Money mindset is a term that is thrown around a lot in the online coaching world, and it’s pretty similar to the law of attraction, but I have my own views about money mindset I’d like to share with you.
First off, let’s define money mindset.
I came across a book written by Amber Lilyestrom named Master Your Money Mind which I think is an excellent resource for money mindset, because not only does it educated on what money mindset and provide valuable examples, but it is also a workbook. It is far more helpful to work through the exercises and reflect on your money mindset rather than just reading about it.
I have linked the book to this article. Should you purchase this book through the link that I have provided on this page, I may receive a small amount of money. I do not recommend products that I do not believe in.
Money mindset: what is it?
A money mindset is your overall attitude towards money. Money mindset drives how you make key financial decisions in your life every day and it can have a big impact on whether or not you achieve your financial goals.
If you have a negative money mindset, you may have some limiting beliefs about how money should be handled in your personal financial affairs. If you are negative about money you may believe, whether consciously or subconsciously, that you do not deserve to have money, and therefore are always broke and in debt.
People who have a strong and healthy relationship with money, also known as a positive money mindset, tend to have accumulated wealth and invested their money wisely. Being financially healthy is important to them.
Having a positive money mindset in business
I am a firm believer that all entrepreneurs and business owners need access to resources specifically designed for business owners. Resources for business owners include having access to business finance information, along with any other information that affects their business.
I believe that all business owners should have a CFO money mindset.
You may be wondering why it would be important for business owners to create a CFO money mindset, especially if they have outsourced the bookkeeping and accounting functions to finance professionals.
Perhaps you depend on your accountant to check in with you and offer you financial advice, but have you considered how much more profitable you could make your business if you understood that financial information too? All the decisions you make in your business on a daily basis would be profitable if you understood how your decisions affected the profit line in your business.
A Chief Financial Officer (CFO) is a strategic thinker who understands the financial data and story that the business numbers are telling them. The CFO understands the important financial statements and knows how to read them. They value the feedback from these reports and use that feedback to implement changes in the business to improve efficiency and profitability.
The CFO understands the importance of creating a financial plan for a business and how to monitor the progress against that plan each month. And they understand that managing cash flow is paramount to a business’ survival.
When you are running a small business you are wearing multiple hats, and as easy as it is to depend on someone else’s expertise to take care of your business finances, not understanding your own business numbers is doing your business a disservice. I get it, accounting isn’t the sexy part of business. But it should be. It is the money management of your business. And money is sexy, right?
When you know your business numbers you will make your business more profitable. When you know your numbers, you understand where the strengths and weaknesses of your business are, you’ll know which offers to sell more of, where the money leaks are, and so much more beneficial information.
There are plenty of ways to adopt a CFO money mindset that will help you make your business more profitable:
Be a strategic thinker
It’s important to not only see the vision of your business, but you need to see the value of the numbers in your strategic plan and work towards your financial goals. You can increase performance, set higher goals, and achieve what you want. And when you fall short of your goals, you will know exactly why and how it happened.
Adopt a financial leadership mindset
As the CEO of your business, you need to have a money mindset. The purpose of the finance function is to drive business performance, and that’s what leaders do. Leaders are strategic thinkers, and it can’t stop at everything but money. Money is an integral part of your business, and you need to own that.
Set financial goals and see them through
Make financial goals such as sales targets and measure your progress against them. If you don’t have financial goals, you won’t have direction, and without direction you will not have a clear path towards anything. So create a plan to help achieve the financial goals in your business.
Money mindset and emotions
Let’s talk about money and how to manage emotions around money. Money is an emotionally charged topic, and the majority of people react to money in an emotional way. It’s completely expected.
If you react to money in an emotional way, it’s not necessarily a bad thing, but we’re going to talk about how we can try to take that emotion out of money and recognize money for what it is, which is a tool.
You need to take the emotion out of the money so that the emotion does not impair you from making the best possible business decision.
The common thread I have seen among clients and business owners is that many of them have made huge money mistakes in their business. I want to let you know that if you are one of those people, you need to let go of that mistake. I want you to stop beating yourself up with the shame and embarrassment around carrying that mistake.
We’re all human, and we all make mistakes. I believe that in every mistake there is a lesson to be learned. I know it sounds crazy to some of you, but I swear there is a lesson in everything. You just have to look.
Working with business owners and entrepreneurs for over 20 years I have seen a lot of financial mistakes. Some business owners were able to recover from, and for some it ultimately lead to the closure of their business.
If I can in any way help you as a business owner to avoid these mistakes or get help to recover from mistakes, I want you to know that I am here.
I’ll be sharing with you some important tips and tricks that I’ve learned through my over 20 years of business experience. I have indepth experience from working with startup companies to multimillion dollar companies and I see what gets businesses in trouble all the time.
I also have my own experience to share with you as I’m building my own 7 figure business.
Whether you are just thinking about starting a business, you have recently just started your business, or you’ve been in business for a few years now, you will gain some valuable information that you can apply to your business right away.
But the one tip which is so much easier said than done, is training or teaching yourself to take the emotion out of money. You need a strong money mindset.
Money is a tool, that’s all it is, it is currency that we use to measure the value of things.
But what if we stripped away the emotion about money, dissected it, and really tried to figure out what was going on?
Did you know that our attitudes and feelings were developed and formed back as early as our childhood, and subconsciously we carried them with us throughout our lives?
The brain is fascinating in how it works and I won’t claim to be an expert on this topic, but what I do enjoy doing with clients is unpacking these attitudes around money and help them discover the money mind-limiting beliefs that they’ve been carrying around
And believe me, I have done some work on my own mind-limiting beliefs around money. I consider myself a pretty self-aware person, so when I discovered my own limiting beliefs, I was a bit surprised.
I grew up in a house where money was spoken about openly. My dad spoke with all of us openly about money and he taught us how to manage our money and build wealth. I was very lucky that way and I am very grateful for all he’s done for me.
In so many families money can be a taboo subject, but in my family I know the financial position of my parents, my brother’s family, my sister’s family, and they all know mine. I knew the financial position of my grandparents and we all spoke about money.
That’s probably where my passion for money lies. All through my early 20s to now I have studied all things related to personal finance, and in my career I have studied all things related to business finance.
But through working with women, and men, and having so many money conversations with people, I have heard all types of stories about people’s relationships with money.
Fear, shame and anger are the most common emotions surrounding money.
We all think that money is about our bank balance. Yes, of course, it is that too, but money is also strongly connected to emotions. And before you think that you are exempt from an emotional attachment to money, think again.
Sometimes our feelings towards money are so strong that we start to hate money because we believe that it is the cause of all of our problems. Hate is a strong emotion. But it’s so easy to believe that our world is out of control because our money situation is out of control – and we’re forgetting that we in fact are the ones who have control of our money.
On the flip side, tell me how you will feel if you suddenly got news that you won the lottery, or inherited a vast sum of money? Elated, right? Relief — end of my money problems. I’m free! Or so you think.
But you hear of so many lottery winners that lost it all. They spent it all. It was out of control behaviour.
A sudden large lump sum of money even changes people. Money gives them status and makes them feel powerful. Suddenly an air of arrogance sets in.
Money also influences how people treat you. A homeless person walks into a high-end retail store and gets shooed out with contempt. A well-dressed man pulls up in a BMW and has the welcome mat rolled out for him. People have more respect for wealthy people.
That’s the power of money.
Our thoughts about money often stem from childhood. How our parents handled money provides the foundation for how we may handle money. This is reason generational poverty and generational wealth exists. Poor people impart bad money habits and beliefs to their children. On the other hand, wealthy people tend to impart their philosophies and strategies on wealth creation to the children. Coupled with that is the inability of poor people to fund further education for their children and the advantage children from wealthy homes have right from the start, and so the cycle continues.
Add to that the fact that formal schooling does not include financial education, and so we go into the world with little or no financial roadmap and soon we are making bad financial decisions, running up debt and have ourselves in a financial mess in next to no time.
The truth is that the problem isn’t money. The problem is how we approach money, how we think about money and how we handle money. People who constantly think negatively about money, tend to be plagued by money problems their whole life. People who believe that money is something within their control, are the ones who become more successful and ultimately increase their money. Those are the people who instead of complaining about their lack of money, educate themselves about money. Financial intelligence is the basis for growing wealth.
A change in our financial situation starts with a change in how we think about money. Clearing out the negative thoughts about money will remove the blockages that are preventing money from flowing to us.
While we should examine our feelings towards money and strive to manage money better, we should not allow it to consume us.
We all need money to live and money does make life easier and more comfortable and gives us access to better services.
Money should enhance our lives, not run it.
What we should be striving for is to develop a healthier relationship with money.
Money has such a powerful impact on people that a sudden gain or loss in money can have a profound effect on some people’s personalities and attitudes. It can turn a nice person nasty or a happy person miserable. It can inspire greed and selfishness. More money can actually be a bad thing for some people.
But in most cases, money will not fundamentally change who you are or what you believe. At your core, you will still be the same person with or without money. Similarly, if you are bad at handling a little money, you’ll be bad at handling a lot of money.
As a business owner you need to create confidence around money and around cash management in your business.
Overcoming a negative money mindset
Change your money story
Regardless of your upbringing or childhood stories that told you that rich people were assholes, or having money made you a bad person, or that there would never be enough money – whatever that old story is, let it go.
Let go of past money mistakes
Everyone has made mistakes, and everyone has made money mistakes. Big mistakes or small mistakes, money can be replaced. You can always make money. If you have made a money mistake and you’ve punishing yourself for years, you need to let it go. You need to understand that mistakes are lessons and when you know better, you do better.
Practice gratitude
Be grateful for everything that you have today. You have what you need. Tomorrow is another day to make more money but be grateful for where you are. The journey is such a large part of the fun.
Do I need a money mindset coach?
There are plenty of money mindset coaches out there. And although I do believe that there are good coaches out there who can help with mindset issues, I also believe that getting your financial situation in order is the best remedy for a negative money mindset.
Once you start putting good money practices in action, it increases momentum and allows people to feel so much better about their situation.
Money mindset quotes
Money mindset quotes can be incredibly inspiring and motivating. Collect quotes that resonate with you and leave them around your environment as a reminder that you have chosen to be positive and nurture a positive relationship with money rather than a negative one.
The bottom line is money is a tool. Sometimes it’s easy come and easy go. So, the important thing to remember is the health and safety of you and your loved ones are paramount and if losing a financial fortune has happened to you, like it has happened to many entrepreneurs, you will recover from that.
Money can always be replaced. Health of family and loved ones cannot.
I came across a book written by Amber Lilyestrom named Master Your Money Mind which I think is an excellent resource for money mindset, because not only does it educated on what money mindset and provide valuable examples, but it is also a workbook. It is far more helpful to work through the exercises and reflect on your money mindset rather than just reading about it.
I have linked the book to this article. Should you purchase this book through the link that I have provided on this page, I may receive a small amount of money. I do not recommend products that I do not believe in.
[…] a strong money mindset in business and personal financial management is a skill and tool that will not only help you make a lot more money, but will give you confidence […]