I was sat in an MDT meeting yesterday, and I had a sudden realisation – how I manage my money is how exactly like how an MDT runs and I wanted to tell you about it (yes, I am always thinking about you and your money!).
For those of you who are not familiar with the term MDT – it stands for multi-disciplinary team, and it is a way of collecting together professionals from a number of different disciplines to talk about the care of patients.
In cancer departments for example, the MDT could consist of an oncologist, an oncology nurse specialist, a cancer-surgeon, a radiologist, an occupational therapist and a dietician. All of these people would have an impact on how the patient was managed through their cancer treatment. At the end of the meeting, every person has a list of jobs to do and can then action them by booking appointments, applying a treatment etc. It makes the whole process MUCH more efficient and better for patients.
How Does This Relate To Money?
It got me thinking that money is so much more than budgets. Money management is a collection of elements that make it work for you – a bit like a jigsaw puzzle fitting together.
This jigsaw puzzle is like the MDT. You have saving, investing, frugality, spending, mindset, budgeting, giving and forward planning all coming together to generate what is essentially a tailor-made blueprint that is uniquely you.
The trick is to get the balance right and know what you want to achieve!
An MDT doesn’t work without key members. A cancer MDT would be pretty pointless without an oncologist because the patient wouldn’t get treated properly. A psychiatry MDT would be directionless without a psychiatrist. If an MDT consisted only of physiotherapists, then vital elements of a patient’s care would be missing, and the whole system falls apart.
The same goes for your money.
We all have a certain style of managing our money. Some people seem to have it right, and have built up loads of savings. Some people (like me), got it wrong, got into debt, and are now putting it right.
The thing is, there is no “one size fits all” approach when it comes to MDTs and Money. Different patients need different solutions, and therefore different MDT members to help.
So here are some ways that being out of balance can affect your money and your mind (and perhaps what you can do to rebalance).
Out of Balance: Saving
The person with a lot of savings might look great on the surface, but when going behind the scenes, they have the mindset of scarcity. They believe that they NEVER have enough money, and so hoard it.
It’s not a bad thing, because it keeps the person safe, but it keeps the person stuck too. Their mindset keeps them rooted to the ground like a well-established oak tree.
Where is the fun spending? Where is the investing?
Whether we like it or not, money devalues over time (due to inflation), so it MUST be given a way to try and beat this erosion process to be ready and waiting for us when we need to use it. One way could be to invest in stocks and shares.
How To Rebalance – Work On Your Mindset
This takes courage and a mindset shift away from holding on to money tightly, and trusting that there will always be enough. My suggestion is to dip your toe in, and start directing 5-10% of your income for fun things (whatever floats your boat), and 5-10% of your income towards investing. I’ll be talking more about this in my upcoming free webinar “How To unleash Your Inner Investor, Even If You’re Broke And Can’t Be Arsed To Read The Financial Times“. It comes with a tonne of additional freebies, including a free 3-day video training on net worth, so definitely a good idea to jump on board!
Out of Balance: Spending
Spending comes in a few forms – you could be a frivolous spender, and have a wardrobe full of clothes, or you could be a maverick spender – someone who chases after the next “big thing” to make them money. I’ve been both of those types of spenders.
The problem is, when money is being directed into these things, it could be contributing to a debt hole, and/or stopping you from putting money into investments that *actually* work.
Both spending habits also come from a place of scarcity and lack, but from a different angle. The frivolous spender might be pulled into the “got to have it now before it goes” mentality, and the maverick investor might be thinking about their lack of money and wanting to use investing to try and repair their problems.
How To Rebalance – Have an Emergency Fund and Avoid Your Triggers
To avoid the “shiny object” trap, (quite literally!) you need to get to the root of why the balance is skewed that way. For me, it was a feeling of rebellion with spending and doing whatever I wanted to feel “free” (which ironically has actually imprisoned me temporarily), and then to try and work out ways to get out of it quickly (which backfired and made things worse!).
The key is realising that there are no short cuts – only consistency and discipline to continue on a strategy that works.
If you’re an over spender – what triggers you? Is it a certain shop or a bad day at work? Start noticing these patterns, because then you can avoid them. Honestly, you won’t get it right every time (I still mess up), but an AWARENESS of what you’re doing is how you break the habit.
And finally, while there is nothing wrong with investing in something that is a bit “out there”, in order to keep yourself safe, it won’t hurt to have an emergency fund in place. Build this up and only invest what you can afford to lose. Your safety net will be there if things don’t work out as planned.
Bottom Line: What Is Uniquely You?
To get the balance right, as in the case of an MDT, you might need to make some major adjustments and bring in different money management roles to help. Only you know what this is.
Where are you over-doing it, and where could you do more? What is missing from your “team”.
Money management systems can come across as quite rigid. I read a blog post the other day about someone’s opinion of Dave Ramsey’s baby steps, and his critique was that it was a “one size fits all approach” that works for a lot of people, but does need to be tweaked for others.
And this is ok! Some people need more money coming in, some need to spend less. Some people need to start investing. We all have different savings goals at different times in our lives. It’s all normal. But whatever you do first, you need to do some work to achieve what you want financially. Sometimes there is merit in going back to basics and learning a system to get you started.
And another thing – don’t forget to be compassionate with yourself. You’ll have plenty of things that you do well to praise yourself with, and make sure you do! This is not all about the less-so-good stuff!
Now over to you: Which elements of your “Money MDT” are missing? What are your next steps to redress the balance?
Good luck on your lifelong money journey! Come and find me over in my Facebook community!