Doing well with Money isn't necessarily about what you know.

It's about how you behave.

And good behaviours are hard to teach, even to really smart people.

Money - investing, personal finance and business decisions such as insurance - is typically not taught at all, or maybe as a maths-based field where data and formulas tell us exactly what to do.

But in the real world most people don't make decisions on a spreadsheet.

They make them at the dinner table, in a meeting room, or worse still on a golf course or in a bar where personal history, your own unique view of the world, ego, pride, personal relationships, marketing and odd incentives are scrambled together.

Award-winning author Morgan Housel explains;

Your personal experiences with money make up maybe 0.000000001% of what's happening in the world, but maybe 80% of how you think the world works.

The truth is, people make crazy financial decisions.

Here's the thing...

People from different generations, raised by different parents who earned different incomes and hold different values, in different parts of the world, born into different economies, experiencing different job markets with different incentives and different degrees of luck, learn different lessons.

Everyone has their own unique experiences of how the world works.

What you experience yourself is more compelling to you than what you learn second-hand from books, blogs or me!

So, all of us go through life anchored to a set of views about how money works - this varies wildly from person to person.

Ideas, beliefs and attitudes toward money we inherit from our personal past or from society impact our current relationship with money.

What seems crazy to you might make sense to me.

The person who grew up in a poor family thinks about risk and reward in ways the child of a wealthy family cannot fathom if they tried.

We all have internal 'scripts':

Beliefs and paths we develop in close and formative relationships, especially during our childhood.

And external 'scripts':

Beliefs and paths we inherit from society. Perhaps the biggest is what 'retirement' is or could be.

These tend to be developed subconsciously or passively and we are largely unaware of how they impact us.

The list of possible experiences or 'money-minds' is endless.

Ultimately, it's worth remembering that all successful investing of any type is goal-focused and planning-driven.

All failed investing is market-focused and current-outlook driven.

Successful investors act continuously on their plan. 

Failed investors react continually to the markets, and always the wrong way - that's just human behaviour!

What I would suggest to be good or 'real' advice is the opposite to conventional thinking; ignore the news, never listen to a forecaster, don't mix finance with friendship and a private banker is NEVER actually on your side.

We must accept that what a caring, empathetic investment counsellor states is going to be counter-cultural, if not counter-intuitive.

As Morgan Housel explains, human nature's first instinct will be to think the opposite of what a firm like AES believes, even when they're strongly supported by Nobel prize-winning evidence and over fifty years of academic research...

I have therefore chosen to share an article from the Scientific American titled 'We Learn Faster When We Aren't Told What Choices To Make'.

In a perfect world, we'd learn from success and failure alike. Both hold instructive lessons and provide much-needed reality checks that may safeguard our decisions from bad information or conflicted advice.

Alas, our brains don't work this way. The stark truth is that biased thinking runs deep in the human psyche.

In other words, while our brains do exhibit certain biases, our brains also appear to be hard-wired to learn effectively from those biases, which may not always produce the 'right' outcomes.

From a practical perspective, the key insight is simply to recognise that if you want someone to learn something, it's not enough just to guide them through the motions - steering them towards the 'right' choice and letting them experience the outcome - but instead empowering them to make the decisions themselves and then getting out of the way, which both contributes to the learning process and makes it more likely for them to actually adapt their future behaviour based on the learned outcome!

When it comes to business innovation, it's not enough to have a great idea; for it to be successful, the idea must be shared, promoted and bought into across the organisation. Yet in practice, most businesses focus far more on the creators of these great ideas (the so-called 'visionary geniuses'), and not enough on the 'butterflies' that actually propagate the ideas into action.

This is important, because it means that not only do 'smarts' matter in the hiring process and the building of teams, but also the social skills of the butterflies that help ideas get disseminated.

In his book 'The Secrets Of Our Success: How Culture Is Driving Human Evolution, Domesticating Our Species, and Making Us Smarter', author Joseph Henrich highlights how it's really the cultural infrastructure of an organisation to share, teach and learn (not just ideate) that actually determines success; after all, if an organisation has a strong enough social culture, it actually takes very few geniuses to create new ideas, and they can still propagate quickly and be adopted by all.

In the end, this doesn't mean that 'smarts' aren't important and that a business doesn't need people to innovate.

But when the social fabric is strong and there are many butterflies in the business as well, it's far easier for the few ideas that matter to get around much more quickly and have a real, positive impact.

As always, and true to my own military roots, the final word is taken by former senior British Army officer, inspirational leader and Ironman champion David Labouchere on 'Consistency'. Life is a marathon. Having run 37, David understands this better than most!

Consistency is a key tenet to success in most aspects of it and David discusses what rituals help us think, talk, listen and laugh a little more.

A question for you

Think about your upbringing:

Were your parents good with money? Did they share a similar approach to family finances? Did they fight about money?
Did you see anyone lose everything, or grow very rich?
Did anyone teach you about money, or did you learn it on your own?
When you opened your first bank account, did you do it with a family member? Or on your own, when you had your first job?
What social class did you grow up in? What were the habits and behaviours you saw?

Having thought about those, consider:

What are the consequences on your current attitudes and behaviours?
Are you a careful saver, or carefree spender?
Do you take big risks, or do you play it safe?
Do you have your goals meticulously mapped out and planned for, or will you just see how it goes?
Why do you have the goals that you do, things like a new home or an early and comfortable retirement?
Do you always seem to want more, or can you (and do you) feel content?

What are you going to do consistently to improve your physical, mental and emotional health and happiness from today?

This week's meditation

"I would maintain that thanks are the highest form of thought; and that gratitude is happiness doubled by wonder"
- G.K. Chesterton

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Have a great weekend, stay safe, stay sane, be grateful and enjoy the ‘light’ reading! 

Michele Solis' article 'We Learn Faster When We Aren’t Told What Choices to Make'

Joseph Henrich's book 'The Secret of Our Success: How Culture Is Driving Human Evolution, Domesticating Our Species, and Making Us Smarter'

David Labouchere's article 'Consistency'