Money Mindset: Why it matters and how to improve it

Your money mindset can have a huge impact on your financial success, influencing how you handle debt and how you set and achieve your financial goals. Can the secret to financial stability and even wealth be as simple as a change in attitude?

In this post, our resident money expert Kate Bradley will examine the money mindset and how understanding and improving yours could open the door to financial success.

What is a money mindset?

A mindset is the overriding set of core beliefs you have towards everything in your life. Your mindset drives you to make key decisions every day, and it can have a big impact on why you make certain decisions in your life.

A money mindset is a mindset you have towards your finances. Your money mindset shapes what you believe you can and can’t do with money, and can extend even further to beliefs like your earning capacity, how much you’re allowed to spend, how you utilise debt, and whether or not you’ll invest your money.

Many of our core financial beliefs stem from our parent’s attitudes towards money. We learn the bulk of our finance skills and beliefs throughout our teens and early 20s, and we disburse these beliefs to our friends and family throughout our lives.

Think back to your childhood. How did the adults around you speak about money? Did your parents fight about money, or did they talk everything through calmly and get input from the whole family? Core beliefs around money can significantly impact your financial status as you get older. For example, you may unconsciously put a cap on the amount of money you earn, to avoid association with the negative emotions your family has around “rich people”.

Understanding your money mindset

Understanding your money mindset, and your personal money story is the first step in helping change it. Just like you need to track your spending to create a realistic budget, you need to understand your damaging money habits and mindset in order to grow bigger and better.

The way that you speak about money is a good indication of where you are in relation to your money mindset. Do you feel like you can confidently speak and contribute to money discussions, both at home and socially? Or do you feel intimidated and embarrassed talking about finance?

Shifting your mindset starts with awareness. Paying attention to your thoughts, feelings, and actions can help you to start shifting your money mindset. By determining your current money mindset, you can see where you are starting from, and understand the ways that you can start to shift your mindset.

Here at Being More Human, we categorise the mindset of individuals into 5 categories. These categories are from the mindset model created by our Chief Conversationalist, Michelle Crawford, and include the sufferer, survivor, passenger, driver, and thriver mindsets.

The 5 categories of a money mindset

1. Sufferer Mindset

   Someone that falls into the sufferer mindset often has a history of complex trauma and has learned over a series of events to become helpless. They believe that they are not the cause or the effect of anything in their own lives, and are often bitter and resentful.

   From a money perspective, people in a sufferer mindset do not have any financial goals, are in a state of turmoil, and feel helpless when it comes to money. They believe that they will always be terrible with money, and there is no way out of debt.

2. Survivor Mindset

   A person experiencing the survivor mindset is the equivalent of a person who has survived a major trauma. They have shown their bravery by leaving the situation they were in, but still feel angry and feel defined by the past.

   From a money perspective, someone in a survivor mindset lives paycheck to paycheck and relies on credit cards to get them out of emergencies. They act impulsively when spending and complain frequently about not having enough money.

3. Passenger Mindset

   Someone who falls into the passenger mindset accepts the status quo and is a good follower who will not do anything innovative or extra in their role or life. They will do the bare minimum and will not cause a fuss whilst blending into the background of their own lives.

   From a money perspective, they will accept what someone else decides to be their maximum earning capacity, and they will not change their financial habits unless they see the majority of people do it before them.

4. Driver Mindset

   These are the people who hustle, push and make it happen. People in this mindset will seem outwardly successful but only in a one-dimensional way. They will not live a holistic life and will often have lives that are skewed towards work.

   From a money perspective, they work very hard to make extra money, often engaging in one or more side hustles, while only being moderately successful. They will tell everyone in their life about their success but can become overwhelmed easily due to juggling multiple goals and priorities.

5. Thriver Mindset

   The thriver mindset is the one where people believe in cause and effect. They believe that their thoughts and beliefs create their reality. The people in this mindset are adept at changing those thoughts and beliefs to give themselves a more constructive version of how things are in their world.

   From a money perspective, these people are successful and have multiple streams of income. They engage in constant education regarding money and change their strategies if required. They don’t focus on broadcasting their success to others and know that money is readily available in their world.

The goal for everyone would be to move towards a thriver mindset in all aspects of their lives, not just for their money mindset. If you would like to find out which money mindset you are currently in, take our quiz to find out!

5 tips on how to shift your money mindset

There are a few steps that you can take to start to shift your money mindset towards a thriver mindset. They are:

1. Get educated

   Read some books, listen to some podcasts, attend a workshop or engage a money coach. All of these options are great to help increase your financial literacy and put you on the path to doing more with your money.

2. Understand your money story

   Write down all the beliefs that you have around money, and see if any of those beliefs or habits might be holding you back.

3. Give generously

   Giving money away is one of the most selfless things that we can do, and it really helps to start to shift your mindset from selfish to selfless. Try giving back to an organisation or person that you feel can benefit from the money, and take notice of how you feel after doing it.

4. Dream about your life

   What does your ideal life look like? Let this be the motivation to start to shift your mindset and change your financial future. Write it down, create a vision board, and set some goals!

5. Have the belief that success is possible

   you have the power to change your life. Unfortunately, no one is coming to push you to change your situation, and the only one who can change your life is you. Some people experience bigger and more complex obstacles than others on the road to success, but believing is the first step.

If you want to learn how to up-level your money mindset and make some good, long-lasting money habits, make sure you book in to see our Money Coach Kate Bradley.

Kate Bradley - Money Coach

Kate Bradley has over 10 years of experience as a small business accountant and advisor. Kate brings her significant experience advising on the financial aspects of small business to the BMH team , with a particular focus on the optimisation of systems, budgeting, profitability, and cash flow management.

Kate is extremely passionate about financial literacy on both a business and personal level and strives to empower individuals to take hold of their own financial freedom through education and development. Connect on Linkedin.