So, let's talk about your relationship with money.
You may be surprised what a massive role a financial mindset plays in our financial well-being. How you think about money, the habits you've formed, and the emotions tied to your finances form the first layer of the financial freedom foundation.
So let's dig deeper and explore the main factors that impact our money mindset.
Identify your money values and beliefs 🌱
The first step towards building a healthy relationship with money is understanding your money values and beliefs. Our financial behaviour is often deeply rooted in the values and beliefs we've formed throughout our lives. Our upbringing, experiences, family, friends and surrounding can influence these. By recognizing and understanding these values, we can better align our financial decisions with our personal goals and aspirations.
So, how do you start identifying your money values and beliefs? 🤔
- Reflect on your past experiences: Consider what messages you received about money from your family, friends, and others during childhood. What money beliefs do you think were instilled in you? Have you been told money is a source of security, power, or happiness? Or the opposite - that it is scarce and you should always be frugal? Write down these beliefs, look at them over the weekend and think about how they might have influenced you.
- Determine your priorities: List what's important to you in life. Don't rush, and give it some thought. This could include things like security, freedom or comfort. Consider how your financial decisions align with these values. Are you prioritizing experiences over material possessions? Are you saving for the future by delaying gratification or living in the moment by spending money as they come? Reflect on how your current choices support your overall values and priorities regarding money.
- Analyze your financial habits: Now, look honestly at your financial habits. Don't lie to yourself. Do you tend to overspend, save obsessively, or avoid dealing with money altogether? Consider how these habits align with the values and beliefs about money you wrote down earlier. You can start making more informed money decisions when you understand the connection between your financial behaviours and underlying assumptions.
- Challenge limiting beliefs: When you truly understand where you are, challenging any limiting beliefs about money is essential. For example, believing that "money is the root of all evil" may prevent you from achieving financial success. And you will be surprised how many of these can resurface if you are honest with yourself.
- Set financial goals that align with your values: Now that you understand what matters most for you, it's time to set the money goals that resonate with you. That way, you'll be more motivated and feel good knowing you are true to yourself.
Remember, this is an ongoing process, and you must work on it daily, like going to the gym. Continually evaluate your current situation and make adjustments.
Embrace a growth mindset 🌳
Now, it's time to level up with a growth mindset!