It's important to learn the basics of personal finance, but the way you think about money is perhaps more important. A lot of personal finance experts have said this in one way or another, but I like the way Mr Money Mustache says it best: "Getting rich is more mental than it is tactical."
Australian money picture from Shutterstock
We've given you a ton of tips and tricks for saving, earning and managing money. While those tips certainly serve a helpful, practical purpose, your mindset makes a bigger difference to your finances. Here's how MMM explains it:
...there really is a pattern that shows up as people transition from desperate consumer to seasoned retiree. That pattern could be summed up like this: "Getting rich is more mental than it is tactical."
When people first start reading up on how we're all becoming rich here, their first questions are ones like these:
- "How could I possibly live on 50% of my income? Or 25%?"
- "How can I cut costs? What are your top three tips?"
- "Why is your electric bill a third of mine, and your grocery bill half?"
- "How will you pay for your healthcare? Your son's education? Valuable travel experiences?"
They're all good questions. But you'll notice that they are tactical in nature. People want tips and recipes for saving money.
Solid tips are valuable resources, but they work a lot better if they are combined with changes to your mind...
This isn't to say you should throw the tactical stuff out the window. Practical tips are still useful! But if you really want to feel in charge of your money, you might consider focusing on the mental part instead. And that means, for example:
- Embracing resourcefulness
- Taking action and finding ways to be in control
- Programming your mind to stop buying crap you don't need
If you're interested in turning your finances around, you'll definitely want to read the full post.
Is it Convenient? Would I Enjoy it? Wrong Question. [Mr Money Mustache]