6 Limiting Beliefs about Money Keeping You Poor
Limiting beliefs are those thoughts and attitudes that hold us back from achieving our full potential. In terms of money, limiting beliefs can be the negative thoughts, feelings, and perceptions that hinder our ability to achieve financial success.
Here are six common limiting beliefs about money that you need to shed in order to find monetary success.
1. The pursuit of money is selfish
I think this belief stems from another limiting belief of “Money is evil.”
The argument is that the capitalistic economy we live in today encourages people to step over others and exploit those who are vulnerable in order to make money.
Although there are many people and companies who do this, there are also a lot of ways to make money morally while making a positive impact on the world (building new software, creating educational curriculums, etc).
In addition, having money will give you the ability to make even more of a positive impact on the world compared to if you don’t have any money.
For example, if I wanted to increase access to education, having money could allow me to buy and donate educational materials or even build a school in a low-income neighborhood
On the contrary, my options to make an impact without money would most likely be limited to teaching a class at a school or volunteering. Of course, making an impact without money is also possible, but it would be much easier to use the money to make any type of significant change.
Systemic changes especially will most likely require money and resources.
More money = more impact
2. Money can’t buy happiness
You usually hear this statement from a rich person who already doesn’t have all the issues that the poor have to deal with.
I do agree with the statement that money can’t buy happiness directly, but having money can:
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- Buy you experiences
- Buy you freedom
- Save you from pain
Money buys you happiness up to $500,000.
Having a baseline amount of money will allow you to not have to worry about money all the time and actually focus your energy on things that you care about. This could be making new experiences, spending more time with loved ones, or making a difference in the world
For me, a lot of my favorite memories and experiences were only possible because I have saved up enough money for me to spend on those experiences.
I also am very aware that growing up I was sheltered from a lot of pain because my parents had enough money to provide food and housing for me. I was able to focus on learning at school because I didn’t have to think about where my next meal was coming from.
The main reason I myself want to make more money and reach financial independence is that I want the freedom to not have to be shackled to my corporate job.
I don’t want to live in fear of being fired.
I want to have the freedom to work when I want and where I want.
And I want to work on the things that I feel like actually will fulfill me and make a difference in the world.
To me, money equals freedom, security, and safety.
3. You have to work hard to make money
Hard work and earning potential are definitely positively correlated. You need to have a certain level of grit in yourself to make a lot of money, but you won’t become rich with hard work alone.
So how do you make a lot of money?
You are compensated according to the level of difficulty of the problem you solve, here’s why.
The price of a good or service is determined by the supply and demand of the product (see graph below).
Not a lot of people are able to solve highly difficult problems. If you are able to solve a difficult problem for people, your graph will look more like this:
Notice how the price is higher compared to that of the previous graph.
Someone working at Taco Bell won’t be compensated a lot because they are easily replaceable and there is a high supply of people who can do the job. On the other hand, surgeons solve a highly difficult issue and there aren’t a lot of surgeons, so they get paid a lot for their service.
In order to have the chance at making a lot of money, you should focus on obtaining valuable high-demand skills. The skills that are considered valuable and in high demand (and low supply) also depend on the country and region you live in.
Obtaining valuable and high-paying skills takes hard work, but once you have the correct skillset, you do not need to necessarily work hard to solve difficult issues and make a lot of money.
Our society today has normalized working hard, and people often brag about working hard. But I believe it is important to know how to work smart as well.
4. “Money Doesn’t Grow On Trees”
This phrase comes from a scarcity mindset point of view. I myself am guilty of subscribing to this belief as well, even now. It is a saying that was ingrained in me due to my immigrant family background, and it’s something that I’m trying really hard to overcome in my system.
The scarcity mindset for money prevents you from taking risks.
Oftentimes some of the highest-return investments have the highest risk. In addition, having an abundance mindset will allow you to be constantly on the lookout for new ways of making money.
The scarcity mindset was what caused me to end up in an accounting role as my first job out of college.
My parents told me that accounting is a really stable job, so why should I pass up on this offer and risk not finding a job after college again?
Although accounting was a stable route and a sure way for me to have a steady paycheck, I did not enjoy the job at all. Working under someone also means that my earning potential is capped. I traded my freedom for job security, and this is something I’m working actively to change.
5. I’m not good with money
Money management is a skill that you have to practice. It takes time & consistency to get good at it.
Like any skill, you’ll make mistakes and you’ll learn from the mistakes and get better.
You can decrease the likelihood of making those mistakes by reading books and studying them on a daily basis.
Instead of thinking “I’m not good with money“ you should be thinking “I’m not experienced with money yet, but I will get there the more I practice, money management.“
6. I don’t deserve to be wealthy
This is one of the most self-sabotaging money beliefs that you can have.
It is a belief that is developed and operates at an unconscious level.
This limiting belief can manifest itself in a couple of ways, here are some examples:
- When you are about to get a promotion, you decide that you’re not ready for the management role. You decline to be promoted or you switch jobs to a lower paying role where you feel more comfortable. Unconsciously, it is because you are afraid of becoming success because the more you have, the more you can lose.
- The moment you earn a lot of money, you are stressed out by the fact that you have a lot of money. So you spent it all and living paycheck to paycheck. You drown yourself in materialistic purchases, but you are deeply unhappy because of the debt you carry.
These beliefs stem from a lack of confidence and self-worth, which traps you in a vicious cycle.
Maybe you grew up in a poor family and didn’t ever think you could become wealthy. Maybe you were told that you have no talent and you’ll never make it in the world.
The only way out, is to acknowledge the issue and break these negative beliefs.
Breaking Your Limiting Beliefs
Most of us have adopted some type of negative money mindset in our lives. And usually, it is not our fault that we adopted those negative mindsets.
But no matter what our origin story is, we are the only ones who will be able to break ourselves out of those bad mindsets.
It is our responsibility to reflect on ourselves and fix those problematic beliefs. Only we have the ability to fix our belief systems and set ourselves up for success.
Instead of having a victim mentality and feeling sorry for ourselves, we need to look at our issues objectively and figure out ways to solve them.
So… “What’s Next?”
Breaking your limiting beliefs may take a while, but once you’ve done that, you’ll find that all your financial goals are within your reach.
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