I’m slowly working through a book called “The Millionaire Mindset” by T Harv Eker.
Now I must confess that this is not my usual type of reading matter. For a start it’s non-fiction; secondly, it all sounds a bit “woo woo” to me …. but it came very highly recommended by someone whose opinion and experience I respect, so I thought I’d give it a whirl.
As a result, I’ve been thinking a lot about my money mindset. How did I pick up my beliefs about money? And what messages did I receive as a child, and which I have likely carried with me throughout my life?
Childhood: when my money mindset was molded
I want to preface this by saying that my parents may not have even meant to communicate these messages to me, they may never have actually said these things, and probably never realised the messages I was receiving from them.
From my child’s perspective, I thought we were comfortably middle-class. We didn’t lack for any of life’s necessities – I knew there were people in my school with less, but at the same time, I was aware that some lived in bigger houses or had posher cars.
Here are some of the messages that have shaped my money mindset:
- Having more than two children is expensive. This was most likely because I was the eldest of four, it seemed that our fun and outings were often limited because “it costs too much because there are 3 (and then 4) of you.” Perhaps that’s why we were happy to have only two children when many around us went on to have more?
- Flaunting your wealth is vulgar. For example, we poked fun at the neighbours proudly driving about in their new car or anybody who seemed a bit posh.
- Brand names and labels are a waste of money.
- It’s okay to talk about money, interesting to talk about finances (I took this for granted until I met the husbear’s family, where it’s just not done).
- Buying your own home is important and provides security; it’s worth sacrificing for.
- You only borrow money to buy a home. For everything else, you save up and use cash.
- Money doesn’t grow on trees so you need to be prudent and consider any purchases wisely.
As a teenager, my money mindset was shaped by a change in our circumstances; our household income was primarily welfare-based. According to my mum we were barely scraping by (whether that’s true or not, is another story).
During this time, I heard things like (again I would like to stress that these were the messages I received, whether they were mixed, scrambled, true, false, intentional or not):
- We can’t afford it.
- Don’t look a gift horse in the mouth.
- Hang on to everything because you never know when you’ll need it.
- More is always better (quantity over quality).
- Education is the key to making money.
When I got my first credit card and a student loan at age 19 (so I could buy my first car – the idea being that I didn’t have to pay it back until I started teaching), I thought it was “free money”. My credit card was constantly maxed out and I only ever made minimum payments – classic money mistakes!
A year later when I first left home in difficult circumstances, I had no job, no income, no savings, plus a student loan and credit card debt.
Around the time I turned 21 a couple of things happened to correct my financial course.
I finally got a decent salary (in those days, you didn’t get proper “adult wages” until you were 21, regardless of whether you lived at home or not) and had more income than outgoings for the first time ever.
And, I started going out with the husbear, a man who had wise financial habits and encouraged me to develop the same. By the time we got engaged, I was extremely proud that I had paid off my loans, and even had savings in the bank!
Looking back on my early years, which experts say have the most impact on us, I can see why:
- A place to call home has always been important to me – to the point where I wasn’t really interested in travel as a young ‘un. I was much more interested in making a “nest”. When other young people were heading off on working holidays overseas, I was buying furniture. Things lasted. Holidays didn’t. (Now I would beg to differ … the memories of experiences like special holidays can be treasured for a lifetime!).
- Except for purchasing real estate, the husbear and I have never gone into debt.
I’ve mostly felt content with our financial position throughout our marriage, and definitely feel more comfortable now we have reached a stage where the years of scrimping and saving are paying off. It’s nice not having to worry about money any more.
Will my money mindset change as a result of reading this book? Does it need to? Am I fine the way I am, or am I limiting myself? What would I do if I had more money? Who would benefit? What could I do for others? Could I trust myself with it? Would I be responsible or wasteful? Why would I want a bigger and better house / car / whatever, when I like what I have now?
One issue that has come up for me is that I am clearly not comfortable with the thought of having wealth. Being comfortable is okay; being rich is not.
There are so many questions going around my head! I don’t have the answers, but thinking about all these things has got to be a good thing. Doesn’t it?!