In a world filled with so much uncertainty that your sources of security can be taken away from you at any time, it is always wise to arm yourself with the right values. That way, you can have the proper approach to all the different things you encounter in life, including finances.
The world is experiencing different levels of the negative impact of the COVID-19 virus. Not in a million years did the world ever think of being in a situation like this. Many probably had in mind that a third world war is more likely to occur than a full-blown pandemic.
But it happened, and it’s still happening. And while certain things are beyond control, there are a few things that are within your grasp that you can change to turn around your circumstances, including your financial situations.
Taking Control of Things You Can
The thing about our financial situation is it did not happen overnight. It is the product of years and years of acquired habits and mindsets—both good and bad—that have been formed and ingrained into the deepest recesses of your mind.
Some people develop great habits in their formative years and education. They might have even developed these habits from graduating from a top university or going through a British curriculum that opened cultural sensitivity. Others got them at home as their parents passed on the correct values. Some probably picked up a good thing or two from other people.
On the other hand, people also acquire some bad habits from peer pressure, our surroundings, people’s insensitivity and apathy, and many other factors. Both the good and the bad contribute to where you are today and make us the people we are now.
In life, we can either keep making excuses or do something about our situation. And part of doing something about it to turn things around is having a brutally honest assessment of your values, habits, and mindsets and getting rid of the things that are causing us more harm than good.
Mindsets That You Go Broke and Stay that Way
Here are some mindsets that can be pretty harmful to our finances if not corrected soon:
- Overconfidence: Often, cockiness and arrogance get the best of many people, especially in their youth. Many feel that they are invincible and unstoppable, that time is on their side. Therefore, these people can take more risks and chalk up the wrong things to experience. Being overconfident can lead to recklessness when it comes to our finances. While people can celebrate optimism, wisdom and frugality are better options.
- Shame and jealousy: Many know what it’s like to envy someone. You see a peer doing well in life that you can’t help but feel embarrassed of where you are and jealous of what they have. This leads to the wrong mindset of keeping up with the Joneses. It forces you to unnecessarily spend on things just to show people that you’re doing equally great yourself. Stop and take a minute when you catch yourself being envious of someone or feeling sorry for yourself. Don’t let embarrassment and jealousy make you spend money on things you cannot afford. Instead, use them to fuel you to work harder and make wiser financial decisions. Keep in mind that we all have our races to run, so run your race. You are your actual competition.
- Guilt: Guilt is another destructive mindset that prevents people from enjoying life. Perhaps you believe that you don’t deserve the good things you’re experiencing, so you turn to spending to help relieve you of that guilt. You start giving gifts and picking up tabs because you want to share your blessings with others. While generosity is a commendable trait, it will not help buy your joy and peace of mind. Guilt-driven spending will drive you to bankruptcy if you don’t set limits to your spending. Have a financial plan in place that allows you to be generous (guilt-free) and protect your money at the same time.
- Feeling Overwhelmed: The feeling of being overwhelmed by a lot of things can be paralyzing. Instead of doing something about your situation, you tend to freeze and let things unfold naturally. In most cases, they take a turn for the worse. While acknowledging your emotions is good, you must also learn to take action — no matter how small it is. Even the smallest of steps can get you moving forward.
Having the right mindset can do us a world of good when it comes to your finances—and pretty much everything in life. Even if it seems to be going against society’s norms. It might be riskier and more unpopular to go against the flow. But as long as you have the right mindset and do your best to stick by them, you will ultimately be rewarded. Reframing your mind about money matters will help take you out of that rut and up the mountain.