Sunday, September 16, 2012

7 Money Mindset Myths That Are Keeping You Poor

by Vincent King 

Budgeting and managing your money is never a happy experience – IF you’re in the red. Yet, if you’re like most people, there are 7 common money mindset myths that are keeping you that way.
Change your mind and change your numbers. This sounds simple, but it works.

Money Mindset Myth #1 – A Penny Saved Is A Penny Earned

Not losing that penny by saving it is helpful, but it takes so much more than not giving that penny to the cashier to create meaningful wealth. In addition to saving, you must also multiply that those cents that you are saving to truly feel the effects. Even if the adage is accurate, it is also incomplete, and certainly not something you can base your future fortune around. Saving pennies is good, but you also need to earn more.

Money Mindset Myth #2 – I Don’t Need Money Help

Paying for people to coach you in precision pilates is a want, but if you have zero experience straightening your finances, then shooting from the hip while going solo will likely only set you right back where you started from.
Investing in a money coach will lead you down a safer road lined with superior choices, better decisions, and ultimately a finish line you’ll likely never reach alone.
Invest in a coach and train for financial success.

Money Mindset Myth #3 – Budgeting Saves Me Money

As noble as that might be, it isn’t accurate. Write everything you earn, subtract everything you spend, and allot a certain amount toward your saving. Then you’re gold, right?
No, not really. You can record your pluses and minuses all day, but if you’re not acting on what you wrote, your budget means nothing.
Carefully plot and plan, then follow through by making improvements to see optimum success.

Money Mindset Myth #4 – If I Earn More, I Can Spend More

You worked 60 hours last week. Dog tired, you came home and collapsed into bed. The exhaustion is fine, at least your paycheck will be fat.
When it’s time to reap the rewards, you happily head out, paycheck in hand to shop.
“Look at all this overtime! I deserve a ‘little’ something for working so hard!”
That’s why you’ll stay right where you are in your finances.
That “little” something extra is called overtime pay, and THAT is your reward. Stick all your “extra” earnings in a special fund or savings account, then leave it there so you can watch it grow, rather than disappear.

Money Mindset Myth #5 – If I Don’t Risk It, I Can’t Lose It

Playing a smart financial game means taking intelligent risks. You will never make a mint if you don’t make smart investments. Fail to take SMART risks with your money, and you will keep the blooms from blossoming on the branches of your money tree.
Stock valuations are volatile, but individual investors can still profit on the expansion of the economy by buying into a broadly diversified index fund that tracks the total market as long as they have a long term vision.
Know a good investment when you see it, and be smart enough to make it.


Money Mindset Myth #6 – I Make Enough

You bring home your check every two weeks. Your house payment is always made on time. And your bills are current. Yet, you have nothing left for savings, and little if any for life’s extras. You might make enough, but you’ll never reach financial independence if you can’t get ahead. You don’t want to be 50 without any retirement assets.
Assets determine your worth, and if you want to grow your financial portfolio, you must find a way to start saving while you invest to increase your assets at the same time.

Money Mindset Myth #7 – My Today Is Taken Care Of

Too many people live in the moment. In today’s economy, it’s difficult to look past now to see the promise of tomorrow. Yet, right now is when it’s essential to plan ahead. What will your reserves be like as you head into retirement? Not putting away what you can now is a near guarantee that you’ll not have enough when you need it in the future.
Start saving into a retirement fund today so you can start planning for future success.
What money mindsets are holding you back?
Jean July 2, 2012 at 10:54 pm
Yea, having a money coach can defintely be a good investment if you’re inexperienced. And very true that too many people live in the moment and don’t think about tomorrow. I can’t even rest in the present unless I know I have some sort of plan for the future.
Sherry Vosburgh July 3, 2012 at 11:37 am
Where does one find a money coach (in Belgium)? I already have a Financial Administrator who manages my pension, gives me a weekly allowance and decides on major expenditure. He gets 3% of my yearly income. He acts as a brake on impulse buys – a topic you could cover – but doesn’t really teach/coach me on money matters. At least I have a house but am paying off bank loans – now interest-free as a kind friend paid the bank off and I pay her monthly. I love spending, and I find the only way to stop is to stay home.
Shane July 3, 2012 at 12:37 pm
Nice tips, financial tips and tricks don’t always work. I try to use the role of 4ths, 1 to rent, one to food and entertainment, one to bills, and one to savings.
Wonga July 5, 2012 at 4:05 am
I’m actually thinking of starting to have a retirement plan next year when I finish all my loan repayment. 25 years before retiring is, I guess, not too late to start.
Thanks for the reminder. Nice tips!
Marbella July 5, 2012 at 7:59 am
Several good advice, but a well balanced budget over a month, half a year ahead and a long term budget over several years together allows you to save money the best way.
Krystyna July 5, 2012 at 8:08 am
Don’t go to stores. If you don’t go, you don’t buy.
Mackenzie July 6, 2012 at 12:02 pm
Overtime pay… the list of exemptions for overtime pay is long, and rules out basically everyone salaried, using a computer, or in seasonal work.
Pascal July 11, 2012 at 12:14 pm
Why have fear of our future? Who knows his future? A good daily plan is for me enough as it has positive impact on the future. Think positive, react positive and everything will simply be better.
Eilleen August 16, 2012 at 7:12 am
I always believed that I would die young like the rest of my family so that’s how I lived. Or I would die in a plane or car crash because I traveled so much. I never saved a penny for retirement because I never believed I’d see such a day. Well people, I’m now 54 and healthy! Now I see my future as one of these little old ladies living on the street pushing a grocery cart! I better move somewhere warm!
Pedronio August 16, 2012 at 3:34 pm
Always live expending the half you earn.
Rick August 19, 2012 at 4:51 pm
Actually, a penny saved is more like (est.) 1.4 pennies earned, since you have to earn 1.4 pennies then have an after tax income of 1 penny to spend a penny.
Britany August 21, 2012 at 5:24 pm
For me, this is the best solution “change your mind and change your numbers”. In this way, we can live a life we want.
Sally August 24, 2012 at 5:10 pm
We scrimped, saved, went without holidays to pay Insurances, Endowment Mortgages, we had kept updated so we would not be caught in the not enough to pay mortgages, also a second Endowment to pay our daughters uni bills and buy starter flat, my husband lost his IT contracting business during the last recession. With the recession and paying our Endowments we had to use savings, which was for a while keeping us afloat and paying off Inland revenue debts and mortgage payments we lost all our Endowments. But we could not continue paying them, when our savings ran out.
We also paid income Insurance to be told when he became unemployed that he was not eligible for payout as he was a Consultant, working for his own Ltd Company. We were not told that when we were sold it.
Whatever we did to be self sufficient and have a few holidays when we had some time and money after retirement it has been stolen off us.
So we are unable to have holidays or days out, or even recarpet rooms that have carpets that are twenty years old!
So enjoy life while you have the wherewithal to do so as you will find it impossible to stay one step ahead of the Institues and Government who will bring in a new way of getting their hands on it.
We also paid into a small pension all his working life to find that we are now not eligable for government help or respite care without we pay with all our joint pension. So a very bitter couple say go on those holidays and treat yourself as we have been ripped off all along the way.
lost all our Endowment
Policies which we had kept updated so we would not be caught in the not enough to pay mortgage
julianne August 25, 2012 at 2:11 pm
to Sally “…who will bring in a new way of getting their hands on it.” –
it’s true. but theres no way to control the situation; even if we are very committed to fairness …fairness seldom happen. just hope the honest (those who work, every day, like myself) can have food and shelter to the day i die..
robbers in the past used to come with masked veils, creep around and takes action deep into the night. once reported, gets harsh and stern treatment from law enforcers.
these days robbers wear suits, puts on a tie, comes with ‘legal backing’ and walks through your house, clean you of every penny. ruling parties bow to them, open their doors, and deem them as nonoffenders.
There is no safe place in the world. everyone honest is doomed to suffering. there is no place to rest. i dont think i’ll ever have children. why bring them to term? these times are cursed. they will only suffer.
no one,
NO one
is fair.
Paulo August 31, 2012 at 10:08 pm
Move to Scandinavia. You will be taxed 60% of your income but you will never be “one of these little old ladies living on the street pushing a grocery cart”.
Thomas Prahl September 13, 2012 at 11:24 am
Not 60%. Only 40% but then all helth-insurance costs are included.
Free Hospitals. Free education. If you get unemployed you can get up till 2 years unemploymentsupport. (approx 1800 USD after tax a month)
I sometimes smile at you americans calling europeans communist. We are not, but we build up a society where the stronger ones help the weaker ones. Even the rich people in europe support this way of organizing a society
Thomas Prahl
Webdude September 11, 2012 at 8:05 am
Most people want to be fair, or at least consider themselves to be fair. The trouble is, most people are egotists, thus have difficulty seeing what is fair, or don’t care.
Sounds like you haven’t learned the #1 Money Rule: You Don’t Get What You Deserve – You Get What You Negotiate. Unfortunately, negotiation is not taught in grade schools, nor in most colleges. Scions of the old rich may have learned it through formal training, or from their parents. Nouveau riche learn negotiation from the Hard Knocks School of Life. Even if you are a naturally savvy negotiator, there are still fine points to learn.
Most of us, who aren’t driven by greed and the desire to screw other people as much as possible, will never get rich unless we manage to invest well, or at least learn some rudimentary negotiation skills. Think about your biggest purchases. For most people, those are homes and vehicles. Chances are you were an amateur up against professional sales people. How did you do? How many thousands, tens or hundreds of thousands of dollars does your instinct tell you were lost due to being hustled by the sales pros?
Lord Koos August 29, 2012 at 9:28 am
“…individual investors can still profit on the expansion of the economy”
Buy gold or forget it…

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