Your personal mindset has a good deal to do with whether or not you find money success. Personal growth is all about becoming aware of your actions and choices and considering how you can improve those actions and choices.
When you put that spotlight on your money, you can often reveal quite a lot about improving your personal finances. Here are some Jedi mind tricks to get the right mindset for wealth.
Personalise rich
What does “rich” mean to you? Once you sit down and start answering that question for yourself, you begin to realise that “rich” doesn’t mean the same thing to everyone. You need to figure out what you define as “rich,” which is, in a very vague way, your long-term goal. For me, rich is often defined in security – is my family safe from whatever may come? Others may define it very differently.
Establish goals
From there, take the ideas of what makes a person “rich” and transform them into specific, tangible goals that you can use. What does it mean for my family to be “safe from whatever may come”? When I’m able to transform that into a specific goal, like a big emergency fund, then I have something to work towards — that’s real as opposed to the vague notion of something that I might just be dreaming about. Craft your money philosophy
What you’ll find as you figure out what “rich” means to you and establish goals based on it is that some values will be important to you. For some, family is a key value, and thus for them, money philosophy centres deeply around providing for their family. They value having an emergency cash reserve and they are less interested in chasing big financial growth.
Embrace your relationship with money
The idea here is that many people are detached from their money in many ways. They don’t connect their hard work to the money they have, and they also don’t connect their account balance to all of the things they spend their money on. This leads to a deep sense of “where did all the money go?” And often to a feeling that there’s something deeply wrong without really understanding what that is. The solution is to spend time and focus on this connection. Keep careful track of how you spend money. Talk about money with your loved ones, even if it’s uncomfortable. Keep it in your mind and embrace it.
Organise, don’t agonise
Another issue many people have with their money is that it’s difficult for them to figure out what they have and what they don’t have. Their records are disorganised and the information they need isn’t available when they need it, which makes it all the more difficult to really embrace their relationship with money. The solution is an efficient filing system, where you keep the relevant information you may need in the future in a known place that can easily be retrieved when you need it.
Be your biggest advocate
Become your own advocate – in other words, have a backbone when you talk to people who have an impact on your finances. Don’t be afraid of the customer service representatives. Your approach should be to know what to expect from them before you even talk to them and when they don’t provide it, insist and go for what you expect — provided your expectations are reasonable. Firms aren’t your advocate – you are.
Make your money count
When you start to get ahead financially — meaning your net worth, the total of your assets minus your debts is going upwards — make sure you put your money where it counts. The more return you consistently earn on your money, the better. If you put it into savings, look for options with better return. When you consider which debt to pay off, look hardest at the debt with the highest interest rate.
Think five years ahead
Almost always, your best financial choices are made if you ask yourself, with every shilling you spend or invest, what will have the biggest positive impact five years from now. Sometimes, it’s a tricky question, but that question will point you (almost always) in several positive directions: towards frugality, towards repaying debts, and towards good choices with regard to making your money count.
Break from the norm
For many people, this type of personal change is very difficult because it is different, not only from what they’ve been doing before, but also what people around them are doing. Recognise that you’re breaking from the norm in doing this. Revise your social circle. Look for new people to associate with. Break bad habits. Keep the changes simple and straightforward.
Embrace the entrepreneurial spirit
One final step is to embrace the idea that you are an entrepreneur. Everyone who exchanges work for money is essentially a small investor on some level, and every small investor owes it to themselves to always seek out the best exchange of money for their time and effort that they can find. This means not only looking for side businesses to start, but also focusing on improving yourself, your abilities and skills set.
— moneyacademy.co.ke
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