“Money is not cozy. Rich people are not nice. I’m not good with money. It’s not for me.” Recognizable? Our thoughts around money are – ahem – not always positive. Not surprising either, because there are so many interests, emotions and events related to money. But a positive mindset is going to help you tremendously. We would prefer to start seeing money as a practical thing that helps us realize our dream life. In this article, 4 tips to change your mindset around money in order to make your journey to financial self-sufficiency and independence a little more pleasant.
More mindset tips and exercises? Get started with the Mindset e-course “improve your mindset and feel good about money” by Elfin.
What is “mindset” anyway?
Everyone is talking about it, from positive mindset to money mindset. But what are we talking about? Mindset refers to the mental attitudes, beliefs and thought patterns you have toward yourself, your abilities and the world around you. It affects how you think, feel and act in different situations. Ah, clear. So a positive mindset is nice.
What does “mindset” mean in relation to money?
Our mindset can greatly influence the way we handle our finances. Your money mindset refers to the attitudes, beliefs and emotions that influence your financial habits and behaviors. Your mindset around money is shaped by your upbringing, personal experiences, cultural background and general attitude toward money. But even though our money behavior is influenced by our mindset, many of us do not take the time to reflect on our own thoughts and beliefs surrounding our finances. A missed opportunity, because you understand by now that a healthy mindset is going to greatly help you achieve financial goals and be smart about money.
4 tips to change your mindset around money
To help you, we have 4 tips to change, strengthen and give your mindset around money a push in the right direction.
Set a goal
Having a goal, knowing why you are actively working on your money matters, helps tremendously. Think of a budget plan or financial plan, but we like to go a step further: what is your dream? A trip around the world? Retire earlier? Enough money in your savings account? Enough money every month to enjoy shopping? No matter what it is, but a clear goal gives direction. If you don’t have a plan for your money, you will never really be able to change your financial situation. Because going for a drive without a clear final destination also leaves you a little lost chasing down the highway.
Don’t go shopping when emotions are running high!
We are no saints at Elfin and will acknowledge that the necessary emotion shopping sessions certainly passed the revue. We feel bad, and a brief shot of happiness surrounding a new release makes us feel better for a while. But that’s a shame. Disconnecting money and emotion is nice. For yourself, and for your long-term plan. But how do you do that?
Tip: the moment you find yourself wanting to spend money, purely for the sake of spending, to give yourself a shot of “nice feelings”: grab a pen and paper, and write down what is really going on. Postpone spending. Do you really want to buy this, or do you want to feel better? Go for a walk, call a friend, take a bath: but put off spending your money. Do you still want to make this purchase a week later? Then it might not be an emotion issue.
Stop comparing
Comparison is the thief of joy. So too with your finances. It is easy to compare your financial situation to that of your family, friends or colleagues. This can trigger feelings of lack, envy and despair. Recognizable? That doesn’t matter, we know it too! But it doesn’t help you. Look at your personal financial goals for yourself, not as they should be based on what you see in others. You do you.
You may see someone driving the latest car, but you don’t see that they can only just scrape together the money to make the installment payments each month.
You see a well-known influencer going on vacation again, but you have no idea if she has a healthy savings buffer.
You get the point.
But when you compare your own situation to others, your mindset changes from being grateful for what you have to being insecure about what you don’t have.
Focus on yourself, your goals and your financial resources. Unfollow the people online who make you feel bad and surround yourself with people who make you feel good about yourself, your financial choices and goals.
Change your personal story about money
If you’ve ever said to yourself “I’ll never be able to afford that!” or maintained the perspective that you’ll never be as successful as your wealthy friends, you’ve been dealing with a negative narrative that you keep repeating. So-called money scripts form the mental tape we have about money. They are shaped by what you tell yourself. So, cat’s up, we’re going to tell ourselves a new story about money!
I am good with money.
I am worthy of a salary increase.
I lovingly spend money on myself.
I can save well.
I successfully build long-term wealth.
Negative stories you tell yourself can have disastrous consequences for your financial situation because what you think affects how you feel, which then shapes the actions you take and ultimately the results you achieve. You’ll understand why it’s important to recognize negative beliefs so you can turn them into positive stories that will ultimately boost your finances!
