How to Change Your Money Mindset and Achieve Financial Freedom

How to: Change Your Money Mindset

How to: Change Your Money Mindset

Do you worry about money constantly or feel like you are always just getting by financially? You aren’t alone! You may have grown accustomed to having a negative money mindset over time. The truth is, it’s possible for you to improve your finances, but the first step is to adopt a more positive outlook on your financial life.

Specifically, money management for women is increasingly becoming an important topic as gender norms have changed over the last few decades. According to American Progress, an independent nonpartisan policy institution, the percentage of mothers who are the breadwinners in their households was 41 percent in 2017. That’s more than double the number from 1967, when 15.9 percent of mothers were the breadwinners, according to the same study.A

Here are five steps to changing your money mindset so you can achieve your financial goals. 


Want a template for setting financial goals? Grab your Goal Setting Worksheet download and get started!


    • Leave Your Past Behind

Author and Coach Jen Sincero once said: “You can have excuses or you can have success; you can’t have both.”

Your belief system is shaped by what has happened in the past. Many people avoid things that have once caused them to have a negative experience. For example, let’s say that you started a business that ended up failing. You found yourself in debt, and it took several years after your business failed to get your head above water. If you continue to let that fear of failure influence your life you may never start a business again. 

That’s not the mindset that successful entrepreneurs like Vera Wang, Oprah Winfrey, or Arianna Huffington had when they failed - more often than once. Their past didn’t overshadow who they were or their futures, and it doesn’t need to overshadow yours, either.


    • Shift Your Focus to Abundance

Ashley Feinsten, author of The 30-Day Money Cleanse, has said: “A scarcity mindset is our default when it comes to money.”

Leaving your financial past behind also means that you must drop the scarcity mindset that’s telling you that you’ll never earn enough to get by or do the things you enjoy. When you perceive the world through a mindset of scarcity, you’re never satisfied with what you have, and always feel that you’re not doing enough. Your perspective on life may be ‘I don’t have enough, and I can’t get out of the hole.’ An abundance mindset, on the other hand, is a perspective on life that suggests, ‘I have what I need, and I am capable of changing my situation.’

It takes time and effort to shift your money mindset from a place of scarcity to abundance. However, you can start by practicing affirmations. Here are a few to try, or consider creating your own based on your situation:

  • Money is useful, but it does not rule my life.
  • My work allows me to contribute to society and earn money for my family.
  • When I add value through my work, I create the opportunity for money.

Ready to address your negative thoughts about money and transform your mindset? Try this activity. Start by making a list of fact-based statements about your current financial situation. Then, jot down the thought that comes to mind about that statement. Here’s an example:

Fact Thought
I earn $40,000 per year. I need to make more money to be successful.
I have $20,000 in student loan debt. I am broke, and I’ll never get out of debt.
I have a job. I need a job that pays more money.

If you find that your thoughts are negative, avoid pressuring yourself to change right away. At first, it’s best to simply become aware of the thoughts that you associate with your current financial situation. From there, you can begin to practice an abundance mindset by shifting your thoughts on the same facts. Here’s another example:

Fact Thought
I make $50,00 per year. I have enough to pay my rent and to satisfy my immediate needs.
I have $20,000 in student loan debt. I have an education that will help me get further ahead in my life.
I have a job. I have the opportunity to generate income, and I have all that I need.


    • Embrace Your Responsibility

There are some situations that are out of your control. However, your response to your situation is your responsibility. When you adopt a new money mindset, you’ll be able to change how you respond to tough situations not only in your financial life, but in others as well. Instead of panicking, you can take in what this moment means and look for ways to resolve it, knowing that your current situation doesn’t control your future.


    • Set S.M.A.R.T. Goals

Decide what goals you want to have for your money. Get specific and make a plan for how you’ll take action. If you want help with this step, be sure to check out our blog post “How to Set and Reach Your Financial Goals”. This helpful post walks you through the goal-setting process and includes a free downloadable worksheet you can print out to keep with you.


    • Take Action

With your big goals set, it’s time to take action. Remember, you have the power to change your story! A simple budget could be a great place to start. Creating and maintaining a household budget is one of the tools that will help you regain control of your money by showing you exactly how much money goes in and out of your hands each month.

As consumer and business debt-related attorney and advisor Leslie Tayne has said: “Budgeting has only one rule: Do not go over budget.”

Don’t be afraid to ask for financial advice from a friend or family member who has been successful in achieving financial goals. They may be happy to help and can offer ideas that you might not have considered.

Your confidence in your new outlook will build over time as you progress toward achieving your big goals. Your attitude can become a self-fulling prophecy, so embracing a positive money mindset can have powerful effects on your life.

Do you want more tips about money or want to share your story? Connect with us on Facebook and Instagram to join others in the conversation today! For more financial tips, check out the School of ACE blog.