A Healthy Attitude Towards Money Helps to Achieve Financial Security
By: Christian Soschner
Tags: Self Improvement, Money, Financial Literacy, Wealth, Success

How to apply it:

Analyze how you deal with money and ask yourself some questions:

Do you believe that wealthy people are evil?

Do you believe that money is a god?

Do you believe that money makes you a better person?

Or that it’s best to hide your accomplishments because otherwise, people would try to steal your money?

If you tend to feel anxious or angry or are overly emotional when the discussion comes to money and the rich, there might be something going on that could be worth talking with a specialist.

Canva Pro Image

Create the right money mindset habits — step by step

“Money is a tool. Used properly it makes something beautiful; used wrong, it makes a mess!” — Bradley Vinson

Nobody should attach any emotion to money; it is not worth it. Money has no meaning — it is just a tool that everybody can use to achieve their own life goals.

Nothing more, nothing less.

If you feel pleasure in making music and feel your calling teaches kids how to play instruments, maybe it doesn’t need billions to need a happy, fulfilled life.

Others might feel a calling to create something like Amazon, which needs more money to realize such a calling.

The process I recommend is the following.

Figure out your life goals

At the beginning of this article, I described the importance of finding your own vision and passion as the key to a happy life.

I consider this the first step to financial independence. It creates the north star that guides you toward creating a fulfilling life for you.

Make the vision as big as possible and always remember — achieving the exact goal is not its purpose. The bigger the goal, the bigger the things you achieve will be

Set money goals accordingly

In my eyes, only after the initial step, it makes sense to plan a budget that meets your goals.

Let’s go back to the example with the teacher whose life goal is to educate kids in music.

Why should this teacher take up 3 other jobs when the financial life may be set up that it has 50,000 expenses at 70,000 annual income. To make it easy, let’s just assume it is after taxes.

Yes, having an additional 100,000 is a nice thing, but if the music teacher has a fulfilled, happy life because he can teach kids every day what he loves, why should he make himself unhappy with a second job?

Knowing the first step is a prerequisite to set the money plans accordingly. Otherwise, it is easy to end up chasing money for no reason.

Whatever you want to achieve, my thumb rule is annual expenses plus a 30% profit span is enough income to create reserves for retirement.

Work on your money mindset

After figuring passion, vision, goals, and budget needed out, question your mindset if you consider the whole picture odd.

It might be that the picture is right, but your mindset is a little bit off.

In some cases, it might look like raising billions is necessary to achieve your new goals, and you might consider it impossible. It reflects a scarcity mindset.

An underlying cause might be a money disorder, like

“I don’t deserve so much money.” or

“Rich people are evil. I want to be a good guy. That’s why I need to be poor.”

Or it might be that you figure out that an annual income of 100,000 is sufficient as your goals only need 70,000 per year. You decide to take up 2 other jobs because you believe that people will respect you more. Such is a money status and worship disorder.

A goal needs a supporting mindset.

Learn how to make money, save and invest

A lot can happen in life. Sometimes goals and priorities just shift.

It is a natural process that human beings evolve and might want to set new goals every 5–10 years.

Each of these transitions takes time. The natural process I learned is that initially, everybody has to invest time and money to start something new.

It is a huge risk because it is unknown whether this investment pays for the long-term, and very often, entrepreneurs can only thrive on faith that eventually it will work out fine.

That’s why I recommend starting to think about creating several streams of income.

One might be saving for bad days once a certain threshold is achieved moving forward to investing in stock and real estate or other asset classes.

I highly recommend to check out seminars and webinars that teach the necessary skills and start working on the trial and error learning process.

Create good daily financial habits

Building wealth is the result of disciplined habits. Every person who sticks to the plan will increase the net worth automatically.

I am describing in my articles on the subject “Financial Literacy” some of them.

One of the habits that benefits me the most is actually very simple.

In my eyes, one of the biggest money wasters is impulse buying or out of control shopping.

Did you ever find yourself home after a Saturday with 5 shopping bags full of stuff that you actually don’t need? And regret to have to spend a thousand euros on that?

Marketing hijacks our limbic system and creates the illusion of gratification when buying stuff.

The reptilian brain first wants to know if the thing is threatening or desirable and ascertains this from what it can see, smell, taste and touch, not what it can deduct by rational means.

Knowing this, it is understandable that marketing uses words, sounds, and pictures that show the sunny side of life to us- it works hard to make the limbic system believe that things are desirable.

Only after an input passed the amygdala, our brain rationalizes whether it makes logical sense or not. What marketing doesn’t want is to induce a fight or flight response by threatening the potential customer.

On top of this, mechanic science shows that shopping raises the dopamine levels in our body. Dopamine is the gratification hormone whenever we experience something.

Scientists discovered that dopamine levels are regulated by excitement and anticipation.

Marketing creates excitement around a product — and uses discounts to make the experience more pleasurable. Did you ever feel the joy of getting a product for 30% less?

And when it is unpredictable whether the event occurs tomorrow or next week, it creates an additional dopamine rush.

That’s why online shopping works mostly better than real-life shopping as people have to wait until the parcel is delivered.

Knowing all this, it is clear that impulse shopping — online and in real life- happens as humans like the effects of dopamine, and there is nothing bad in it.

But for some, it can become a problem as the shopping behavior drains the budget and sometimes make people spend more than they actually have, pushing them into debt.

So I developed for my life a simple method, and here is

How to apply it:

Whenever I feel the urge of wanting to buy something, I don’t immediately follow this impulse.

Instead, I put the item on a shopping list. (except grocery shopping and expenses for education like books)

These days I use a simple app with a shopping list and links to the products.

I announced Saturday as my shopping day, where I get all the shopping needed for my life done.

On this day, I agreed with myself to check one item off the list by purchasing it.

Only one item each Saturday.

The upside is that I have to think about what goods I need the most and which one has the highest positive impact on my life.

Additionally, after reading the studies about dopamine and shopping, delaying the behavior's gratification produces an additional dopamine rush.

Canva Pro Image

Meet like-minded people.

“You are the average of the five people you spend the most time with.” ― Jim Rohn

Whether we like it or not, we become like the people we spend the most time with.

If you want to learn more about yourself, make a list of your family, friends, acquaintances, business partners, or work colleagues.

All people you are in touch with during a month and then rank the list according to the time you spend with the people.

Look at the top 5 people — most likely, you are very similar to them. Of course, all people influence us, but the top 5 affect our personal development simply by mirroring their behavior, values, and habits.

Successful people know when they want to change direction to amend their circle of close people.

The concept is simple:

When you want to become an ultrarunner, spend time with ultrarunners.

When you want to become a millionaire, spend time with millionaires.

When you want to become a successful entrepreneur, spend more time with successful entrepreneurs.

Some might say, well, I don’t know any rich people — does that mean I can never become rich?

The good thing in 2020 is — the internet.

Of course, having real life contact with other people is the best possible way to learn from them.

The second-best solution is reading books, reading websites, listening to podcasts, and audiobooks of people that have already achieved what you desire.

The latter option is a great and quick starting point. You want to go in a new direction? Define your goal and get some books, podcasts, and websites and start reading — an easy first step.

In parallel, reach out to people in real life. Everybody is interested in meeting new people, especially when it means helping another person.

You can pay successful people as advisors for financial goals, and most likely, they are happy to help you as a mentor or coach.

How to apply it: