Animals hold a special place in the hearts of many around the world, and their fascinating behaviours have long been a source of wonder and inspiration.
Indeed, Popular Mechanics reveals that “biomimicry” – the practice of applying nature-inspired designs to solve human problems – has shaped everything from technology, fashion, and even architecture.
Beyond their universal appeal, animals’ instincts and strategies often reflect effective approaches to managing wealth. From planning ahead to adapting to change, they offer valuable lessons that can inspire smarter financial decision-making.
So, with International Animal Rights Day approaching on 10 December, read on to discover some of these fascinating parallels.
1. Squirrels and diversification
It’s fair to say that squirrels are master planners. An intriguing report from Scientific American found that a single squirrel can bury up to 3,000 nuts in a season, dispersing them across dozens of locations in a behaviour known as “caching”.
This ensures that they’ll have enough food to last them through winter, and even if a rival squirrel steals one of their stashes, they’ll still have more elsewhere to keep them going.
This is the perfect analogy for diversifying your wealth. Diversification involves spreading your investments across various sectors, asset classes, and geographical areas to protect your portfolio from volatility.
So, if one sector performs poorly, gains in another may offset your losses.
It’s important to note that diversification doesn’t completely eliminate investment risk. Yet, data reveals the value of this strategy.
For example, the asset quilt below highlights the performance of several asset classes between 2013 and October 2024:
Source: JP Morgan
As you can see, performance varies greatly across the different asset classes. If you’d solely invested in commodities in 2023, your portfolio would have likely seen a decrease.
Meanwhile, if you had spread your risk and also invested in the MSCI World Growth Index at the same time, this could have offset the losses from commodities.
Just like squirrels, diversification can help ensure that you have the resilience to weather “financial winters” (or, in this case, periods of short-term volatility).
2. Tortoises and steady progress
As admirable as they are, tortoises aren’t winning any sprints anytime soon. In fact, Guinness World Records reveals that the fastest speed achieved by a tortoise was 0.28 metres per second (or around 0.6 mph) by Bertie in the UK in 2014.
Yet, despite their slow speed, tortoises are undeniably persistent (living up to 150 years), and certainly achieve the ultimate goal of all life on Earth – to live as long as possible.
Investing and managing your wealth is much the same. Chasing quick returns to satiate instant gratification might just lead to disappointment. Meanwhile, focusing on your long-term goals and steadily progressing towards them could help you accumulate wealth over time.
You may even feel tempted to follow trends or act on media “noise” regarding the latest rising star of the market. But, in reality, this could simply end up derailing your progress towards your goals.
Even emotional biases, such as a “fear of missing out” (FOMO) or confirmation bias, could mean you make knee-jerk reactions to short-term volatility, ultimately leading to poor decision-making.
It’s worth remembering the story of the tortoise and the hare – the hare, while incredibly fast, became overconfident and was easily distracted. Meanwhile, the tortoise maintained a slow and consistent pace, eventually winning the race.
A long-term strategy could also help you stay the course, even during periods of volatility. It is a marathon, not a sprint, after all.
3. Meerkats and risk awareness
Native to the savannahs of Africa, meerkats face numerous predators that threaten them on a daily basis.
To protect themselves, they’ve developed an ingenious system – while some forage, one acts as a sentinel, scanning for danger and warning the rest of the group if threats arrive.
This collective vigilance and awareness of the risk around them has helped meerkats to thrive in such a hostile environment.
This approach could also underscore the importance of risk awareness in financial planning.
It’s vital to remember that risk is an inevitable part of financial planning, whether you’re managing investments, preparing for retirement, or protecting your loved ones from the unexpected.
However, understanding and managing this risk could make the difference between falling victim to predators, and thriving.
For example, if you take on too much risk when you’re investing, you might experience considerable losses if the markets don’t perform as well as you expected. Conversely, take on too little risk, and you could miss out on opportunities for growth, leaving you with a shortfall later in life.
Even other areas of your finances require proper risk management. If you believe you don’t need an emergency fund, for instance, you may end up having to rely on high-interest debt to cover any unexpected costs.
Ultimately, it’s essential to act as a sentinel to risk. Periodically assessing your situation could help you determine whether you’ve taken on adequate levels of risk with your finances.
4. Bees and holistic planning
Bees are renowned for their highly organised hives. Each bee has its own specific role, such as cleaning, foraging, or nursing, but despite their individual tasks, they operate as one cohesive unit and focus on their ultimate goal: to ensure the queen thrives.
Your financial plan should ideally work in the same way. A holistic approach considers all aspects of your financial life – from your savings, investments, protection, retirement planning, and more – aligning them towards your overarching goals.
This “top-down” approach could create an accurate overview of your wealth, which you can then use to reach your life goals and achieve peace of mind.
For instance, cashflow modelling could provide a detailed understanding of your financial situation by projecting how your income, spending, and savings change over time.
Then, you could use this information to assess whether you’re on track to achieve your long-term goals, such as retiring comfortably or purchasing a new home, while also preparing for any unexpected events.
This could provide some much-needed peace of mind that you’ve considered your entire situation and help ensure you remain on track to achieve your end goals. Like the well-run beehive, a balanced financial plan can foster stability.
5. Beavers and working with a professional
Beavers are amazing animals that transform their environments by building dams, digging canals, and constructing intricate lodges.
These structures benefit entire ecosystems, as they create wetlands that support biodiversity, improve water quality, and reduce flooding.
Much like beavers are often referred to as “ecosystem engineers”, you might also consider your planner as a “financial engineer”.
In the same way that a beaver assesses a river and decides on the best course of action, a financial planner considers your unique circumstances and designs a bespoke financial plan tailored to your needs.
Beavers also strengthen their dams to withstand seasonal changes, just as your planner ensures that your financial plan remains resilient through market fluctuations, economic shifts, and significant life events.
Get in touch
If you’d like to build some of these helpful habits from the animal kingdom into your financial plan, then we can help.
Email us at hello@vwmwealth.com or call us on 0141 229 4004 to find out more.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.
The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
The Financial Conduct Authority does not regulate cashflow planning.
