An effective relationship with money can be easy (but not at first)

Fay Daisley worked with me for several years in different boarding houses and hospitality establishments. During the global financial crisis (GFC), I asked Fay whether she was worried about the financial situation. She told me she had nothing to worry about because she had no money.

On occasions when Fay received a bonus (including one substantial one), she immediately gave the money to family members who needed it. This was despite the fact she did not own her own home. She truly had an effective relationship with money in that it worked for her. Sadly, Fay passed away four years ago.

At the other end of the financial spectrum is Warren Buffet, who also appears to have a highly effective relationship with money. Despite his wealth, he has always lived a very modest lifestyle.

Having dealt with hundreds (if not thousands) of people over my working life, it is clear to me that there are three essentials to having a solid, effective working relationship with money:

1. Philosophy. What have we decided about money? We need to be clear on what money means to us, what we will do to get it, and what we won’t do to get it. Our money philosophy alters over our lifetime with our experiences, changing needs, and the influence of the community’s needs and expectations (e.g. income tax).

2. Psychology. What habits and beliefs are ingrained in us by genetics or experiences? Neuroscientists and psychologists tell us that the way we think about money and the things we do with it are governed by the way we are hardwired (i.e. they are preordained). If this is true, then we need to change our circuitry. Understanding our biases (good and bad) and our natural human tendencies helps significantly with the decisions we make about money (e.g. delayed gratification).

3. Practical. What strategies and tactics do we use on a day-to-basis to help us with income, spending and saving? In his book, Atomic Habits, James Clear says to create an effective habit, we need to ensure four things:

  • It is obvious.
  • It is attractive.
  • It is easy.
  • It is satisfying.

Everybody needs a personal money management system to cover their daily needs and an investment management system for savings. Likewise, business owners need a money management system for their businesses.

Using a financial planner, debt management expert or investment advisor is useful, but only if you are clear on your philosophy about money and understand your natural tendencies. You cannot abdicate your responsibility for money management by giving it to somebody else to worry about.

Taking money off the table as an issue makes life a lot easier. I will be hosting a webinar on Thursday, 16th July, to further explore money philosophy, psychology, and practical money management. You can REGISTER HERE. And if you have any questions, please email me at

Sign Up

Get the latest news and info straight to your mailbox.