8 Steps to Create a Positive Money Mindset

In the last article (transform your money with positive money mindset), we discussed the benefits of developing a positive money mindset.

Here‘s a Recap,

A money mindset is an overriding attitude that a person has about money and finances. It drives how financial decisions are made and has a big impact on the ability to achieve your goals.

A money mindset is like emotional inertia. It can hinder you or drive you to action. Seen in this light, it’s not debt or a low credit score driving the lack of success and holding you back. It’s really your perspective and interaction with money that creates your money story. This story dictates your relationship with money.

Positive Mindset

If you have a negative money mindset, this negativity breeds emotions that prevent action and manifests as:

  • Fear of Unknown
  • Intimidation
  • Procrastination
  • Defeatism

A negative money mindset can literally sabotage your life and all the hard work you have been doing. No amount of goal setting, advanced planning, or financial acumen can overcome a negative money mindset.

If you have a positive money mindset, you are more likely to be decisive and take the steps necessary to succeed. When your money mindset changes to focus on the positives and what is possible, it’s much easier to see the path forward.

Changing your money mindset from focusing on the negative to embracing the positive will also move you from poverty and scarcity thinking to prosperity and abundance thinking. Money stops being the villain and becomes the hero that saves the day. Money will turn into a tool that can be used to enhance your life.

Changing your money mindset isn’t an overnight process. Like anything else, it takes awareness, practicing of positive habits, and diligence. However, I honestly believe that it is a necessary and essential step towards improving your financial situation.

If you change your money mindset, you can change your life. You’ll make better decisions, embrace challenges, see the opportunities available, and make it happen! The power of positive thinking is an extremely powerful tool.

OK, Then How Do I Do It?

I know, I know. Easier said than done, right? Well not exactly….

In fact, I’ve developed some actionable steps to develop a positive financial mindset. Here goes….

Recognize the Need for Change

To start any personal change, the first thing that must happen is that a person needs to recognize and acknowledge that change must occur. A person needs to admit that a problem exists and commit to changing.

When it comes to views on money, people can be…. incognizant of their situation. While you may think you know your attitude and mindset towards money, it’s entirely possible that you are not fully aware of how your personal views are shaping and possibly distorting your decision-making.

Not sure what your money views are? The best way to recognize is to track your thoughts. Each time a money decision comes up, track your thoughts and reasoning. Review the results for patterns in your behavior, attitudes, and beliefs. Tracking your thoughts will lead to clarity and positively impact the ability to create and adhere to goals and plans.

Practice Forgiveness

Are you one of those people who have NEVER ever missed a credit card or utility payment? Always had the discipline to NEVER go on an impromptu shopping spree? Well good for you! You’re a financial guru! Unfortunately, you’re in the minority. Most people have experienced a slip up (or ten! 😊 lol) in their life.

This leads to shame and blame. Like eating a quart of ice cream at midnight and feeling horrible about the weight gain the next day, shaming yourself about poor financial choices starts the progression of a downward spiral. The only way to break the downward cycle is to recognize and forgive the behavior that needs to be changed. The road to recovery and change starts with forgiveness for past mistakes.

To forgive your financial mistakes, first acknowledge what happened, apologize to yourself, and then focus on moving onward. If you notice past negative thoughts and behaviors creeping back, remember the financial mistakes made are just that, mistakes. The mistakes made are not you and do not define who you are. Your feelings of self-worth are independent of your mistakes and you have the choice to decide how to proceed.

Forgiveness is a powerful tool because it prevents us from being a prisoner to our past. By shifting focus away from shame, we make room for better practices and a healthy attitude towards money. It is important to acknowledge and accept what has happened. Make apologies to yourself and others (if your financial decisions have negatively impacted them) then focus on moving forward.

Stop Comparing Yourself To Others

Comparison…..a double-edged sword. On one hand, it can be a motivating factor for self-improvement. On the other hand, it can be a hindrance toward achieving your goals. Like going to the gym and comparing your progress against others, making too big of a deal on how your progress stacks up to others ignores a basic fact….. the journey.

Two things I had to learn about working out is: we all have the same starting point and each person is simply at a different point on their physical fitness journey. No 2 situations are the same and no 2 paths are the same. More often than not, comparing yourself against others doesn’t make sense other than to give yourself motivation to continue your personal journey.

Financial fitness follows a very similar philosophy. Comparing your progress against others is a self-defeating prophecy for several reasons. First off, you are comparing what you know about yourself (warts and all!) against what we see in someone else (their best side that is being chosen to be shown to others).

Second, you don’t know the intimate details of other people’s finances. They may appear to have a great life: large house, expensive car, a boat, awesome vacation memories …on the surface. All that fun stuff could be fueled by vast amounts of credit card and personal debt. Want a real-life example? Look no further than the Real Housewives of New Jersey. ‘Nuff said. 😊. Remember… all that glitters is not gold!

The best you can do to help yourself out is to make a promise to yourself to get better each and every day and start out with small, attainable micro-habits, master these, then celebrate the small wins along the way as you achieve your goals.

Promise Yourself To Make Changes

You thought I was going to say, to set goals attainable goals, didn’t you? LOL. Goals are good to have. The problem with goals is that people tend to set goals that are not easily attainable or easy to break.

On the other hand, a promise is more concrete. As stated in a recent Phil Town podcast, making a promise to yourself is essentially committing yourself to achieve the desired result. From this commitment, integrity and goals are created that will outline the plan used to achieve this commitment. If the plan falters or needs modifications, that’s ok because the underlying promise is still there. The only thing changing is the plan for achievement.

Develop Good Habits

Once you make a promise to yourself and use the promise as a foundation to keep your eye on the prize, next good habits need to be established that ensures you meet the intent of the promise.

Never delved into your finances or created a budget? Now is a great time to do so. Do not let any past financial trauma prevent you from understanding where your money is going. Understanding where the money is going will help in determining where to save money and plug money leaks. Need help picking a habit to start with? How about time management.

Dedicate time each week – a minimum of 30 minutes – to review finances and track your progress. Seems like alot? Not really. Millionaires, on average, spend 8.4 hours per month managing and tracking their finances. This averages out to about 2 hours a week. Want to get to where others have been? Find the habits they developed and emulate them.

In a relationship or marriage? Another good habit is to talk about finances and mutual financial goals. More often than not, couple are on different financial pages. Money conversations aren’t always smooth sailing when starting out so push through the discomfort and work on listening to each other’s needs. Alignment in communication leads to agreeing on commitments and mutual goals.

Optimize Budget for Personal Happiness

The word, “budget”, can fill people with anxiety and dread because budgets are seen as limiting and constricting. This could not be farther from the truth. In fact, budgeting is all about prioritizing what’s important to you and accounting for it. Want to payoff your credit card? Add it to the budget. Want to enjoy your Starbuck’s Caramel Macchiato every day on the way to work? Add it to the budget. Want to take a nice vacation to the Bahamas every year? Add it into the budget.

The more you prioritize, the more it will become apparent that budgets aren’t limiting but instead are empowering. Budgets provide clarity of purpose because you know where your money is going. It provides boundaries and direction. Boundaries aren’t limiting, they set you free! 😊

Budgets are also adaptable. Life happens and drives changes to the budget. That’s ok since a budget reflects your priorities and priorities can change from time to time. Awareness of priorities ensure tweaks to spending occur so that your hard-earned money goes towards what matters most to you.

Set New Promises and Goals

Hit all your promises and achieved all your goals? Great! What’s next…. Simple. Set new promises, habits, and goals. Financial fitness is a lifestyle. Lifestyle changes are geared for the long-term. To ensure long-term success, embrace the new lifestyle.

positive mindset

You may be asking yourself…. How do I do that? Start by informing yourself about money. Become a student of personal finance.

A good way to learn more about personal finance is to read books or blog articles. Your feelings about money directly affect your financial reality.  The good news is that your feelings can change with a little personal education. The key is to feed your mind with new, positive, and constructive information that teaches you a whole new way to think about money. Change your life by changing your thinking.

A few of my favorite books are listed here.

Not into books and prefer blog articles?….. here a few great ones to start with:

Daniella from I Like To Dabble

ESI Money

Financial Samurai

Smart Money Mamas

Prefer YouTube? Try checking out a few of my favorite personal finance personalities:

Another great way to get and stay motivated is to follow successful people and emulate them. If you want to be financially independent or if you want to be a great parent, find people out there who have done what you want to accomplish, learn from them, and emulate them.

Will Smith has a ton of great YouTube clips that have inspired and motivated me in the past. Check some of these out.

Another person who has motivated me in Dwayne “The Rock” Johnson. Yes, he was the son of a famous professional wrestler but unfortunately, he grew up poor. They moved around a lot for his dad’s work, he was homeless at times, and ran into trouble with the law. Football was his way out and for a time it was working for him. Then he tried unsuccessfully to be a professionally football player. He bounces around the NFL, CFL, and you name it trying to land a job. It didn’t work out for him.

On his last legs, with $7 in his pocket, and a wife to take care of, he hit bottom. He reached out to his dad to teach him the family craft and the rest is history.  He made himself into the richest actor in the world today through hard work and perseverance. Follow some of his YouTube video clips here. If you cannot draw inspiration from his story and legendary work ethic, I challenge you to find a better example.

There is a lot of great content out there. Take the plunge to find things that fit your needs.

Do you have any personal favorites you’d like to share? Send me your comments here. I’d love to hear from you. 😊

Practice Gratitude

Last but not least, is to practice gratitude. Practicing gratitude reminds a person to appreciate what they have and reinforces the good things that have happened to them.

 A common trap is to focus and dwell on the negative. I wish I wasn’t scared to talk to girls, I wish I weighed 10 pounds less, I wish I was better at chemistry.

Practicing gratitude turns your attention away from what’s wrong and focuses you on what you are doing right. By focusing on the positive things happening in your life, it’s much easier to stay motivated and reach your goals.

If you focus on what’s wrong, it’s almost impossible to get and stay motivated. Practicing gratitude means focusing on finding solutions and appreciating the outcomes.

Setbacks happen to all of us. How we handle and draw inspiration from those setbacks is the difference between success and failure.

Don’t know how to get started? Try keeping a journal. Start by writing down 1 thing every day for which you are grateful for either professionally, financially, or personally.

It could something as big as being grateful for the recent promotion you received to having a great spouse and kids. It could be something as simple as being grateful that your AC worked on a 100 degree humid day. No amount of appreciation is too big or too small.

When you start to feel gloomy, negative, overwhelmed, or in a rut refer to that journal to remind yourself what you appreciate about your life.

What It All Comes Down To…….

Your ability to generate money and to live your life to the fullest is infinite. The only restrictions are the ones placed upon yourself from the stories developed over your lifetime. To re-write your mindset, you need to re-write your story. Focus on the positive things that have happened and be grateful for what you have.

Positive Mindset

Learn to enjoy and trust the process. By being a force for positive change in your life and the lives of others, good things will come your way. As Cassandra from Brie on a Budget states,

“People won’t always remember what you said, but they never forget how you made them feel.”

Live the Life You Love, Want, and Deserve 😊