Is Your Money Mindset Killing Your Finances?

Millions of Americans are struggling to pay their bills and meet their financial obligations. 

The last eight years have taken a toll on Americans economically, and many are still feeling the financial repercussions.  According to one study, indebted Americans owe $14,517 on credit cards on average (Forbes).

But how much they owe isn’t the only problem.

The other half of that equation is how much they’re saving. . .or not.

According to TIME, only 1/3 of Americans have at least $1,000 saved in an emergency fund.  Of course, logically, if they’re not saving for the short term, they’re also not saving for the long term.   As CNN Money reports, “About 49% of Americans say they aren’t contributing to any retirement plan, according to a new survey conducted by LIMRA, a trade association for the financial services industry.”

Americans are in bad shape financially.

But what if the secret is not learning how to live more frugally?  What if the secret is instead to look at your money mindset?

If you’re stuck in a financial rut, could one of these reasons be the cause?

4 Crucial Places Your Money Mindset is Killing Your Finances

Is your money mindset killing your finances?

1. You Don’t Consider the Future Enough

Sometimes life is like a game of chess.

You have to not only look at where you are currently, but also anticipate what may lie ahead, depending on what action you take now.  The ability to take action only after you’ve considered all financial implications is a skill many millionaires have.

According to Amanda Augustine, job-search expert at, wealthy people often are “willing to move horizontally, or even take a step down if there is a future opportunity to move up and take on an even better role.  Employees at every level can learn from this behavior.  Making a sideways career change (either within your company or to a new one with a similar title, pay and responsibility) can also be worth it if your industry is contracting and the new job is in a field that’s growing or if you’ll be saving money with a shorter commute or cheaper parking or getting better benefits, whether insurance- or retirement-related” (Huffington Post).

I knew a woman who was unemployed, and she refused to take any job that paid her less than her old position.

However, what she failed to see is that many of these positions she applied for, though they started at a lower salary, had the potential to eventually give her an even greater salary than her old job.  She refused the jobs without looking at the future.  Instead, she remained unemployed and eventually went back to school for a Master’s degree.  She acquired more student loan debt, and the last I had heard, she had earned her Master’s degree and was still unemployed.

Don’t let this be you or your finances could suffer as hers did.

2. You Don’t Create a Persona for Yourself

No, I’m not talking about being someone you’re not.

Instead, I’m talking about creating a reputation for yourself. 

If you want to get ahead at your job, you may think that the secret is to work hard and do an excellent job.  While that is important to do, it’s not enough.  Michael Slade, HR director at Eric Mower and Associates, suggests, “If you want to advance, some of the responsibility falls on you to toot your own horn.  Make sure your supervisor and your supervisor’s supervisor are well aware of what you’re contributing” (Reader’s Digest).

In his ebook, How to Get Your First 5,000 Subscribers, Derek Halpern, of the popular website Social Triggers, urges people to create buzz about themselves by forming the way you’d like people to think of you.  He calls this technique shaping.  If you want to be known as the go to guy to fix computers, for instance, you need to create that persona and shape the way people think about you.

3. You Don’t Want To Negotiate Your Salary

Have you ever negotiated your salary when you’re applying for a job?  Have you ever asked for a raise after you’ve been in a position for some time?

If your answer is no to either of these questions and you currently feel you’re not being paid what you’re worth, you may carry some blame for your low wages.

Did you know that many employers expect you to negotiate your salary when you’re interviewed?  Of course, you don’t want to bring up salary requirements in the first interview, but as you advance through the hiring process, remember to negotiate when it’s clear you’ll get the job.

One human resources professional advises, “If we ask, ‘What salary are you looking for?’ say you’re flexible, or say it depends on the responsibilities of the job.  Try not to name a salary unless we really push you, because that gives us a leg up in the negotiating” (Reader’s Digest).

The fear of negotiating your initial salary is one of the reasons why many men are initially paid more than women who are doing the same job. 

Men are more willing to negotiate their salaries than women.  One study found “that the starting salaries of male MBAs who had recently graduated from Carnegie Mellon were 7.6%, or almost $4,000, higher on average than those of female MBAs from the same program.  That’s because most of the women had simply accepted the employer’s initial salary offer; in fact, only 7% had attempted to negotiate.  But 57% of their male counterparts–or eight times as many men as women–had asked for more” (Harvard Business Review).

Negotiating your salary is an essential skill necessary to earn more money.

Once you have the job, don’t be content to just keep working for the same salary.  The past few years, not getting a raise has been the norm for many simply because of the economic climate.  However, if you’ve been working hard for a year or two, don’t be afraid to ask for a raise.

Plan to frame your request in the language your boss wants to hear.  She probably doesn’t really care that your money is tight and your expenses are high.  What she wants to hear is why you deserve a raise based on the work you do for the company.  Prepare to meet with your boss and have a list of projects that you’ve completed successfully and valuable skills that you bring to the company that others don’t have.

“Broadly speaking, managers tend to think in terms of production, economic value added, and supply and demand when deciding what to pay people (especially in the private sector)” (Psychology Today).

4. You’re Afraid of Change

Fear of change can keep you rooted in a job that is no longer a good fit for your interests and skills, or it can keep you in a lower paying job when a higher paying job with more potential for advancement may be out there.

Fear isn’t only affecting people in the job market.

After the roller coaster ride of the stock market for the last few years, many people are so afraid of losing money again that they refuse to invest.  Instead, they stick with “safe” investments like certificates of deposit that often do not keep up with the cost of inflation.  “‘Getting overly conservative is as risky as anything else that could hit your portfolio,’ said Steve Wood, chief market strategist for Russell Investments.  ‘A riskless portfolio is not what people would want to orient themselves around, because that would be low-return or return-less'” (MSN).

Fear of change is something all of us face, but it doesn’t have to be paralyzing. 

Understanding why we have fear can help us face it and realize that our fear is largely unfounded.  “We humans are fearful creatures.  When faced with making a change, we tend to think about all the ‘what-ifs,’ imagine the worst possible outcomes, treat those thoughts as though they are the ‘truth about how things are,’ and therefore convince ourselves to stay stuck where we are” (The Christian Broadcasting Network).

The worst-case scenario rarely happens.  Knowing that can go a long way to helping us release our fear and move forward.

I must not fear.
Fear is the mind-killer.
Fear is the little-death that brings total obliteration.
I will face my fear.
I will permit it to pass over me and through me.
And when it has gone past I will turn the inner eye to see its path.
Where the fear has gone there will be nothing.
Only I will remain.
Bene Gesserit

Final Word

While the last few years have been difficult ones economically, if you’re struggling financially more than you feel you should be, maybe it’s time to look at your own thoughts and behaviors.  Your mindset just might be a larger part of the problem than you thought.

Do any of these behaviors apply to you?  What thoughts do you have that keep you from accomplishing your financial goals?

Take a look at our episode about Money Mindset over at the Money Mastermind Show

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Published or updated September 12, 2014.


  1. As a professional actor, it’s really easy to get into a short term money mindset. You just think of how much you need to float you until the next job or the end of a contract or whatever. It creates a cycle of unsustainability and burn out. You really need to be able to step back and think longer term if you want to be successful- actor or not.

  2. Richard Mathis says:

    Great article. It’s very important to have the right mindset. It can help in different spheres of life. For example, in finding a job. I saw this first hand. You must have a certain mindset, you have to be confident. But, of course, you also need a great resume (you can always get help and you must be a professional to get the desired job.

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