Have you ever wondered if there was one thing that you could do, one thing that you could change, that would have a positive and lasting effect on every part of your finances?

Imagine not having to be as frustrated about money in general. Imagine how it would feel for things to be looking up, for things to turn around and start going in the right direction.

Before you click away, know that this is not some sort of sales pitch. Also, this is not something that’s too good to be true. This is something that I’ve personally gone through and successfully done.

The one thing that you can change is…wait for it…

Your Mindset

That’s right. Change your mindset on money and it will have a positive impact on literally every part of your finances.

Why is mindset so important?

Webster’s dictionary defines mindset as a person’s attitude or set of opinions about something. This attitude and set of opinions defines and informs everything from our view on the world and others to how we make decisions.

Take a college student, for example. A college student who does not have the correct mindset on learning may slack off and complain that some of the courses they are required to take won’t be beneficial to them. They may not realize that you can learn something from every situation.

Having a poor money mindset will prevent you from ever achieving financial freedom. Let’s face it. There are a lot of lottery winners who end up right back where they started despite winning millions of dollars. If you don’t now how to view money, you won’t know how to handle it no matter how much you have.

Two Types of Mindsets


There are two types of mindsets that are prevalent these days. One is a fixed mindset and the other is a growth mindset.

A fixed mindset is a belief that talent or having a knack for something is essentially “just the way you were born.” For instance, one person who doesn’t have much musical talent may think that they could never do the sorts of things that Frank Sinatra or Adam Levine or Rihanna might be able to do. This is a fixed mindset.

A growth mindset is a belief that we can develop our abilities through hard work and perseverance. With a growth mindset, that same person above knows that behind the ease and talent on stage is years of hard work. They know that if they want to do the same things “the greats” do, they just have to work hard and keep moving forward.

Let’s apply this to finance.

There are some people who think that they will never get the hang of personal finance. They think that they are destined to just mess up with their finances no matter how hard they try. This is a fixed mindset.

Then there are those that may have made some mistakes, but they know that with some hard work, they are going to be where they want to be financially. They know that eventually they will be financially free. This is a growth mindset.

Which One Are You?

Do you have a fixed mindset or a growth mindset? Which one do you want to have?

About 10 or so years ago, I had a fixed mindset. I was set in my ways with spending, living paycheck to paycheck, and saving literally nothing. My wife and I borrowed $10,000 from her Grandma with the intention of using it as a downpayment on a house. Most of that money was spent within about 2 years on things like shopping and eating out.

We gained a little bit of money throughout the years as we got minuscule raises. We never really managed our money though. I made sure that we didn’t go negative on our checking account, but that didn’t stop us from spending on credit cards. In fact, part of the reason I derailed our get-out-of-debt train in 6 months flat about 4 years ago was because of a poor mindset.

Time For Change

A couple of years ago, I was fed up working where I was at. The hours were terrible, I was constantly sleep deprived, and it was starting to break up my family. My wife was miserable because I treated her like crap, and I was always yelling at my two little girls. I was convinced that I was going to be stuck for the rest of my life.

Have you ever been in a situation like this?

The job I was in paid well, and the lifestyle of spending because I was miserable pretty much kept me where I was. I had a terrible mindset. It was beyond fixed. I was stressed like crazy. I didn’t see an end in site.

At this point, I was ready to make some drastic changes. I found a job with a better schedule, but to get it, I had to take a $15,000 a year pay cut.

Now this is something I was not willing to do before, but it was getting to be too much. I went for it!

Little did I know that this was one of the steps I would take to shift my money mindset. I was sick of the way I thought about money. At that moment more than ever, especially since I was taking such a large pay cut, I needed to think about money in a new light.

Have you been in a similar situation before?

Are you there now? Are you sick of the way money makes you feel no matter how much you have?

I was miserable making $15,000 more a year! Money certainly isn’t everything, but how you think about money can make or break your finances.

What’s Next?

What if you are in the same type of situation? Are you ready to jump ship on your current mindset? What can you do to change your mindset?

There are six things that you can do to change your mindset on money. Each of these six things I’ve done myself so I can guarantee they work. Some of them I continue to do. They are:

  1. Discover how you feel about money
  2. Realize that money is a tool
  3. Give yourself a pay cut
  4. Appreciate what you have
  5. Giving
  6. Budget for fun

Let’s go just a bit deeper into these.

Discover How You Feel About Money

This is always going to be step one. If you don’t know how you feel about money, you won’t know that you have to change nor will you know how to change it.

What is money to you? How does it make you feel when you have some? How does it make you feel when you don’t?

Think about what you would do if someone dropped a lot of money in your lap right now. I’m talking like a cool million or two. What would your first thought be?

Would you immediately think all of your problems are over or that you can quit your job and spend wildly? Or would you take that money, invest it, pay your bills from the interest and then find a job you would enjoy doing for spending money and to make a difference?

Realizing what your immediate thoughts would be if you received that much money is a good start in figuring out how you feel about the green stuff.

Realize That Money is a Tool

This is the next step. Money is not your friend or enemy. It doesn’t make you do what you don’t want to do. It doesn’t convince you to spend it like the devil on your shoulder.

I used to think that money would make everything better. I could have nicer things, go out to eat more, buy whatever I wanted, and actually look like I meant something. Very. Bad. Thinking.

Money is a tool, like a hammer, that can either be used to build or to destroy. Same tool, different uses. Because I didn’t realize it was a tool, and I had the wrong mindset. I was using it to destroy and continue to trap myself in the situation I was in.

Give Yourself a Pay Cut

In order to get out of my job, I had to take quite the pay cut. $15,000 per year is a good chunk of change. I was basically starting from the bottom at my new position, and my salary reflected that.

Now this doesn’t mean that you should look for a new job just to take a pay cut. You could be perfectly happy in your job but still have the wrong mindset on money. There are artificial ways to make it feel like you don’t have as much money as you do.

You can set up automatic transfers to your savings account on payday. In fact, if you have direct deposit, your employer may have the ability to deposit your check into multiple accounts. You can have them deposit $100 from every paycheck directly into your savings account. That way you won’t even see it in your checking account!

If you are going to be giving yourself a pay cut, whether artificial or actual, I do recommend you try slimming down your finances.

Appreciate What You Have

I can guarantee if you look around you, you’ll see that you have it a lot better than a lot of other people. There are people who are homeless that go to sleep on a park bench or against a brick wall every night. Do you really need that new iPad when the one you have works just fine? Preaching to myself on that one.

Another thing that not appreciating what you have leads to is the inevitable “Keeping Up with the Jones’s” syndrome. If you don’t appreciate what you have, it leads to envy. Envy leads to more spending and bad relationships. I’ve been there. Anger would set in, sometimes toward the person that had purchased something I really wanted but couldn’t afford. If they had the type of life I wanted, I would get upset and jealous.

I had to flip this around and examine what I had already–and what was important.


How do you feel when you take a friend out for lunch? How about when you give that homeless person on the street a warm cup of coffee in the winter. Sure, that cup didn’t change their situation. But that cup of coffee gave them the confidence that there is some good in the world, and sooner or later, some of that good is going to turn their situation around.

When you stop looking at people just to see what you don’t have (remember, appreciate!), then you start to look at people and see what they need. You could notice someone nervously fumbling around for money in their wallet or purse at the grocery store and then asking to take some items off of their bill. What if you were to pay for their groceries?

Instant mindset shift.

Budget for Fun

With all of this hard work, the one thing that will keep you sane and solidify your mindset shift is making sure you reward yourself. Budget for the fun stuff too. It gives you something to look forward to.

It’s also easier to actually keep your mindset shift. Think about this.

When you are trying to get in shape, if you start by going all out, you will end up burning yourself out and quitting. Then you go back into the habits that got you out of shape in the first place and you’re back where you started.

What if you were to start small and ramp up? What if you were to start by walking for a half hour and then lifting some lighter weights? You would have energy to keep going! Your body would get used to it and you can change it up by jogging for 15, walking for 15, and then lifting some heavier weights. It makes it doable.

Budgeting for fun makes all of the other mindset steps doable.

What Should You Do Next?

If you’re looking for a deeper dive into these money mindset changing tools, then I highly recommend you download my free ebook guide on how to change your mindset on money.

I go into each of those steps more than a simple blog post allows including some tell-tale signs that you need a money mindset shift. Fill out the quick form below to get your copy.

I’d love to hear your thoughts on mindset. Comment below!