Studies show that, after the age of 25, people start to reflect and break cycles. This is also the time when they tend to earn consistently and question long-held beliefs about money.
According to financial literacy expert Patrick Wameyo, human beings are shielded from taking responsibility until they become adults. However, he says that those without parents or those whose parents do not have a source of income take responsibility much earlier, sometimes at 17.
“In the village, people take responsibilities very early, for instance, farming. Generally, an adult who is 18 years old can take care of themselves,” he says.
And as responsibilities increase, so does awareness around money decisions, yet many financial struggles, he notes, begin much earlier in life.
He said that the early phases of life involve learning by observing and by what people are told.
“Traditions and beliefs are picked from your environment of nurture. If money beliefs are being practised in your environment, you pick them as they are and question them later,” he says.
These early beliefs tend to solidify by early adulthood, beginning at the age of 24, he says. After that age, people then question the foundations of those beliefs, with culture as a product of beliefs and traditions.
He states that rewiring financial habits, even after years of bad decisions, is possible but needs personal conviction and a shift in mindset. New information can also help you shift beliefs and adopt new financial habits, he adds.
Anytime you begin to earn money consistently, Patrick says, you have to reassess financial behaviours.
“You build habits around the four areas of money, which are earning, saving, spending, borrowing and investment,” he explains.
He notes that it is not the amount of money that guarantees financial stability but the behaviours you pursue. Financial literacy is making responsible financial choices.
“Financial habits are built and perfected daily, weekly and monthly. It is about how you earn daily and how you spend daily, and that awareness brings better choices. As you spend, make sure that you save,” he says.
One of the challenges adults face is emotional spending, and moving toward intentional spending starts with self-understanding. He states that people either operate from the emotional or logical side of the mind, and they should assess traits to note which side they use more.
“If you find you are more emotional, build muscles for logical choices and reduce emotional decisions,” he advises.
For those who feel financially behind, he emphasises taking action and getting a new set of behaviours. Discipline, he adds, is what makes success possible by allocating money to intended avenues every time.
Breaking cycles such as debt dependence or living pay cheque to pay cheque also starts with assessing yourself and reducing previous behaviours and their drivers.
“That eliminates debt and careless giving, allowing you to retain more money and direct it toward repayment,” he says.
Financial planning, meanwhile, should always help you envision an objective such as long-term wealth building. The plan, he says, aligns behaviours that enhance savings, investments and earnings and further motivates discipline and objectivity. Aligning money habits with desired life outcomes mainly involves the plan.
He notes that early investment decisions have the greatest long-term impact. If you invest today, the asset’s value grows over time, and as the environment changes, so does its value. Financial literacy, he says, is knowledge, skill and confidence.
For anyone seeking financial transformation this year, Patrick suggests reviewing where you are to know what needs to change.
“New actions are propelled by changing beliefs. Then come up with a financial plan. The life you want is provided by the financial plan,” he says.
