What is money mindset?
Your money mindset is a collection of your beliefs, perceptions and attitudes about money. This usually means having either an abundance mindset or a scarcity mindset when it comes to money.
It’s not about believing in ‘woo-woo’ energy and that manifesting abundance will simply make it happen! It is more about the mindset you have when you make financial decisions. If you make decisions from a place of financial stress and a belief in a lack of resources, they are usually not the same types of decisions you would make when you feel abundant.
What is a scarcity mindset?
A scarcity mindset is when you view the world as not having enough to go around and that no matter what, money is a limited resource. Stephen Covey, the author of ‘7 Habits of Highly Effective People’ coined the term ‘scarcity mentality’, which was the idea that people with a scarcity mentality see the world as a finite pie. If someone takes a piece from that pie, there is then less for everyone else.
While a scarcity mindset can help you have a laser-like focus on specific and immediate financial goals, it can come at the cost of ignoring your other goals and needs. This focus on short term goals, rather than the bigger picture, can lead to feelings of frustration, anxiety and unhappiness and it can limit your creativity when you are exploring financial options.
What is an abundance mindset?
A mindset of abundance is where you look at every possible favourable outcome for your financial situation and being open to each one. Covey – who also coined the term ‘abundance mentality’ – proposed the view that an abundance mindset is where you believe there is in fact plenty out there for everyone. It is also about believing that you are just as deserving as everyone else and your financial gain does not come at the financial cost of someone else.
Tips on how to move from a scarcity mindset to an abundance mindset
Focus on what is possible, and not on what could go wrong
Think about what matters to you and don’t compare yourself with others. We have all walked a different path in life
Eliminate FOMO! The fear of missing out means you will tend to focus on what you don’t have, while ignoring opportunities that are out there for you
Be grateful for what you do have, and don’t worry about (and waste negative energy on) what you don’t have (yet)
Engage the services of a life coach who can help you work on your money mindset
There are lots of great, free resources out there about money mindset – read widely and build your knowledge about financial matters