Generally speaking, and according to the Cambridge Dictionary, a mindset is defined as a set of established beliefs, attitudes and opinions that a person adopts about themselves, issues or life in general. Most of us don’t really take the time to know much about our mindsets and how this influences our behaviours and subsequent reality. Why is this important? How we view our lives and how we make sense of it has long lasting effects on us, but we don’t interrogate these closely. It is dangerous to be blind to the mindset that we have about finances. Our financial mindset leads to our financial realities.
Most women are often too busy thinking about putting food on the table, creating careers, looking after families and others to be able to create time to think and reflect on the financial decisions we make and whether they serve our greater financial goals and dreams. We make financial decisions based on current needs and sometimes impulse, and maybe even to financially soothe ourselves as a coping mechanism. Others choose to even leave those decisions to partners and spouses in the hope that they will make the right financial decisions on their behalf. There are a group of women who are very aware of their financial mindsets and have learnt that being deliberate around financial decisions start with our mindsets. What better way to practice self-care than to meaningfully know your financial needs and deliberately work towards them? Taking full accountability for your financial health.
What better way to practice self-care than to meaningfully know your financial needs and deliberately work towards them? Taking full accountability for your financial health.Lindiwe Monyae, Executive (Emerging Consumer Market), Liberty
There are no perfect recipes here nor full proof solutions however, we can all start the journey and learn and grow as we move through it. Importantly, when things go wrong, we should be able to start afresh, self-correct and move forward. Here are my few reflections on my financial mindset journey:
- As a person and woman, I deserve to have a healthy financial life, no matter what my background and circumstances are.
- I need to think about my financial goals and plan towards achieving them.
- I don’t need to know everything about all things finance, I can reach out to an adviser, financial experts, literature and trusted websites to empower myself.
- It is OK to have setbacks in my financial goals, but I should always strive to move forward and not give up on them.
- I must make it a practice to review my finances and get professional advice on my risk, savings and investment needs.
- There is nothing wrong with rewarding myself with what I like, love or want as long as it is planned and not on impulse.
A financial mindset is important for all age groups and even more important to develop at our earlier life stages than later. Habits get entrenched over a period and they become automatic with time. We could use this process to build a strong financial mindset and positive financial habits earlier on. For the average person, we do not have loads of spending amounts or investments waiting to mature. We start from a very low base where we get stipends, some spending money or a little income from our family structures or early work engagements. As we then grow in our careers, we start getting exposed to more income and broader financial needs and goals.
As young women, we have so much that we want to achieve, a healthy financial mindset sets us up to be achieve our long-term goals, while learning the financial ropes along the way.Lindiwe Monyae, Executive (Emerging Consumer Market), Liberty
I remember as an Honours student at Wits, I received a monthly stipend from my parents and a quarterly stipend for being a Tutor. This was a significant source of income at the time. Already at that point, I needed to be clear around the monthly budget for food and toiletries and entertainment. I needed to make decisions of how much I spent on clothes, take outs and what would carry me through for the month. A financial mindset was already required here in making decisions on not creating unnecessary debt, understanding needs (food, school books, transport money, cellphone/data costs etc.) and wants(branded clothes, nails, make up, hair pieces), instant gratification vs medium term financial planning. Already at this point, I needed to think about saving for holidays, for a car, for a house deposit. As young women, we have so much that we want to achieve, a healthy financial mindset sets us up to be achieve our long-term goals, while learning the financial ropes along the way.
I am sure that, as you start your own financial journey, you will find more lessons relevant to you and your life. A positive and deliberate financial mindset is important, and it could be the change you have been looking for. As we celebrate women’s month, please reflect on your mindsets, keeping in mind that self-care tops our needs and financial freedom is worth seeking no matter what situation we are facing right now.