“Change your thinking, change your life.” Frank Sonnenberg
If you want to be successful – in both your personal and financial life – you must have the right mindset. Essentially, your mindset represents the way you approach the world and what you believe to be true. When it comes to success, your mindset is the most important predictor of your future success in personal finance and life. Everything in life begins with your mindset, thoughts, attitude and habits.
Think of mindset as a set of attitudes, beliefs or ideas each person possesses. These attitudes, positive or negative, may come from your environment, home life and your personal experiences, or they might have been learned while at school. No matter their source, what you do to foster a positive growth mindset really does matter.
A growth mindset helps foster more positive thinking and a belief that intelligence can change, develop and grow. It is the belief that people can learn from their mistakes and that the brain is like a plant, always ready to soak up new information and knowledge. A student with a growth mindset might say: “I’m not going to give up,” “I’m going to keep trying,” or “I can do this.”
“Whether you think you can, or you think you can’t – you’re right.” Henry Ford
Success and financial security begins with your mindset. If you are determined to do something, and believe that you can achieve it, then you will find ways to succeed. Your determination to develop good financial habits and manage your money better are key to realizing your financial goals and achieving financial security.
Anyone can make a budget and have a financial plan to save for the future, spend less, and invest for the long term. But that is only 10% of the financial equation. The other 90% is how you think, how you behave and what you believe about money.
Your mindset is key to creating the life you desire and deserve. Your beliefs drive your habits and emotions, and in turn, these determine your behavior. If you believe you can, you will. You must believe that, “You are good enough. You are smart enough. You have unique and valuable gifts to offer the world and people notice and respect you for it.”
Studies have shown that allowing stress to overtake you can often have lasting negative effects on more than your mindset. Your health can be affected, your careers can be affected, and your entire lives can be affected!
David Bach, author of the best-selling book, The Latte Factor: Why You Don’t Have to Be Rich to Live Rich, says. “I’m super positive about things [long-term], but I think people need to be preparing themselves for volatility and rockiness.”
But there’s a silver lining to the downturn, Bach says: “Recessions create millionaires.”
If you believe that there is never ending potential to learn new things and grow in your talents, not only will you put yourself in new situations that could help you grow, you will embrace them with eagerness. Negative feedback is more fuel for growth, not something to be dreaded.
Or, according to Carol Dweck, a professor at Stanford and the author of Mindset, a classic work on motivation and “growth mindset”: “People with a growth mindset believe that a person’s true potential is unknown (and unknowable); that it’s impossible to foresee what can be accomplished with years of passion, toll, and training… Why waste time proving over and over how great you are, when you could be getting better? Why hide deficiencies instead of overcoming them? Why look for friends or partners who will just shore up your self-esteem instead of ones who will challenge you to grow? And why seek out the tried and true instead of experiences that will stretch you?”
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