4 Money Mindset Shifts that Transform Your Finances

4 Mindset Shifts that Transform Your Finances

Emily Malecha | Jan 4, 2023

“Whether you think you can or you think you can’t, you’re right.”

– Henry Ford, industrialist founder of the Ford Motor Company

We know what you may be thinking: “These people are financial experts, but now they’re saying I can think my way to wealth? Yeah, right.”

We promise this isn’t an article about meditation, mantras, or manifesting (alliteration, anyone?).

We know financial success requires grit and discipline. Our long-term clients who feel financially independent often spent years, decades even, making smart choices and learning from mistakes.

The path to financial freedom requires action, not just thinking about your wealth goals.

BUT. (You knew that was coming.)

How you think does affect your reality.

It is scientifically proven that mindset plays a significant role in determining life’s outcomes. By understanding, adapting, and shifting your mindset, you can become more resilient to life’s challenges and more successful in pursuit of your goals.¹

Actions flow out of belief. Therefore, if you want to change how you behave around money, you need to change how you think about wealth and how to build it.

We recommend starting with these four shifts:

1. Take ownership of your financial life

We all have factors outside of our control that affect our financial wellness, for better or worse. For example, a large inheritance or family tragedy can have an enormous impact on your financial situation.

Still, the first step to building wealth is to identify what is in your control and own it.

How you spend, save, and protect your assets all fall into the category of what you can manage. Taking control of these factors will help you manage situations beyond your control.

2. Educate yourself by leveraging trusted experts

The main reason people make financial mistakes is because they are misinformed or unaware of their options.

Insurance and investments can be complex, but they aren’t unknowable. Once you understand the jargon, you will begin to comprehend the concepts behind a solid financial strategy. Working with trusted experts who are committed to your success can accelerate this process.

3. Start with a plan, fill in with products

When we are learning something for the first time, we get excited about each piece of new information we gathered and want to run full steam ahead.

For example—a client may have heard an ad on the radio, and from that determined that they now need a $300,000 life insurance policy.

However, the client may not have taken into consideration their overall financial picture. Before making any recommendations, we would want to know more about the particulars of their situation. This allows us to better determine the appropriate product or solution for the client.

Consider the situation above—if the clients are young parents who have a goal of funding their kids’ college, paying off a mortgage, and allowing their spouse to maintain their current lifestyle, they’ll very likely need a death benefit larger than $300,000. On the flip side, if they are nearly retired empty-nesters with significant investments and a house they own outright, a new life policy may be redundant.

We start with the plan—the big goals and current situation—and then put products in place to support that.

4. Focus on your goals rather than the markets

There is no such thing as a “normal” market for investing. The only thing you can logically predict in investing is that the markets will rise and fall (…and rise, and fall).

When you focus only on what the headlines tell you about finance, you will be in for a wild ride. Instead, focus on your goals and maintain discipline despite the “noise.”

If your goal is to retire comfortably in 30 years, what’s happening today in the S&P 500 has little effect—you have plenty of time for your investments to recover. However, if you are looking to purchase a home in the next month, you’ll want a little more security on those dollars.

Each goal has a timeline and a corresponding risk allowance. Using this information allows us to recommend an appropriate investment strategy. Having this strategy in place is vital to keep you from getting caught up in the fear (or thrill) of what the markets do in the short term, and allows you to invest confidently in the accounts that match each goal.

Recap

Changing your mindset doesn’t happen overnight. However, small changes in how you approach financial wellness can have a huge impact on future outcomes.

Remember, you don’t need to do that alone.

At Confidere, we are committed to your success. We work with you to discover your big picture and your quantitative goals, assess your current financial situation, strategize a path to achieve your goals, implement steps on that path, and review your strategy and results as life changes.

If you are ready to take ownership of your financial life and bring financial experts into the fold, schedule your complimentary, no-obligation first meeting to learn more about how we can help.

Ready to get clear on your path toward financial security? We’re here to help.

CONFIDERE FINANCIAL
North Star Professional Center
2701 University Ave SE
Minneapolis, MN 55414

hello@confiderefinancial.com

612-617-6118