
You probably know the basic personal finance principles: lower your expenses, increase your income, keep a budget, and try to save and invest as much as possible.
However, these days, in the aftermath of an economy-shaking pandemic and volatile geopolitical issues, the cost of living is higher than ever. Inflation makes it costlier to purchase even the bare essentials, and ‘tightening your belt’ just isn’t helping anymore.
But while you might be familiar with the primary (and essential) principles of personal finance, the most critical and effective financial tool is the right money mindset.
When you begin to change your mindset about money, you’re that much more capable of succeeding at the basic personal finance principles. You can develop money mastery by taking a few simple steps outlined below. Let’s dive in.
What Exactly Is A Money Mindset?
Your money mindset is based on your core beliefs and emotions associated with money: the many experiences you’ve had with money influence the way you think about it and your attitude toward it. A money mindset is often developed from a very young age, and these beliefs are galvanized and ingrained over time.
This mindset can be either positive or negative, healthy or unhealthy. But no matter how unhealthy your money mindset currently is, you can modify it to better serve your financial stability.
A Healthy Money Mindset
People with a healthy money mindset have the following outlook:
- Money is a helpful tool to reach goals and grow.
- There is no need to compare your financial situation to others.
- Anybody can learn how to be financially successful by applying basic principles.
- All financial goals are achievable with the right plan and discipline.
An Unhealthy Money Mindset
People with an unhealthy money mindset tend to:
- Be fearful of money.
- Spend indiscriminately and only live for the moment.
- Doubt their ability to earn money and believe they’ll always be broke.
- Constantly compare their financial health to others.
The Formation Of Your Money Mindset
As mentioned, your money mindset starts early, much like your general outlook on life. Therefore, how your parents and family interact with money significantly affects your own mindset.
Your personal journey with money is also a determining factor. Everything from your experience at your first job to earning your first paycheck influence your behavior regarding money, whether you tend to be careful or reckless with the money you earn.
The comfort of a safety net plays a big role too. Unhealthy habits with money often start young, perhaps due to the availability of financial safety nets like parents. People who learn to be reckless with money from a young age often maintain those bad habits.
Confidence in the amount of money you can earn based on your various skill sets and education also plays a significant role in your financial mindset. It is much easier to save and invest money if you’re confident in your ability to maintain gainful employment and do not have to live paycheck-to-paycheck.
That said, many low-earners have a positive money mindset, and many high-earners have a negative money mindset. The ability to master a productive money mindset is not based on your income; in fact, this mastery can help you earn more and make the most of what you currently have.
Changing Your Money Mindset
Your money mindset can be changed at any stage of your life. It doesn’t matter how old you are, how much or how little money you have, or how many times you’ve tried and failed. So let’s take a look at five ways to shift your money mindset from negative to positive.

1. Improve Yourself With Knowledge
The wealth of financial knowledge out there (pun intended) provides expert advice regarding productive financial habits.
Read books about money, sign up for seminars about becoming financially responsible, and absorb the advice of people who successfully implement skills and habits that cultivate a positive relationship with money. Avoid the get-rich-quick schemes, and instead, focus on established and credible advice from the experts.
2. Stop Obsessing About Money
It might sound ironic, but often, obsessing and panicking about money can hinder your progress to a positive money mindset. Most very successful people will tell you that they didn’t focus solely on money when they started. They became obsessed with ideas, opportunities, and improving themselves in their craft or trade. Focussing only on money will often lead to an unhealthy money mindset and bad habits.
3. Positive Affirmations
Affirmations and mindful meditation can help shake even the strongest unhealthy money mindsets. It’s all about repeating achievable and hopeful mantras about money, as well as visualizing yourself succeeding in your career or business. There are some great techniques out there, but you must have the discipline to maintain that mindfulness. Choose the method that works for you and integrate it into your lifestyle – the key is to make it a habit.
4. Stay In Your Lane
One of the biggest mistakes you can make is to constantly compare yourself to others. That’s not to say you shouldn’t view the success of others as an inspiration. But obsessing about what others have will waste your time and energy; it will also demotivate you if you feel that certain levels of wealth are unattainable. Remember, there will likely always be someone with more money than you. So achieving your financial goals is not about comparing yourself to others’ financial achievements; it’s about doing the very best that you can do.
5. Be Gracious and Humble
Being grateful for what you have, helping others to succeed, and showing humility under any circumstances will necessarily help you become a happier and more successful person. It’s also just good business sense; with this attitude, you’ll make more friends, be more likable, and attract more opportunities and career success.
Following these five steps will help you develop a masterful money mindset. You, too, can be financially stable and enjoy a less stressful, more productive relationship with money.
I have a positive mindset. I am very grateful for what I have. I’m always donating things to others and collecting items for my church to pack in Operation Christmas Child Shoeboxes. If there’s anyway someone can allow me a loan, I would be very appreciative.
Hi Teresa. Lenders with LoanAssist-USA, NewDayLoans, or Citrus–Loans offer loans up to $20,000. We recommend checking them out.
Best of Luck,
The AssessmentOption Team
Thanks for the information.
I need a loan for down payment on a car and have emergency dental issues.
Who will help me
Hi Tabitha. Have you checked out LoanAssist-USA or NewDayLoans? We hope they can help!
The AssessmentOption Team