When it comes to advising our clients, understanding their short- and long-term goals and perspectives about money is an integral part of our process. But how much does it really matter? Doesn’t everyone essentially want the same things when it comes to their money?
In our five-plus decades of experience, we’ve learned that the answer is no, they don’t. Individuals’ money-related goals, the reasons behind them, and the investment decisions associated with them can be—and often are—very different. What’s more, those goals can differ between spouses, within a family, and even with changed circumstances over time in the same person.
Money is personal, and so is investing. Finding comfort, security, and even excitement in your investment decisions comes with understanding your own preferences and the driving forces in your life. No matter how much you know or don’t know about investing and the markets, one thing is certain: you have a distinct investing personality, and that personality affects the financial decisions you make.
To create the best possible experience for you, you need to understand that investment personality, so you can ascertain the forces that drive you and guard against tendencies that might, counterintuitively, threaten your goals. We call your investment personality your MoneyMind, and we use Goldman Sachs’ FinLife system® to help clients identify theirs.
What is a MoneyMind?
So what, exactly, is a MoneyMind, and how can you understand yours? Most simply, your MoneyMind reflects the primary influences in your life as pertain to your views on money. The three MoneyMinds are Commitment, Protection, and Happiness. Here’s what that means.
Those with a commitment-focused MoneyMind derive joy from giving, and they’re afraid of letting others down. For these individuals, supporting the people and causes they care about is a priority. As a result, these types of people may be more risk-averse, they may be more concerned with others’ opinions of their decisions, and they may even put off their own financial needs to support their loved ones.
Those with a protection-focused MoneyMind prioritize security and peace of mind above all. They’re typically very cost-sensitive and have no problem delaying gratification and living well within their means. These types tend to focus on saving and creating a comfortable safety net, and they may be more apprehensive about taking on financial risks.
Those with a happiness-focused MoneyMind thrive on living life to the fullest—and sometimes that means they live beyond their means. These types may value near-term rewards vs. long-term planning, and the result of this mindset could be an underfunded safety net. Happiness types may be more comfortable with risk, which can lead to opportunities, but that risk appetite may also need to be tempered.
What Your MoneyMind Means for Your Financial Planning
By understanding your unique blend of traits, we can work with you to help you develop your goals—and protect against some of the pitfalls that might be unique to your MoneyMind. As a result, our goal is to offer personalized financial planning and advice that celebrates your unique vision and makes you aware of your unique blind spots.
Money, like personalities, goals, and perspectives, is personal. When you understand how you personally feel about your money and your investments—and when you share that knowledge with your financial advisor—you can start on a path toward making financial decisions for you.
We’re here to help. Take our exercise to identify your unique MoneyMind, then reach out to have a conversation with an advisor whose goal is to learn and understand your lifestyle, priorities, and objectives.
United Capital Financial Advisers, LLC d/b/a Goldman Sachs Personal Financial Management (“GS PFM”) is a registered investment adviser and an affiliate of Goldman Sachs & Co. LLC and subsidiary of The Goldman Sachs Group, Inc., a worldwide, full-service investment banking, broker-dealer, asset management, and financial services organization.GS PFM is not affiliated with Kimelman & Baird, LLC. All names, logos, and slogans identifying United Capital and United Capital’s products and services (including, without limitation, HonestConversations®, MoneyMind®, FinLife®, Financial Control Scorecard®, Live RichlySM, We Help You Live RichlySM, Helping People Live Richly®, One Best Financial Life®, Ideal Life Index®, GuideCenter®, InvestmentViewfinderSM, United Capital Financial Life Management®, and Financial Years of FreedomSM) are trademarks and service marks or registered trademarks and service marks of United Capital or its affiliates in the United States and/or other countries.© 2020 United Capital Financial Advisers, LLC, a Goldman Sachs Company d/b/a Goldman Sachs Personal Financial Management. All Rights Reserved.