When it comes to your finances, it pays to have a positive outlook. Over the years, you might have accepted certain myths about money or developed habits that make it difficult to build wealth. No matter how fixed your habits may seem, you can change them with enough work. The first step is to develop a positive money mindset. Here are a few adjustments you can make to start you on the path to positivity.
We’re all familiar with the feeling. Your neighbor, friend, or family member gets something shiny and new, and you find yourself wanting that item or something similar. If you regularly scroll through social media, you might begin to feel envious of someone else’s extravagant lifestyle.
When you compare your own situation to a carefully curated set of images, there’s a desire to “keep up with the Joneses.” That impulse could cause you to increase your spending and ultimately derail your financial goals.
There are a few things you can do to break the habit:
Have you ever had a rough day at work and end up tossing a few candy bars into your cart during your grocery trip? Or maybe you’ve recently gotten some great news, so you decide to splurge on a new pair of shoes?
Emotional spending happens when you buy something you don’t really need and may not actually want in response to a feeling, such as stress, sadness, frustration, or even happiness. The way to curb emotional spending is by recognizing the things that trigger the impulse to shop.
The next time you find yourself about to make an impulse purchase, take a minute to examine the feelings behind it. Are you buying the item to counteract negative feelings? Are you about to buy something because you’re feeling good and want the feeling to continue?
Once you’ve started to recognize spending triggers, create boundaries for yourself. If you’re tempted to buy something you don’t need, wait at least 24 hours before you purchase it. Put the item back on the shelf at the store or close the browser tab online. It’s likely that after 24 hours, you’ll have forgotten about the item entirely or won’t want it anymore.
Everyone makes mistakes from time to time. If you have any money regrets in your life, such as maxing out a credit card, one of the best things you can do for your mental and emotional health is to forgive yourself.
You don’t have to forget your past mistakes after you forgive yourself. In fact, remembering them is essential for growth and to help you build a positive mindset. Reflect on the consequences of a mistake, such as borrowing more than you could comfortably repay. Then, ask yourself what you can do going forward to avoid making a similar mistake.
Although money and finances are often treated as taboo topics, the more you talk about them, the better you’ll feel. Recognizing that other people have similar financial regrets or feel the same way about money can help.
In some cases, talking to a professional, such as a financial counselor or therapist, can help you better manage your spending and emotional response. You can hash out your concerns with a counselor and make a plan to move forward.
The key to developing a positive money mindset is teaching yourself that you are in control of your finances. You can make decisions about what you buy and what you save. You even have control over how much money you bring in.
One way to take control of your finances is to create a budget or spending plan. Creating a budget can involve a bit of trial and error. Some people use the envelope method, where they allocate cash to envelopes for specific purchases. In doing so, they stay on top of their spending. Others use a zero-based budgeting method. With zero-based budgeting, you assign every single dollar you earn a purpose. At the end of the month, your income minus your expenses and savings totals zero. Try out one method, and if you find yourself struggling with it, pursue a different option.
A positive money mindset can help you feel better about yourself. It can also help you reach your financial goals. To learn more about money management, visit our WalletWorks page.