How many people do you know who have it all – a great career, a wonderful family, money, the dream house – and yet they don’t seem happy?
Sometimes we get so caught up in the fear of losing something or that we don’t have enough of something that the fear consumes us and prevents us from enjoying what we do have. That’s what’s called a scarcity mindset.
Our feelings don’t always reflect the reality of our situation, but they often shape our reality. Our thoughts are incredibly powerful. That’s why we need to be careful about our mindset in every area of our lives.
Today, I want to talk about having a scarcity mindset vs abundance mindset, particularly when it comes to money – what a scarcity mindset looks like, why it’s dangerous, and how you can go from a scarcity mindset to an abundance mindset, which will help you build wealth, success, and happiness.
What it means to have a scarcity mindset in finances
A scarcity mindset means that you’re so obsessed with the lack of something that you can’t appreciate how much you have.
A scarcity mindset doesn’t mean that you’re struggling financially; in fact, people who are extremely well off still have a scarcity mindset. Someone once asked John D. Rockefeller – one of the richest men in American history, whose fortune far outshone Bill Gates and Warren Buffet – how much was enough, and he answered, “Just a little bit more.”
People who have a scarcity mindset often find themselves saying things like…
- I never get what I want.
- I don’t have enough money.
- I can’t do it. (“It” may be paying off debt, investing, buying a house, etc.)
If you’re living with a scarcity mindset around money, it’s important to take steps to correct it so you can start living with abundance.
Why does a scarcity mindset hurt you?
There are several ways that a scarcity mindset negatively affects you. A scarcity mindset...
- takes a severe toll on your mental health
- limits your brain function. It limits your ability to solve problems, hold information, and reason logically
- affects your decision-making ability
- makes impulse control harder
So, what’s the opposite of a scarcity mindset? An abundance mindset.
What is an abundance mindset?
Living in abundance means recognizing the endless potential in yourself and others. It frees you up from fear and self-imposed constraints. When you expand your perspective and develop an abundance mindset, you open your life up to infinite opportunities.
Someone with an abundance mindset:
- thinks big
- leans in on personal development and growth
- faces life with optimism
- embraces a spirit of generosity
People with an abundance mindset believe in self-improvement, which makes them much more likely to succeed in their personal, professional, and financial life - especially compared to people with a scarcity mindset. A scarcity mindset causes you to believe that nothing can be done to change the situation, so why try?
If you want your journey to financial wellness to be successful, the first thing you have to do is get your mindset right.
Now that we've discussed the basics of a scarcity mindset vs abundance mindset, here's how to go from scarcity to abundance:
How to develop an abundance mindset
1. Focus on what you have (not what you don’t)
When you’re intensely focused on something, you block out everything else. Think about when you’re so focused on scrolling through TikTok that you literally can’t do anything else except keep scrolling. (Just me?)
What you focus on dictates how you feel. Have you ever seen the movie It’s a Wonderful Life? Remember the part where George Bailey is standing on a bridge, thinking about jumping, and then Clarence the angel swoops in and shows him everything good in his life? George was so caught up in his current troubles that he forgot to look around and see how great his life really was…and how much better he made everyone else’s life. We do the same thing when we focus on what’s going wrong.
So when you find yourself daydreaming about all the things you DON’T have, take some time to focus on the things you DO have – good health, good friends, a good job, good weather…whatever good may be happening for you right here and now.
One easy way to start noticing what you have is by keeping a gratitude journal. Every morning, write down three to five things you’re grateful for or you’re looking forward to.
If that’s too much, you can adopt the toothbrushing gratitude practice. While you’re brushing your teeth, bring to mind three things you’re grateful for.
2. Surround yourself with positive people
Whether you realize it or not, the people in your life have a HUGE impact on your mindset and future.
Have you heard the adage that you are the average of the five people you spend the most time with? It’s true.
We pick up the beliefs, mindsets, and attitudes of the people we surround ourselves with. So when we hang out with pessimistic, Negative Nellies, it rubs off on us. In that context, we can easily lose the confidence and drive we need to meet our goals.
With that in mind, choose to surround yourself with positive people who believe in you, will cheer you on to your goals, celebrate your successes, and offer encouragement when things inevitably don’t progress as smoothly or as quickly as you’d life.
And if your best friends are holding you back, maybe it’s time for a frank conversation. You could say something like, “Hey, I’ve decided that this is going to be my financial turning point, and I’m going to need some support on this journey. Can I count on you to help me stay focused on my goals and believe that they’re possible?”
3. Rewire problems into opportunities
The other day I was headed on a weekend getaway with some friends and we had WAY too much stuff to fit in the trunk. Instead of seeing it as a problem, I saw it as an opportunity - to practice my excellent packing skills. I pulled everything out, rearranged, and it fit. It was tight, but it fit.
One of the challenges of having a scarcity mindset is getting stuck on the problems. It’s easy to get bogged down in a victim mentality with this mindset instead of looking for solutions.
So, when the next challenge arises, try to rewire your brain to look for the opportunity in it instead of focusing on the obstacles.
4. Make time for things that boost your mood
We talk about the importance of self-care a LOT around here. And if a manicure or spa day or reading a good book will help you relax, de-stress, or feel better about yourself, go for it! Do whatever will help you break out of your negative mindset so you can start approaching your finances with positivity.
But I want to mention two things that we often overlook and are proven to release feel-good hormones and help you stay mentally and emotionally grounded.
- Exercise. Our bodies weren’t made to just sit and stare at a computer or scroll on our phones or lay on the couch binging Netflix. We were made to move.
Exercise has a huge impact on your mindset. It decreases depression and anxiety and releases endorphins. It energizes you, builds up your immune system, and it can even help your brain function and memory.
I’m not saying that you need to join a CrossFit gym, but make an effort to leave space for joyful movement every day. Go for a walk. Rollerskate. Personally, I like to start my morning with kundalini yoga on the Glo app, and I LOVE it! Do whatever feels good for you.
- Make time for the people who mean the most to you. Sometimes we forget to include other people in our self-care routine. But loved ones remind you that there are more important things in life than money…or work…or anything else that we tend to get overly focused on.
These are the people who have always been there for you and helped you become the person you are today, and spending time with them helps you stay grounded. Don’t forget to reach out once in a while and reconnect.
5. Commit to a weekly money ritual
Scarcity mindset comes from your emotions…and emotions aren’t always reliable. What you need to focus on instead are the facts.
Every week, commit to spending at least an hour reviewing your finances. You can review your bank statements, look at how much money is entering and leaving your account every week, check your credit card account, things like that.
Staying grounded in the reality of your financial situation will help prevent you from building up a narrative in your head that you need to save save save or make more and more and more. It’ll empower you to make the best, fact-based financial decisions.
The good news is that managing your money doesn’t have to be painful. You can create a pleasant environment by lighting candles or listening to music and reward yourself after with chocolate or your favorite show.
Scarcity mindset vs abundance mindset
The first step to achieving financial success is having the right mindset. You can’t make positive changes in your financial situation until you start transforming your negative thoughts and relationship with money. Your mindset is like the steering wheel for your finances; until it’s pointed in the right direction, you’re just going to be wasting a lot of time.
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