A money mindset is your unique set of beliefs and prevailing attitudes towards money and your finances. This money mindset drives what you do with your money and how you think about money. It’s a reflection of your daily financial decisions and the achievement of your long-term goals.
Your money mindset impacts the trajectory of your life, and whether you are conscious of it or not it can be a blessing or a curse.
Where do you get your Money Mindset from?
A person’s mindset on money has a lot to do with how you were raised and the environment you grew up in. The biggest influence would come from parents, family members, neighbors, friends, classmates, etc. Directly or indirectly these influences came about but are not limited to conversations about money, views, opinions, stories of success & failures and, experiences.
- Words that leave an impact- The Classics
- Money can’t make you happy
- Money is the root of all evil
- Money doesn’t grow on trees
- We can’t afford it
2. Common Practices- that leave an impact – Depending on your perception things can go positively or negatively.
- If you were raised in a household where your parents are comfortable with debt
Positive: You are not afraid to take a calculated risk investment. Negative: You follow the practice and sink into debt.
- However, if you grew up in a household where debt is not an option (except for mortgage) and cash and savings are the goals.
Positive: You build a healthy savings account. Negative: You rebel because you feel deprived and as a result go into debt.
Same as if you were pampered with material things growing up, you will seek them out in the future even if that means going into debt. While if you were deprived because your parents feared money, then you will learn to be frugal. Both have their positive and negative influences and it really depends now on your perspective and understanding.
Nevertheless, there is no doubt that your influence in the management of money or lack of it has leaked out into everything that has thus happened in your life so far.
Common Negative Money Mindsets
- I’ll never be good at money
- He/She just got lucky and that’s why they’re successful
- It’s my parents fault, they made me this way
- I’ll never make as much money as…..John and Jane Doe
- They’re just lucky to be born rich and inherited all their wealth.
- You can’t get rich without cheating someone out of their money
- My debt will never be paid off
- Life is unfair, it’s finding ways to sink me
- I was meant to be poor
Making Poor Financial Choices?
- Spending too much
- Saving too little
- To scared to invest
- Competing or comparing yourself with others who appear to have more money
- Being over-cautious or too bold with your finances
If you find yourself practicing some of the behaviors listed above then it’s time to make a change. Your money mindset may have stemmed from your early childhood influences but that doesn’t mean you don’t have the power to change it. After all your money mindset is about belief. The thought of how much money you deserve, are entitled to have, and are able to earn, spend, and invest is all up to you.
Reframe your Money Mindset
Consider these tips to reframe your mindset so you can feel more financially secure
1. The lack of Money Mindset
The lack of money mindset comes about when you become concerned when it’s time to spend. It’s difficult to get the best service and product if you don’t spend. It’s equally hard to succeed or let your business grow if you are not willing to pay fairly to your employees, or buy the best materials, be in the best location, avail of the best service, etc.
This fear around ‘spending’ is rooted in a lack mentality- you basically think: “It’s such a waste to pay too much, I will lose this amount and will not get it back.” But is that really true? Bri Seeley, a business and entrepreneur coach, shared in a video that one of her money mindset tips is to think of spending money as investing money. There’s this old saying “You have to spend money to make money”.
2. Focus less on the money and more on solving a problem
Instead of stressing over how to make a profit, shift your focus on solving a problem, a need, a solution that will best help others. If you solve a problem naturally money will follow.
3. The concept: You need to work hard to make a living
We’ve been taught to believe that the harder you work the faster you make money. Because of this belief, a lot of people get discouraged, Some choose a “get rich quick” scam.
This comes from the perception that making money only comes with hard work or if you’re making money too easy, it must be illegal!
Good news, those were the days- At present, you will find lots of people making passive income. They are the New Rich. Entrepreneurs living the laptop lifestyle– work anywhere, at your own schedule. It’s all about creativity, service, automation, and connectivity. With the web connecting everyone, there are a lot of opportunities and ways to make a living doing the things you love.
The Power of a Growth Mindset
Ramsey Solutions “conducted a study of over 10,000 millionaires, and 97 percent of the millionaires believed that they could become millionaires.” Do you believe that you can become a millionaire? Even if your goal has nothing to do with generating seven figures, Do you believe you deserve a financially free life?
We all like to dream about being financially wealthy or at least attain financial freedom. For most people though, it remains a dream and nothing more. Why? It’s because most people don’t set their minds to achieving that goal. They might not be happy in their current situation but they’re comfortable – and comfort is one of the diseases of growth.
Carol Dweck author of Mindset said that there are essentially two types of mindsets: Fixed Mindset and Growth Mindset. The Fixed mindset sees nothing but limitations. While the Growth mindset is based on the belief that your basic qualities are things you can cultivate through your efforts.
The payoff for strengthening your money mindset is massive.
An equally powerful psychological technique is that of Reframing. No one can stop bad things from happening. It’s a part of life. But psychology teaches that it’s not what happens but how we react to it that makes the difference.
If you want to be a rich person, don’t let the poor person inside of you do the talking – Robert Kiyowsaki
How to Change your Mindset
1. Stop trying to live up to outside expectations.
Ask yourself whose life are you living? Are you trying to live your life based on other people’s expectations?
Living for others whether you are being controlled, or trying to compete with others- trying to impress someone, or you think there’s no choice somehow is a very common situation.
It’s impossible to build your dream life if the goals you are working towards aren’t your own. You’ll be surprised at how fast your life will change when you focus on the things that matter to you instead of caring about other people’s opinions and expectations.
Your goals and how you spend your time working to achieve those goals have to come from knowing what you want for yourself. You always have a choice!
2. Start each day with YOU
Instead of starting your day working on tasks for others. Start your day working on yourself first. Wake up a little early to do your self-love and self-care routines.
Make sure that your needs are taken cared of: physically, mentally, spiritually, emotionally. As you take better care of yourself, the result will be growth, success, and freedom in other areas of your life.
3. Know what you want, set it as a goal, and go for it.
It’s almost impossible to achieve anything if you don’t know what you want. Everyone wants something in life. Dream big and believe in yourself. Set a firm goal, and go for it. By setting yourself attainable goals, packaged into small actionable consistent steps you will get there eventually.
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4. Give 100% in everything you do
Are you dreaming of financial freedom? Take everything you do in your business seriously.
Gary Vaynerchuk, author of “one is greater than zero” said, There is a temptation to only focus on the numbers when you’re starting out. When those numbers are low, it feeds into negative self-limiting beliefs. This then creates a situation where the business leader does not take things seriously enough.
Business is a difficult and challenging terrain. The path to more revenue and a life of freedom happens when you take everything you do seriously from day one, fear is inevitable. But giving your 100% even when no one is watching can be very powerful.
The goal is to be your own boss- take the risk, play to win not to avoid defeat, and stop working for money, make money work for you instead.
5. Never Stop Learning
The best thing you can invest in is YOURSELF.
Most people who finish school think their learning days are over. Well, theirs might be, but yours shouldn’t be. Successful people continually learn and adapt.
6. Think Big
While you should start off with small goals, you absolutely should have a big goal in mind. Before building that million-dollar mindset start with developing a 100k mindset first.
If you have a business idea, then that is your ultimate goal – to start that business and make a success of it. Nevertheless, there is no shame in not achieving a big goal. If you run a business and aim to make $1 million in a year and “only” make $300,000, then you’re still significantly ahead of most people.
Aim for the stars, if you fail you’ll still be over the moon.
7. Be bold and Put yourself out there
In order to achieve success, you have to be willing to promote yourself or your brand. Don’t be embarrassed to get your name out there. That means finding a spotlight and being brave enough to step right underneath it. Attention exposes the service or the product you want to provide/ share. It attracts your future clients, and your followers will eventually become customers. This is the key to growth and building a freedom-based business.
“Change your language, change your mindset, change your actions, change your life.” – Danny Ston
6 steps to build your Money Mindset
It’s important to shift into a growth mindset in order to accomplish your goals. Using solid growth strategies is essential to doubling your revenue. It all starts in your mind.
- Have a positive mindset towards money. Be goal orientated and think long term in terms of your actions and choices.
- Appreciate what you have and be optimistic about the future. This will help you put things in perspective and help you make positive changes.
- Focus on what you really need than what you want right now. This will help you make better financial choices.
- Discipline. develop the power to ignore current pleasures for bigger rewards.
- Change your perspective by being optimistic about the sacrifices you need to make today, to enjoy tomorrow.
- Believe and aim high. Know that you deserve a better life, work for it!
- Tracking your income and expenditures
- Spending less than you earn
- Saving towards exciting goals
- Continuing to develop your financial literacy
- One of the most significant steps in a positive money mindset is letting go of past mistakes. Treating them as lessons learnt will help with moving to a more positive outlook on money.
Nothing or no one can stop you from living your dream life unless you give them the power to.
If you plan on changing your money mindset then here’s a related post HOW TO CHANGE YOUR SOCIAL CIRCLE AND UPGRADE YOUR LIFE