6 Steps to Creating a Positive Money Mindset

What makes someone successful with money? Although there’s a lot of different factors, a big one is their money mindset. 

Money isn’t something most of us are good at talking about, and can be a sensitive subject. However, there’s no escaping it - everyone on the planet needs money to get by; and not having enough of it can cause major anxiety and stress. 

However, did you know that more often than not the difference between financial struggle and success comes down to more than just numbers? 

What you believe about money, yourself, and the world are all key aspects of your money mindset and shape your financial life. As a result, every single day you have the power to make decisions that move you forward financially.

If you live in constant fear when it comes to money, you may be unintentionally harming your chances of making more of it, or getting out of debt. It’s up to you to change your financial habits and develop a positive money mindset. 

The good news is that by making a few changes in your life, you can make this change happen!

In this article, we’ll explore the different steps to creating a more positive money mindset. The goal is to start to shift your perspective on money and start gaining more control over your financial future. 

1) Forgive Your Past Financial Mistakes

We’ve all made our fair share of questionable financial mistakes. Whether it’s overspending on rent on the “must have apartment” or one-too-many treats at the supermarket, we all spend more on the little and the big things. 

Whatever financial decisions you’ve made in the past have already happened, and you no longer need to beat yourself up over them. Instead, reframe your thinking when it comes to these decisions. 

If you currently have debt, think about the nights you’ve dined out with friends or the trips you’ve gone on. In those moments, your debt brought you joy and allowed you to create memories. While it’s important to recognise debt as a challenge, try to acknowledge the experiences it enabled, and the lessons learned along the way.

Not everyone is born with the ability and knowledge to effectively manage their money. But many learn to develop their financial skills through trial and error. Focus on learning from your mistakes and forgiving yourself for past financial mishaps, even those you’re still paying for.

2) Understand Your Thoughts and Emotions Surrounding Money

While you may understand your thought patterns regarding money and finance, taking a deeper look at them can provide some new and interesting insights.

Here’s an exercise you can try to properly understand your thoughts and emotions surrounding money. For a day, after each purchase or financial decision you make, write down your thoughts and emotions. Be honest. Then, at the end of the day, revisit your notes and go through each of them with an open mind. 

Through this exercise, you may find certain aspects of your finances are bringing more stress than expected. Perhaps an impulsive purchase that brought you joy in the moment, doesn’t anymore. 

This exercise will help you reevaluate how your spending habits are affecting your thoughts, emotions, and mental health. By understanding your financial thought patterns, you can start to build a more positive money mindset to make more informed financial decisions. 

3) Comparing Yourself to Others Is a Losing Game

When it comes to creating positive thoughts about money, comparing yourself to others is one of the worst things you can do. It may come as a surprise, but your comparisons may not even be accurate. 

You know practically everything there is to know about yourself. However, if you're comparing yourself to someone online, a celebrity, or a fictional character, you’re comparing yourself to someone you know almost nothing about. 

Many people’s online presence reflects only parts of their lives, often focusing on the positive aspects, which can make comparisons less meaningful.  Their posts only focus on the highlights of their life and financial successes, while leaving out the other parts.

This is true even if you’re comparing yourself to someone you know, like a friend or family member. You can’t know as much about them as you do yourself, so you won’t be able to fully understand their financial situation.

Another disadvantage of comparing yourself is that it can often lead to feelings of discouragement and inadequacy. Comparing yourself to others will set you back in your journey of building a positive money mindset and can lead to worse financial choices in the future. Spend your time thinking about what to do with your own money, not what others do with theirs.

4) Form Good Money Habits

It’s important to face your fears and financial challenges with confidence, even if they feel overwhelming. Set aside some time each week to review your bills, budget, and spending habits. During this time, highlight areas that you think need work and congratulate yourself for any improvements.

While it may feel easier to avoid financial concerns, addressing them with patience and confidence will help you gain control over your situation. 

Set realistic financial goals and find small ways to reward yourself when you accomplish them. Remember, your finances probably didn’t spiral out of control overnight and similarly, your success will appear gradually as well. It’s important to set goals for yourself and celebrate each milestone forward. 

The key to building a positive money mindset is patience and being kind to yourself.

5) Create a Budget That Brings You Joy

The idea of a budget can make you feel uneasy, as they often seem too restrictive. However, budgeting doesn’t have to be this way. A flexible budget can help you stay within your spending limits and understand your boundaries, while still allowing you to treat yourself occasionally. 

A good rule of thumb is to follow the 50/30/20 rule. According to this principle, you put half of your income towards bills, thirty per cent towards paying off debt or building savings and twenty per cent to use as you please. 

If this pattern isn’t feasible right now, take some time to review your expenses, and explore adjustments that could help ease your budget.  Once you build a budget that you’re satisfied with, you’ll find yourself nurturing a positive money mindset to match.

Choose Salad Money For Fair and Affordable Personal Loans 

Money plays a pivotal role in our everyday lives. However, it’s important to not let it control you or your thoughts. Instead, working towards improving your thoughts around money can help you develop a more positive money mindset and improve your spending habits.

Our tips are aimed to help you get started on your journey with the hope your changed thoughts and emotions around money have a positive impact on your life.

However, at Salad Money, we understand that life isn’t always straightforward. Despite our best efforts to stay on top of our finances, there are times when we find ourselves in need of emergency money.

Fortunately, we’re here to offer the financial support you need, when you need it the most. 

As a leading online lender in the UK, we believe that your credit score isn’t the best way to judge anyone’s ability to repay loans. That’s why we use a safe and secure open banking system to accurately assess your loan affordability. This allows us to provide you with the financial assistance you need, irrespective of your credit score. 

We're authorised and regulated by the Financial Conduct Authority, so you can rest assured your data is safe with us.