Personal finance and investing decisions aren’t completely objective, numerical-based judgements – they are subjective in nature, dependent on your lifestyle and goals, and swayed by mental and emotional influences like stress and your money mindset.
Your mindset is a critical component of success in all aspects of life – Stephen Covey, author of best-selling book The 7 Habits of Highly Effective People, framed one’s money mindset as a dichotomy;
- A scarcity mentality refers to people seeing life as a finite pie, whereby one person taking a piece leaves less for everyone else. A scarcity mentality is constricting and fear-mongering, fuelling competition and holding you back from achieving your goals.
- An abundance mindset refers to the opportunistic outlook that there is plenty of pie for everybody. An abundance mindset is optimistic and empowering – encouraging you to pursue growth and focus on your personal goals, regardless of everyone else.
What mindset resonates with you right now? Have recent world events or life stressors impacted your outlook and actions? It’s important to remain aware of your money mindset as it is not concrete and can be influenced by new experiences, especially if there’s been a bump in the road along your journey.
Want to encourage or sustain an abundance mindset? We’ve heard many clients who have benefited from implementing a regular gratitude practice or using affirmations to help them remain growth focussed. Regularly reminding yourself of what a rich life looks like to you will help ground you and keep you on track working towards the goals you set. Tracking your progress keeps you feeling empowered as you get to celebrate the small wins along the way. By staying growth-focussed, it also trains your brain to be open new opportunities – keeping you open to the possibilities of more resources, more options and more choices.
Gilkison client and coach, Hazel Ruby – has a keen interest in exploring what actually creates the feeling of happiness and fulfillment for people, and through her work she’s discovered that it is not money.
“To be financially stressed is extremely hard, however the wealthiest people I know aren’t the happiest. It’s more about enjoying the feeling of abundance that creates joy in our lives and this often comes from having a sense of purpose and meaning.
I believe this is the very reason why many gain such satisfaction from volunteering or practising philanthropy. So perhaps it’s not so much about what money can buy that matters, perhaps it’s more about what money can give….. and without doubt those who do this truly have an abundance mindset. They appreciate what a privileged position they are in and want to share that abundance so others feel it too. And maybe, that’s what can create the greatest feeling of happiness of all… for all.”
Have things changed since we spoke last? As you go through different life stages, your circumstances (and goals) will change, this is why we encourage you to regularly review your cash flow mapping to make sure your financial structure is still the most appropriate. When we define and prioritise the important things in your life (subjective), we are able to assist with the objective application of financial resources. In regards to your money mindset, this replaces worry (aka a scarcity mindset) with a feeling of empowerment and direction (an abundance mindset), which are quickly supported by the achievement of results and a richer experience of life.