Wealth is a Mindset
Perhaps you’ve heard the phrase “wealth is a mindset.” If you haven’t, it means that lasting wealth is about 80% due to the beliefs you hold about money, investing, and wealth accumulation. 20% comes from the physical actions you take to get wealthy (investing, starting a company, winning the lottery).
If you have heard the phrase “wealth is a mindset,” have you paid it any attention?
I was reminded of this concept when I came across the Top 25 Personal Finance Myths at Your Credit Advisor. My Blink-level impression when the page loaded was, “this article is going to suck.” (I blame it on their generic and corporate-looking blog design.) Then I started reading the myths:
I don’t deserve to be rich. Rich people are scum. Those with obvious material wealth must be rich. There’s only so much money in the world. Becoming rich is hard work.
It turns out the first ten myths are common mindsets about wealth, which are the root cause for the vast majority of people not being wealthy. How can you know this is true, versus blaming it on things like luck, not having the right opportunities, or the right education?
An excellent example is lottery winners. It’s been documented over and over again: people suddenly become wealthy by winning millions of dollars, but a few years later are collecting food stamps and living in a trailer.
It’s easy to say, “Those people must have just been stupid. I wouldn’t make those mistakes.” I think you’d be wrong. They had mindsets of non-wealthy people and lost it all as a result. As within, so without.
So the question is, how do you get the mindset of a wealthy person? One way to help is immerse yourself in books about the wealthy and what they believe. I’ve probably read and re-read about 10 books in the Rich Dad series — and it’s forever changed the way I look at wealthy people and wealth creation.
Another thing to try is playing games that get you into the mindset of the wealthy. The only one is know of is Rich Dad’s Cashflow 101 (it’s basically Monopoly taken to a whole new level).
Finally, check out the latest podcast from Steve Pavlina: Faster Goal Achievement. The premise is that once you’ve changed your identity (mindset) in a particular area of your life, your goals are realized almost effortlessly.
Steve gives personal examples of trying to manifest a million dollars into his life. He noticed that while he might carry around $50 or so in cash in his wallet, rich people carried much, much more in cash. A wealthy person’s reality doesn’t include only $50 in their wallet.
So, Steve went to the ATM and started carrying around $200 in cash. He noticed that he felt very uncomfortable carrying that much cash. That uncomfortable feeling was a sure sign that his mindset wasn’t the same as wealthy people — to them, $200 is nothing. To Steve, it felt like a lot.
Eventually he got comfortable with $200, and kept increasing it until he was at $500. The idea here isn’t that carrying more cash in your wallet makes you wealthy — it’s simply a way to condition your mind to be used to larger sums of money. If carrying $200 in your wallet makes you feel strange, can you imagine how uncomfortable and out-of-your-element you’d feel with a $20 million dollar windfall from the lottery?
I hope the above resources gave you some concrete ideas on how to change your mindset about wealth. Start from within!
9 Responses to “Wealth is a Mindset”
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There is a lot of good information in this article!
The Pavlina bit is interesting, but I don’t buy it. If you want to have more money, I don’t think it’s going to help by carrying around more money than you can afford to have.
The richest in America got there by using much less than what they have. I doubt carrying around MORE than you have will prepare you for this money.
Now take the inverse, if you earn 35k a year, but you only spend 28k because you invest your savings. If you are comfortable using less than what you have, if you got that 20 million windfall, it wouldn’t be overwhelming.
Most people who buy lottery tickets probably aren’t the ones investing their pennies though…
I do buy Pavlina’s strategy, as long as you understand what it’s doing. I read the same tactic from a completely different source a week or two ago — and both Steve and this woman are on the road to wealth. I’ll qualify that by saying they both make over $100k/year.
In this other woman’s method, you simply hold a $100 bill in your hands and see how it makes you feel. Do you feel uncomfortable? Then tap it out.
Once you feel comfortable with $100, increase it until you feel uneasiness. Then tap out the uncomfortable feeling. When you’re at the limits of holding real cash in your hand, write a check to yourself for say $5,000 or $10,000. How does a $10,000 check feel in your hand, pretending it’s real? To a wealthy person, $10,000 is a drop in the bucket.
Sure, maybe it’s all bogus, and maybe it’s not. Can’t hurt to try
I’ll say this; when we’ve been in Las Vegas and I’ve held our team blackjack bankroll.. it’s a great feeling, and I wasn’t the least bit uncomfortable
It’s possible there is validity to it.
What I would like to see is a survey of millionaires (millionare next door style) with tests to judge their comfort with money, not just their spending habits. The statistics presented in that book all pointed toward behavioral actions, not towards mental beliefs.
Here’s a scary example of what can go wrong when you win the lottery. Jeeze.
your link isn’t valid
I know. It was too long and from the Rocky Mountain News
Here, hopefully this one will work: Powerball Problemos
I accept Pavlina’s strategy only to the extent of
how intense the desire to achieve wealth is for an
individual.
And with a greater intensity for that desire an
attraction can be manifested through the repetition of any perceived desire.
I love this article, it reaffirms what I have found to be true. I have always had a way about myself, and all of my uncles and aunts are rich, but my mother is not, and because of religous difference my mom has little contact with her family, at the age of 18 i toyed with the idea of being rich, though I was in college (and still am) my expectations were not really high. Something happened to me at my Dorm I had a disagreement with another student, he dismissed me as some rich kid who couldn’t possibly understand. How that impacted me, I started to realize something, I was not rich but even so, the influences that I had been raised in, did frame my actions and outlook more then I had even thought possible, I have friends and relatives who are rich , Some of them I grew up with I had never thought about it before, Why was my mom poor after the divorce, she had nothing with all these examples in her life, come to find out my mom was raise by relatives and separated from her siblings, I then was determined to be rich, I am still in college I changed my major I am currently studying to be a Nurse Practitioner, I now though have money comming in all the time I save I have amazing credit nice clothes I make more money than my mom, with thousands of dollars of disposable income a year, between my two jobs, now learning to invest with help from one of my uncles, and all this just by realizing that this is something i want and will simply have I am entitled to this and will achieve millions just like the rest of my family