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You Had Me At Aloha

John Bolton is the latest recruit to our Marketing Team, having joined us in February. John was keen to learn what makes the company tick, so we let him loose on our Chairman, Andy Jervis, with a recorder and a notebook. Following Andy’s reflections on what the company stands for, John asked Andy what has influenced the development of Chesterton House into the company it is today.

A significant influence in my development as a Financial Planner is a book called The Seven Stages of Money Maturity, by George Kinder. It's a fascinating book which describes the process of personal growth in the context of money, from early "Innocence", through each stage towards "Aloha" - a state of harmony and equilibrium.

Let's go into a little more detail on each of these seven stages:


Firstly Kinder describes "Innocence", which is more often than not displayed by children. For example:

"Where does money come from Dad?"

"It comes from the cash machine".

Innocence is a place of not knowing and not caring about money. Dad has not lied, but neither has he mentioned the work of creating money, what money is, and how it got into the machine in the first place - all vital parts of the picture. Probably because the father knew the child would have wandered off and engaged in something more stimulating, such as annoying his little brother.


Eventually though, the child realises that there are things he needs to know about money. Whether it be an 11-year-old being told they don't have enough pocket money to buy a certain toy that all their friends have, or a 20-year-old borrowing money they know they cannot afford to pay back, they come face to face with the second stage of money maturity; "Pain". There is a problem that they need to solve. They need information.


When you experience Pain, you can either decide to shrink from it, or go through it. On the other side of Pain is "Knowledge".

The 11-year old starts to learn about earning money, and that work is required. The 20-year old realises that they need to know about borrowing, interest rates, repayment periods and obligations. Learning about where money comes from, how you earn more money and the importance of saving are skills required on your journey towards Financial Freedom.


So you begin to gain the knowledge. But knowledge without experience doesn't lead to wisdom, it is the practical application of knowledge that matters. And so, we move on to the fourth stage; "Understanding". You can read all about loans and how they work, but until you have been through the process of applying, agreeing and accepting one you'll never truly understand the concept.

Along the way you will experience various emotions that will leave their mark on you. This stage is about accepting the emotions (felt in the "Pain" stage) that naturally play a part in learning about your feelings towards money, such as doubt, envy, resentment, greed and regret.

Having decided to gain knowledge, and now on your way to understanding, you begin to feel energised. You're gaining control.


That sense of control is reassuring, it helps build confidence. You begin to open up to the possibilities and opportunities available to you. That is when people start to build careers, businesses and projects.

"It is vain to say human beings ought to be satisfied with tranquillity: they must have action, and they will make it if they cannot find it." Charlotte Brontë

Your new-found energy is built on the knowledge and understanding that preceded it, and it's fun! You're engaged in life.


The penultimate stage of money maturity is "Vision" which is when you start to see where you are in the world and where you fit in. It's about the vision to create and contribute, whether that is building a great enterprise or being a valued member of your family or community.

"The wise who are trained and disciplined shine out like beacon-lights. They earn money just as a bee gathers honey without harming the flowers, and they let it grow as an ant-hill slowly gains in heights. With wealth wisely gained, they use if for the benefit of all." Digha Nikaya, Translated by Gil Fronsdal


The final stage is a Hawaiian word George Kinder uses, "Aloha". Kinder describes this stage as, "the giving and receiving of blessings without being diminished". It's being able to make gifts to people and growing as a result. Equally, people often have trouble receiving gifts, and feel obliged or indebted by simple gestures. Aloha is receiving with grace, and acknowledging both your own worth and the noble intent of the giver. You are in a place which is fundamentally secure, where money has its place but it isn't the driver of your behaviour.

It's important to recognise that the Seven Stages are not a linear process, in reality people can bounce around the levels at different times and with different issues. Each new learning begins the process anew in its own way.

I have found this framework helpful when working with clients and helping them to understand their own views and attitudes, and especially as a guide to dealing with children and money. It is a parent's natural temptation to take the money Pain away from their children, if they are in a position to do so - and often even if they are not. But does removing the Pain - of saving, budgeting, planning - help the child?

Wealth, and the proper management of it, is the route to freedom. But like anything worthwhile, it takes work, and work takes time.

There is nothing wrong with wealth, provided you're not too attached to it. If your wealth defines you as a person, then you're going to have trouble. My goal with clients, by working with them, is to build their wealth to a point where they can experience the three freedoms, but to ultimately get to a position where they can let go of it - as we all must eventually do.

If you enjoyed reading this article, you may also like Is Your Money Safe?


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