🌼3 Habits To Stop ASAP If You Want More Financial Freedom(MUST READ)
“I may not always have a choice in what happens to me, but I always have a choice about how I respond to it.”
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Stop Having A Victim Mindset
Most people go through life with a victim mindset. They blame other people and external events for their financial circumstances.
But blaming others — even if it’s justified — doesn’t get you anywhere. It won’t help you build wealth. You only give your power away.
A more productive mindset is to take ultimate responsibility for your circumstances.
When you take responsibility, you put yourself back in the driver’s seat of your financial life. You gain back control.
As real estate investor Grant Cardone said in The 10X Rule:
“I didn’t allow myself to blame anyone or anything else as a justification for any hardships I encountered. I started to believe that although I may not always have a choice in what happens to me, I always have a choice about how I respond to it.”
This difference in mindset is what sets the most successful people apart from the rest.
Victim Mindset: I can’t save money because my boss doesn’t pay me enough.
Success Mindset: I’m going to apply for a higher-paying job or start a side-hustle.
Victim Mindset: My parents never taught me anything about investing.
Success Mindset: I can read the best investing books and learn everything myself.
Victim Mindset: I’m broke because the economy is terrible.
Success Mindset: I can learn high-income skills and earn more money regardless of the state of the economy.
You don’t always have a choice in what happens to you, but you always have a choice in how you respond to what happens to you.
And that’s what sets wealthy people apart from most others.
Yes, the economy might be terrible.
Yes, your parents might not have taught you anything about money.
And yes, your boss might not pay you enough.
But rather than blaming these things, decide to take ownership of your circumstances. Decide to take matters into your own hands and take action to change your reality.
As Grant Cardone said, “Once you start to approach every situation as someone who is acting — not being acted upon — you will start to have more control over your life.”
When you focus all your effort on what you can control — your actions, habits, and daily decisions — you’ll achieve far more than those stuck in a victim mindset.
Stop Having a ‘Get Rich Quick’ Mindset
The lottery is the most popular ‘get rich quick’ scheme of all. It tricks people — especially the most vulnerable — into believing there’s an instant path to wealth.
Studies show that the lowest-income households in the US spend more than $412 per year on lottery tickets — compared to just $102 per year for the highest-income group.
In other words, those who can least afford to waste their money spend the most on lottery tickets.
Combine this with the fact that 40% of Americans have less than $400 in their bank account — the exact amount they spend on lottery tickets per year.
As Morgan Housel said in The Psychology of Money:
“Those buying $400 in lottery tickets are by and large the same people who say they couldn’t come up with $400 in an emergency. They are blowing their safety nets on something with a one-in-millions chance of hitting it big.”
Gambling promises a quick and easy path to riches. But in reality, all gambling does is make you poorer. It keeps you further away from financial freedom.
And I can tell this from firsthand experience…
I’m a former gambling addict who lost his entire life savings (about $15,000) trying to get rich quickly. Believe me, it doesn’t work.
After hitting financial rock bottom, I decided to study the best finance books and learn how the wealthy manage their money.
I discovered one thing they have in common:
Financially smart people understand that building wealth takes time. They keep a long-term perspective and think in decades, not days.
When you stop believing in ‘getting rich quick’ and start accepting that building wealth takes time, you’ll automatically make better choices with your money.
For example, instead of gambling away $400+ per year, you could invest it in an index fund.
If you invest $400 per year at a rate of 10.7% (the average annual return of the S&P 500 since 1954), here’s what you could end up with:
5 Years — $3,141
10 Years — $7,698
20 Years — $27,868
30 Years — $83,609
40 Years — $237,656
50 Years — $663,383
That’s the power of compound interest.
Yes, long-term investing might be boring compared to the thrill and excitement of gambling or other ‘get rich quick’ schemes.
But remember, it’s not about excitement; it’s about securing your financial future.
As economist Paul Samuelson once said:
“Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.”
If you want to secure your financial future, don’t get tempted by gambling or methods that promise quick riches. Play the long-term game instead.
Start thinking in decades, not days.
Stop Having a Consumer Mindset
Most people go through life with a consumer mindset rather than an investor mindset.
Instead of thinking about how their money can be used to achieve freedom, they think about everything fancy their money can buy.
But as J.L. Collins said in The Simple Path to Wealth:
“It’s not hard. Stop thinking about what your money can buy. Start thinking about what your money can earn.”
When you’d give a random group of people $10,000 each, 95% of them would merely buy stuff with it — designer clothes, luxury bags, holidays, fancy watches, etc.
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These are the ones with a consumer mindset.
But 5% of people would use the $10,000 to improve their financial future. These are the ones with an investor mindset.
Rather than spending all of the money, they’d put it to work by investing in financial assets such as stocks, index funds, and real estate.
One way to shift from a consumer mindset to an investor mindset is to follow the ‘Rule of 5’ from Jaspreet Singh, CEO of Market Briefs:
All in all, people with an investor mindset use their money as a tool to reach freedom. People with a consumer mindset use their money to satisfy their need for instant gratification.
One will help you retire early, the other will keep you stuck in the financial rat race.
CONTRIBUTED BY Jari Roomer
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