Dear Money Voyagers,
Kate here, co-host of The Australian Finance Podcast and the person ready to help you invest your money and time, better! This article was originally shared in the Rask Education student newsletter. Simply sign up to a course on Rask Education (like our ETF investing course) to get this directly into your inbox each fortnight.
Today I want to talk about the ‘less cool’ part of investing: our behaviour and emotions. Because when it comes to money and investing, sometimes the hardest part comes from within.
By that, I mean things like taking that first step into the unknown, feeling like an investor, and understanding your money mindset.
“If you accept a limiting belief, then it will become a truth for you.”
~Louise Hay
⛅️ Are these limiting money beliefs holding you back?
There are many things that can hold us back from working towards our financial future.
Just think about the following phrases:
- I’m not smart enough
- I’m not good with money
- I don’t have enough time
- I’ll never be wealthy
- I don’t deserve to have money
- I’m afraid to make the wrong choice
These are just some of the limiting beliefs we might have around money.
Do any of these phrases resonate with you?
These thoughts are completely valid, but can often limit your ability to take control of your financial future.
The thing is, we all have unique backgrounds and a wide variety of experiences with money, from extremely negative (“how will I afford dinner?”) to really positive (“Hooray! A family holiday!”).
Unfortunately I can’t wave my wand and help you instantly overcome these long held beliefs, but education plays a big part in building your financial confidence over time.
Acknowledging your current situation is the first step to improving it.
What drives your money decisions?
We all have different reasons for the choices we make in life, and some of the most personal decisions we make involve money.
Identify the reason(s) why you want to learn more about money.
This could be in the form of a brainstorm, conversation with a friend or even a collage of images that represent your ideal future.
Once you know the why behind your money goals, it’s a lot easier to start working on overcoming roadblocks in your path.
🚧 Let’s knock down those roadblocks
So let’s go back to some of our reasons for not getting started and think about some strategies to overcome them. I’ve included a few ideas below, but get creative, do some research and have a think about what might work for you.
- I’m not good with money – YET. Schedule some time in your calendar to learn one thing about your finances each week.
- I don’t have enough time – Find 15 minutes a day or an hour a week in your calendar and stick to it. Committing this time now will pay off massively for future you.
- I’m afraid to make the wrong choice – Not making a choice is a choice. You don’t need a perfect plan to start, you can learn as you go. Schedule in time to do the work, work out your financial starting point and go from there. One step at a time! 🙂
Here are some other ways to combat the common fear of making the wrong choice (often ending in analysis paralysis):
- Remove the choice by automating your saving/investing.
- Give yourself a deadline.
- Remember that action is better than waiting for perfection.
- Consider the opportunity cost: for example, does that 0.05% better interest rate on your savings account really make a difference if you’ve spent 2 months searching for it? 🤷
🎧 Like this? Listen to that!
If learning more about your money mindset and behaviour interests you, then I’ve got some great podcast episodes lined up for you.
Want to start breaking down your limiting money beliefs? In this conversation, Owen and I chat to Tash Etschmann (@tashinvests) about 5 common beliefs that hold us back and how to overcome them.
Want to feel better about your money? In this great episode, Owen and I spoke to Emma Edwards (@thebrokegeneration) about how feeling better about your money leads to better money behaviour.
Finally, this two-part series (part 1 & part 2) with Claudine Chicheportiche (a high-performance money coach) unpacks whether you can actually win the money game, the psychology behind our money goals and getting out of the analysis paralysis trap.
Your challenge: Identify one of your limiting money beliefs, find a solution to work on overcoming it and then experiment to see what works!
Cheers to our financial futures,
Kate