remedy this (without you missing out on the things you enjoy).
   
   

2. Focusing on money mindset without strategic support
   While some of our clients do have an awareness of their money mindset and how it’s playing out in their lives, without real strategic support and accountability when making the bigger decisions in their wealth journey, it can be really difficult to implement changes that make a big difference.
   
   

3. Money is the root of all evil
   Unfortunately, many of us are brought up being taught that money is the root of all evil, rich people are bad, or greedy and so there is an expectation that to be wealthy you have to change who you are as a person. When, in fact, this isn’t the case. It’s simply the messaging that you’re absorbing from a young age. Instead, think of all the good you can do in the world as you grow your wealth.
   
   

4. We can DIY and get results
   A really common thing we see in our clients is the frustration and disappointment of DIYing your wealth journey and simply not making headway. Or the progress they’re making is slow. Often our clients have given it a really good go and are sticking to a tight budget but at the same time are feeling deprived or that they’re missing out on the things in life that they enjoy. Or they feel that they won’t actually be able to achieve all they want to achieve in terms of financial freedom or worse, that they are going backwards!
   The core of the way we work at AFA is that cash flow strategy and having a real roadmap is key. You can maintain and even improve your lifestyle by prioritising your real goals and examining and managing every area of your financial life. We don’t work with you to retain your poor money mindset, we work with you so you feel in control of your money and empowered to make decisions that will grow your wealth.
   
   

5. We have no money to invest!
   It can be really challenging to look at your finances and find excess to invest. You may have read The Barefoot Investor and be having those date nights but are yet to see your long-term goals come to fruition. The core elements that your financial adviser will work through with you are around organising your money to streamline your cash flow, supported by a crucial element that is often overlooked: supportive accountability. With the support of your dedicated AFA Wealth Coordinator, we will forensically work through every aspect of your financial situation and diagnose the root cause of the problems you are experiencing.
   
   

6. We know we can’t take our wealth to the next level alone but don’t know where to start
   There is so much information on how to handle your money out there but many of our clients consume and consume and consume and just end up in a place of overwhelm, instead of where they’d like to be: wealthy.

Let’s face it: managing your money is time-consuming! Trying to keep up with every announcement from the reserve bank, every mortgage product change and insurance regulation is hard work (and boring, according to our clients, lucky we find it fun!).
Think of the difference a really good coach makes: when Roger Federer hired a coach it literally made the difference between him winning Wimbledon or not. That’s what a great money team can do: it can be the difference between you achieving your goals in five, 10, 20, 50 years time or not. Those small percentage differences it takes to win Wimbledon compound over years of money management and can be the difference between living an “OK” life and living a life of financial freedom.

7. We have goals but no real roadmap to get there
Our clients come to us and say: “we are going to retire at 55 and cruise the world” and the question is always, “great! How are you going to make that happen?”. We love working with our clients on their big goals in life: these are the things that give life real meaning and pleasure.
Unfortunately, many people spend their lives working towards a goal with no real roadmap in place to actually achieve that goal in a concrete way. Instead of having a goal with no strategy, we work with every one of our clients not only on their short-term cash flow strategy but also towards achieving their big life goals. Want to buy a new car? Take the kids to Europe in 2025? Help your kids with their first home deposit? Whatever the goal, if it’s important to you, it’s important to us and we’ll work with you to ensure that you have a real roadmap in place to achieve it.

We work with our clients on techniques of being able to adapt to having a wealth creation mindset that's both for you and for the next generations. This is something that's experienced at all levels of the AFA Wealth Freedom Model and we work with our clients to overcome their money mindset blocks to come out the other side with a healthy, abundant money mindset and to leave a money mindset and wealth legacy for their children and their children’s children.

It’s not just understanding your money mindset but also being able to execute on that mindset and making strategic decisions around money.

What I have found with working with a range of clients over the years is those who have wealth combined with a great money mindset keep and grow their wealth. Whereas those who have a poor money mindset might have wealth but have a tendency to spend more than they have and earning more money won’t fix that problem, only a better money mindset, combined with cash flow strategies and guidance will help. We’ve all heard about people who win Tattslotto and then blow the lot and end up with less than what they started with: that is a reflection of their money mindset, not the amount of money they have.

The great thing about a money mindset is that it’s changeable. With the right guidance, education, support and accountability, you can flip your money mindset from one of lack and never having enough, to one of wealth, abundance and financial freedom.