Optimists are those to whom money has brought peace of mind while Money Masters enjoy conserving their money and are motivated by value.
Optimists are older investors who had successful careers and now want to enjoy the fruits of their labour.
They do not want to fuss about money and spend time on travel, hobbies, or other interests. While they do not spend emotionally, they are not saving to increase their asset base. They choose current income as their financial goal, followed closely by safety. Their concern is not to outlive their investments, yet they do not always know how to plan successfully to meet this goal.
They prefer to leave their financial affairs in the care of an advisor. They prefer to annuities for the security of their guaranteed income stream, but are also satisfied with investments like money market accounts, unit trusts, and government bonds. Optimists need to develop financial plans that require little effort, safety of capital and provide growth and income taking the combined effect of tax and inflation into account.
A unit trust investment portfolio consisting of the following should satisfy the risk tolerance of Optimists: Domestic-Fixed Interest-Money Market & Bond Funds, Domestic-Real Estate-General Funds, Domestic-Equity-General, Growth and Value Funds.
Kathleen Gurney: “One of the financial personality types, whom I call the Money Masters, said that if they lost all their money for some reason, they wouldn't be very anxious, because they would just do it over again.”
Money Masters are very practical and pride themselves in making wise investments. They feel best when they are involved in managing their money.
They have managed to strike the perfect balance of self-confidence, risk-taking, trust and acting on sound advice. They accumulate the most assets of all of the investor personality types. They care very little about prestige or influence over others. For them, money is more a means to an end than a measure of self-esteem.
Money Masters have the most diversified portfolios, and are very satisfied with their investments. They desire safety of capital with a high degree of growth and income. Money Masters are quite effective at handling their own affairs. Advisors can be useful providing research and a second opinion.
A unit trust investment portfolio consisting of the following should satisfy the risk tolerance of Money Masters: Domestic-Fixed Interest-Money Market & Bond Funds, Domestic-Real Estate-General Funds, Domestic-Equity-General, Growth and Value Funds.
Some financial advisors/planners may differ with the approach to link investment portfolios to money personalities. The greatest value of money personalities is to know your money habits.
Dr. Kathleen Gurney, Ph.D. founded The Financial Psychology Corporation®, www.kathleengurney.com. She developed the Moneymax® profile which formed the basis of her book, Your Money Personality: What it is and How to Profit from It. Doubleday. Hugo Snyman is the founder of Third Circle Asset Management (Pty) Ltd. With his permission I have access to information from the websites http://www.ips-online.co.za/ and http://thirdcircle.co.za.
If you are not any of the money personalities mention thus far, you might be a Producer or Entrepreneur.
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Until next time.