Can’t save $100, can’t save $1000 or Why a rich mindset matters
I talk a lot about rich and poor mindsets and to be clear, I am not talking about BEING rich or BEING poor, I am talking about the way you look at, think of, and consider your money.
You can be rich with a poor mindset, and poor with a rich mindset.
They are all interchangeable. The best is to be of course, rich with a rich mindset!!!
Rich Mindsets are:
- Conscious spenders – it is not that they are cheap or even frugal; they consider every purchase and the value intrinsic or extrinsic it will bring to their lives and spend it if they see the value in it or other factors
- Solution-seekers – if they want something bad enough, they’ll look for a solution to make it happen
- Interested in wealth accumulation – not just spending it, they want their money to work for them
Poor Mindsets are:
- Spenders who don’t consider anything except price – Oh it’s under $5? I’ll take two even if I don’t need to and don’t really want it, it’s just SO CHEAP! What a deal!
- Excuse-makers – Oh that sounds too difficult. I am not good at math so I can’t possibly understand anything about money.
- Only interested in spending their money – what’s the biggest house I can buy with the biggest mortgage? Why don’t I just get new cars every 3-5 years and lease them instead of buying a crappy one, but in cash?
Situation: You get a $2000 tax refund
- Going to lower my tax deductions, I cannot be giving the government free money
- I’ll take that money and invest it / save it / pay down debt with it
- FREE. MONEY. I am going out and SPENDING IT!!!
My parents won the lottery, and then as they were rich at that moment, but with a poor mindset, they basically wasted most of it. They spend it on fancy watches, and vacations, and my father decided to only work part-time forever in his early 40s, with ONLY this amount saved.
The only good thing that came out of it, was they paid their home in cash at the time so their bills were relatively low, but my father continually dipped into this “retirement” nest egg to buy things like $5000 cameras, go on vacations, all until it basically disappeared.
They saved zero for our education, didn’t give any of us a penny for anything (not that we expected anything), and didn’t do anything a rich mindset would have done to think of — how can I keep this money accumulating and going?
Situation: You really want to go to the gym but the membership is $100/month
- How many times would I go? Would this be worth the $100? Am I being realistic?
- Can I commit to going and going often? What is the schedule going to look like? Is it realistic?
- What would I cut back on instead (activities or areas) so I can pay for and go to the gym?
- I can’t afford that.
- $100 is too expensive, I can’t cut that anywhere in my budget so I guess I won’t go.
I was in the poor mindset for a long time for this particular situation.
I used to refuse to pay for yoga classes. I tried VERY HARD to do yoga at home for free, or to go to free classes , but ultimately I’d get excited, do maybe 10 minutes and then get bored with no one firmly but quietly telling me: SQUEEZE. Hold it. One more breath.
I needed someone to guide me in-person, even videos online weren’t doing it.
And for what? With my poor mindset, I wasn’t doing yoga as often (or at all), and I was going to free classes but getting annoyed when the teacher was terrible or if the class was just not useful at all.
Finally, I bit the bullet, and paid for class passes which work out to about $16 per class (taxes in). This sounds expensive, and it is, but now I am regularly going 3X a week, and MAKING time in my schedule to do it, even waking up at 6 a.m. to hit a 7 a.m. class.
I finally switched on my rich mindset for yoga classes and have never been healthier or happier – it has truly improved my body, my mood, my posture and overall well-being which is something you can’t really put a price on.
On any income – you can have a rich or a poor mindset
You have to pick a money goal you really want, and not make excuses – figure out how you’re going to get there and if you’re willing to do it.
Some people on $45,000 a year, are saving half of their income. Why?
Because they picked the goal, and are doing it because they’re focused and willing to sacrifice/put in the work to do so.
Others, are making $130,000 a year, saving $0. Why?
Because they’re focused on enjoying the present, not interested in their future and unwilling to sacrifice their lifestyle.
Income has nothing to do with it — your mindset and discipline is key.