Future Connect Event Shares Money-Mastery Tips

Timothy Townsend, Head of Wealth Management & Corporate Consulting at Alexforbes, posed an important question to our Future Connectors at our recent event, ‘Master Your Money Now and for the Future’ — what is financial wellbeing?

Financial wellbeing is about feeling secure and in control of your finances. It means being financially resilient, confident and empowered to handle whatever comes your way.

With the rising cost of living and external pressures, it’s more important than ever to gain control of your finances. These external challenges, combined with internal stresses, can make managing money difficult. Building resilience can help you maintain financial wellbeing despite these pressures.

Tim shared valuable insights on how to make good financial decisions.

He suggested breaking it down with key guiding questions:

1. Frame the decision clearly. What am I really deciding?
2. Align it with your values. What do I really want?
3. Explore creative alternatives. What can I do?
4. Gather useful information. What do I need to know?
5. Check your reasoning. Am I thinking straight?
6. Commit to follow through. Will I do it?

Understanding your financial behaviour is critical when making decisions. Consider the factors that influence how you manage money—society, religion, personal experiences and education all play a role. Ultimately, how you handle your money is often a reflection of how you treat yourself.

Tim also introduced five money-related storytypes. Which one resonates with you?

1. The Innovator – Focussed on the future, believing that opportunities to make money are endless. Innovators dislike strict budgeting and are more focussed on earning.
2. The Impulsive – Spontaneous and driven by emotions, impulsive spenders make decisions quickly and are comfortable with risk. Their focus is on spending.
3. The Enabler – Sees money as a tool to help others and do good. Enablers are more inclined to save, focussing on using their wealth for positive outcomes.
4. The Pacifist – Prefers to live in the moment and avoid the details of financial planning. Pacifists may borrow to keep up with expenses, rather than focussing on financial discipline.
5. The Architect – A natural planner who thrives on gathering information and making strategic decisions. Architects are future-focused and tend to invest their money.

Tim also emphasised the importance of budgeting and introduced different budgeting methods. An approach he suggested was the 50/30/20 model:

• 50% of your income should go toward needs, such as rent, bills, and groceries.
• 30% can be spent on wants.
• 20% should be allocated to savings.

Setting goals is crucial when budgeting. Regularly revisiting and tracking these goals ensures they remain realistic and achievable over time.

Tim briefly touched on the topic of investing, particularly sustainable investing. Increasingly, investors are considering not only the potential returns of investing but also the broader impact your investments might have on society.