Dave Ramsey, personal finance guru, emphasized the importance of the Money Mindset and how it can reshape your attitude towards your finances. But what is the ideal Money Mindset? We’re going to break it down for you today!
Money Mindset is what you believe about yourself, money and how you and your money work in the world around you. The Money Mindset is all about your every day choices that shape your financial future. Sticking to a budget is a choice. Going on a shopping spree is a choice. These choices affect what happens at the end of the month when bills are due. The habits, formed by repetitive choices, affect what happens in 3 months, 6 months, a year, 5 years and on and on. If you find yourself short every month, living paycheck-to-paycheck, it’s time to check your money mindset and shift some of those beliefs and habits. The only person who can change your relationship with money, is you. Your mom can’t nag you into financial responsibility. Your partner can’t make you care about your finances. Only you can change your attitude and your situation.
Healthy attitudes towards money can drive your decisions, savings habits, spending habits and more. People with a healthy relationship with money believe that they are in control and have the freedom to choose to save or spend. They believe in giving responsibly, and when able, generously. They do not compare themselves to others and don’t try to keep up with The Jones’. They believe they can achieve their financial goals, and they set those goals.
Your attitudes about money are generally shaped by what you are exposed to growing up. If your parents talked about money openly, you’ll be more inclined to be open with communicating about money too. If they struggled and spent money like it was going out of style, you may be inclined to overspend as well, or you may sway the other way and pinch every penny. Think about what was modeled to you and examine where you can work on shifting some beliefs.
Why It’s Important
Knowing what your money mindset is helps you on your financial journey by highlighting areas that need improvement. Every single person has areas of improvement to work on. Money and attitude is no different. By knowing what your attitudes and biases are, you can be mindful of them when it comes to financial habits and more easily adjust as you go.
How To Change Your Money Mindset
Educate yourself. Read personal finance books and blogs. Listen to podcasts, watch TedTalks and find a financial whiz to follow on YouTube. Find a role model and start listening to how they did it. Find your inspiration and put in the work to get to where you want to be. If you’ve got a mental block, start by writing about what you know, your current financial situation. Write about what you saw regarding money in your family. Write about your current financial habits and what habits you would like to have. Start setting goals, small ones at first. Then work your way up. Start with baby steps and go from there!