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Have you ever heard the phrase, “money mindset?” If you think it’s just some goofy phrase, you’re partially right, but it actually does make sense when you think about it.

In all honesty, most people have some kind of negative thoughts or ideas about money, whether or not you have a lot or a little.

If you’re rich, then you’re just a rich snob, right? If you have little then you’re just bad with money, right?

It sounds like a funny concept, but if you’re truly honest with yourself about your money mindset (i.e. the feelings you associate with money), are they mostly positive, or negative?

This isn’t a “gotcha” moment. The truth is, most of us could probably improve our money mindset and be far better off for it.

In this article, I’m going to tell you exactly how your money mindset can make… or break your financial freedom journey.

Why Your Money Mindset Matters

It wasn’t until I read Rich Dad, Poor Dad that I had even the foggiest understanding of a money mindset. By the time I finished reading the book, I understood that I had a pretty broken understanding of what it meant to be rich or poor.

Now if you haven’t read this book, I highly recommend it. This book was the thing that got me initially excited about the FIRE movement and financial freedom as a whole, but I digress.

Your money mindset is the key to achieving success or failure in your financial freedom journey. 

But why?

Think of it this way. If you have a negative money mindset and believe that money is bad or that you don’t deserve it, you will (unconsciously) chase money away from you. Essentially, you will get in your own way.

You’ll convince yourself that you don’t deserve a raise, or you’ll find an excuse for why you can’t save more money.

If, on the other hand, you have a positive money mindset, then you will have an easier job of acquiring a higher-paying job, or saving and investing more of your money.

These are simplified examples, but the idea is to hack your money psychology so that you can earn, save, invest, and grow the money that’s at your disposal.

Ultimately, it’s your money mindset that will determine whether you remain poor, middle-class, or rich. It sounds extreme, but it’s the truth.

So be honest with yourself, is your money mindset helping or harming you along your journey? Don’t be too hard on yourself if you’re not where you want to be today – there’s always room for improvement! 

In fact, my money psychology is something I frequently revisit. Culture can make it difficult to maintain a positive mindset (about a lot of things, but money being key here) – sometimes you have to break bad habits and revisit beliefs that may no longer be serving you.

Reflect on where your money mindset is today, and where you’d like to be. Is it serving you, or is there room for improvement?

10 Ways Your Money Mindset Shapes the Journey

Are you ready to become the master of your financial destiny? Here are 10 ways your money mindset can shape your financial freedom journey.

1. From Scarcity to Abundance

Ditch the “never-enough” mentality and embrace abundance. Visualize your goals, celebrate small wins, and see money as a tool to create a fulfilling life, not a source of stress.

Hack it: Practice gratitude for what you have, visualize your financial goals, and surround yourself with positive influences who believe in abundance.

2. Goals Galore

Don’t just dream, set SMART goals! Specific, Measurable, Achievable, Relevant, and Time-bound goals give your money direction and purpose. Plus, achieving them fuels motivation and keeps you on track.

Hack it: Visualize what you’d like to do, buy, or own once you achieve your financial goals.

3. Budget? 

Budget! It’s not a punishment, it’s a powerhouse. Knowing where your money goes empowers you to make smart choices and allocate it toward what truly matters. Think of it as a roadmap to your financial dreams!

Hack it: Implement the “24-hour rule” before making non-essential purchases. Ask yourself, “Will I truly value this in a month?” and redirect those funds towards your financial goals.

4. Future You, Best Friend

Invest in your future self! Start small with automatic savings or retirement contributions. It’s like giving your future self a high five for being awesome (and financially secure!).

Hack it: Identify limiting beliefs about money and challenge them with positive affirmations. Focus on what you can control and take responsibility for your financial decisions.

5. Knowledge is Power

Don’t be afraid to learn about personal finance! Read books, listen to podcasts, take courses. The more you know, the more confident you’ll be in making informed decisions.

Hack it: Embrace learning about personal finance, seek out financial mentors, and celebrate your progress, no matter how small. Remember, even small steps lead to big changes!

6. Stop the Comparison Trap

Comparing your journey to others is a recipe for discouragement. Focus on your own progress, celebrate your wins, and be proud of your unique path.

Hack it: Stop comparing yourself to others and start comparing your current self to your past self (which is a vastly more fair comparison). Uplevel yourself instead of comparing yourself to others!

7. Gratitude is Golden

Take a moment each day to appreciate what you have, even if it’s just a roof over your head or a delicious cup of coffee. Gratitude fosters abundance and keeps you grounded in the present.

Hack it: Make a daily gratitude list to build this mindset muscle.

8. Mistakes Happen (and that’s okay!)

We all make financial missteps. Don’t beat yourself up! Learn from them, adjust your plan, and keep moving forward.

Hack it: Learn from your mistakes. Educate yourself about different investment options, start small with low-risk investments, and focus on the potential rewards rather than the perceived risks.

9. You Are Worthy

Believe in yourself and your ability to achieve financial freedom. Ditch the self-doubt and replace it with empowering affirmations. You’ve got this!

Hack it: Read stories of others who struggled with imposter syndrome – it’s a common struggle!

10. Surround Yourself with Positivity

Seek out supportive friends, family, and online communities who share your financial goals. Their encouragement and shared experiences can be invaluable.

Hack it: Reflect on those you spend most of your time with. Are they contributing to more positivity or more negativity?

Bonus tip: Track your progress! Seeing how far you’ve come is a fantastic motivator and keeps you accountable. So grab your financial compass, set sail, and remember: you are the captain of your financial ship!

Costly Examples of a Negative Money Mindset

• Fear-based spending: Panicked buying due to scarcity thinking often leads to impulse purchases you regret later.
• Procrastinating on debt repayment: High-interest debt snowballs quickly. Tackle it head-on with a strategic plan to save you money in the long run.
• Limited beliefs: Thinking “I can’t afford it” or “I’m not good with money” can become self-fulfilling prophecies.
• Impulse buys: That $150 purse you don’t need adds up! Instead, redirect that money to savings or investments.
• Fear of investing: Keeping your money in a low-interest savings account means missing out on potential growth. Invest strategically to build wealth over time.

Conclusion

Your money mindset is a journey: it’s both changeable and powerful. By incorporating these tips and fostering a positive outlook, you’ll be well on your way to financial success.

Be patient with yourself, celebrate your wins, and keep learning and growing. With a positive, empowered mindset at the helm, you’ll navigate your financial journey with confidence and reach your destination to financial freedom!

Have questions or need additional support? Leave a comment below!

Now that you’ve learned how to hack your money mindset, you might be wondering how else you can FIRE Your Career. Check out the posts page for more ways you can FIRE Your Career and achieve financial freedom.

FIRE Your Career: Achieve Financial Freedom Through Your Career & Spend MORE Time Doing What You Love.

Resources I Recommend In This Article:

Rich Dad, Poor Dad (a great intro to financial freedom book)

Resources I Frequently Recommend:

ClickUp (my recommended goal-tracking and project-management tool)

Strengths Finder (book to help you uncover your innate strengths, includes a free personality quiz)

The Bogleheads’ Guide to Investing (a great intro to investing book)

Others: 16 Books I Recommend to FIRE Your Career