How your Mindset can Lead you to Financial Independence

05. October 2016

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You’ll have to excuse my hypocrisy. Just days ago I harped on practices that should be adopted if you’re serious about getting rich, yet today I’m going to tell you that those practices mean next to nothing if you don’t have the proper outlook on spending. In the pursuit of financial independence, your mindset means everything. Specifically, if your mindset is not founded on the concept that living significantly below your means is the only route to financial independence, you’re a lost cause. The practices I highlighted in the article only become valuable once you’ve established the mental foundation of financial well-being.

To be blunt, spending should hurt a little. Or a lot depending on the type of shit you’re buying. Even if you’re buying something with sufficient intentionality, letting go of your freedom soldiers (read: money) should still be a little painful. Any time you exchange your future freedom for present pleasures – whether those pleasures are in the form of food, entertainment, housing, or puppies – you should experience a certain degree of discomfort. This discomfort is good. It means you’re acknowledging the fact that you ended your money’s life before it was able to grow into its full potential. You monster.

I hope you find this concept of “mindset over action” to be encouraging and empowering. It’s encouraging because changing one’s mindset is not derivative of time or merit. That is, you don’t need X number of years of mental molding to truly understand this idea nor do you need to accomplish Y or Z to prove that you’re worthy of such a concept. It’s empowering because it allows you to make mistakes. Did you splurge and buy twelve $8 beers last night? And maybe $40 worth of tacos? Big deal. Acknowledge that this probably wasn’t in your best interest. Let the pain/discomfort soak in for a few minutes, and then move on. If you have the proper mindset, such mistakes are drops in the ocean.

It’s my advocacy of this mindset that makes me anti-budgeting. Budgets are predictive and inflexible while expenses ought to be fluid and dynamic. Instead of keeping a budget, I would suggest simply adopting the idea that we should only exchange our money for things that bring greater value into our lives. Because we can’t predict what will bring us value in future months, trying to develop a budget is often a fool’s errand. I should mention that I do recommend a budget to those silly people that spend more than 75% of their income. If this is you, for the love of God write a budget.

Like anything, there are levels of progression in route to financial independence. If you want your journey to be sustainable, focus first on developing the proper mindset towards spending. Once this mindset is established, you can start applying specific actions to accelerate your financial growth. Be patient. But not too patient. Getting rich isn’t going to happen overnight. But it also shouldn’t take 40 years. 🙂

 

 


2 thoughts on “How your Mindset can Lead you to Financial Independence”

  • 1
    Financial Panther on October 6, 2016 Reply

    I’m also a bit of an anti-budgeter. You’re exactly right, expenses are fluid and dynamic. We can have an idea, but it’s hard to know exactly what each month will bring.

    I think a lot of us in the FI community do exactly like you say, we try to exchange our money for things that we truly value, not for things that we think we value.

    • 2
      Markie on November 9, 2016 Reply

      Absolutely! Like I mentioned, budgets are a great place to begin for those just getting started in their FI journey, but for the rest of us, budgets seem a bit cookie-cutter.

      Thanks for the comment, Panther!

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