The MQ Type Assessment evaluates your mindset, behaviours and results when it comes to making and managing money. Essentially personal financial management is about money coming in (income) from work or investments and money going out (expenses) to pay for bills. What you are left with is savings which you can they use for investments to build your wealth.
Income - Expenses = Savings
A Breaker Shaker is someone who limits their ability to generate income but also spends what money they have without much thought. They break the flow of money to themselves and they tend to shake off/ spend money on short-term consumer adventures. Breaker Shakers tend to be laid back in their career with a focus on the other pleasures of life. Money comes but money goes, never stays for long. The short term focus for a Breaker Shaker should be to get their expenses under control and their medium term focus should be to increase their income.
As a Breaker Shaker, money seems to burn a hole in the pocket. Sometimes it is referred to as a “Champagne lifestyle on a beer income”. Breaker Shakers tend to pay more than they can afford to live where they want to live, if they have a mortgage they may have extended themselves, they tend to spend more on a car then they should, they eat out more often then they can afford, and they spend more on holidays then they should. If they are a woman they probably spend more than they should on their fetish(es) be they clothes, shoes, bags or cosmetics etc. If they are a man then they probably spend more than they should on their hobby(ies) playing some game/ sports or toys (eg. boats, cars etc). They could even be going backwards by going into credit card or personal debt.
This “party” could go on as long as they have work income. What will happen when they retire and they don’t have enough investments to retire on? Will they be able to live on the government pension (as at March 2018 it’s $907.60/fortnight for single pensioner and $1368.20/fortnight for couple)?
What is missing is discipline. The first and probably most important thing Breaker Shakers need to do is get their finances in order. They could start by creating a budget that covers the 9 key expense areas every budget should have. If they are in debt then they could start by looking at any non-essential/ discretionary expenses that they could reduce/ remove and pay off their consumer debts. They could do their preparation, create a list and set themselves a limit before they go shopping so they don’t make impulse purchases. Set up their finances so their bills are paid in a timely manner and avoid late penalties. If all of this seems too daunting then they should get some help, team up with a Maker Manager and a Money Mentor and create a Winner Partnership (M3).
Breaker Shakers should be careful who they get advice from. They should find a money mentor practices what they preach. They will have a much deeper understanding of the wealth creation journey.
Breaker Shakers are not going to be able to do much to build their wealth until they get their finances in order and get out of survival and can save a bit. They could also create an automatic savings plan so that some money is diverted away where it is hard for them to access and can be invested into income generating assets for retirement. The way western governments are going they won’t be able afford to pay the pension with their deficits. To be able to retire without having to live on the pension will mean that Breaker Shakers will need to generate passive income from assets. As a rule, in Australia they will need around 20 times your desired retirement income in net assets excluding their home. Maybe retirement seems a long way away for them. Thirty years is not a long time to build their wealth. Ideally they want to start in their mid 30’s to give themselves a measured approach.
Some big questions for Breaker Shakers are "Do you enjoy your current career?" , "Can you really spend the next 20 or 30 years doing something you don’t enjoy?", "What is the cost/ impact of that on your health, soul and peace of mind?", "Would you be better served doing something you are more passionate about?". The opportunity here for Breaker Shaker is to find a way to prosper from their passion. There are probably some ways they could leverage the knowledge, skills and experience from their current career to transition over to something they are passionate about.
For Breaker Shaker to be able to retire without having to live on the pension will mean that they will need to generate passive income from assets. As a rule, they will need around 20 times their desired retirement income in net assets excluding their home. The way western governments are going they won’t be able afford to pay the pension with their deficits. If the Breaker Shakers current job provides them with a decent income and they can put up with it then they should look to divert a percentage of their income to invest in assets. If all of this seems too daunting then they should get some help, team up with a proactive Money Maker and a experienced Money Mentor and create a Winner Partnership.
The most important thing for a Breaker Shaker is to further their financial education and increase their money intelligence.