If you change the way you think about money, you can change the way your money works for you

Money is problematic for most of us. We don’t make enough of it, can’t seem to keep it, don’t know where we spend it, or spend it in the wrong places.

Financial education can help, but it isn’t a silver bullet. Because let’s face it: we all know that buying on credit is bad, that budgeting is good, and that we don’t actually need those new shoes. (But look at them!)

While there is no shortage of information, the average South African still spends close to 10% of their monthly disposable income servicing debt, and the estimated 10 million South Africans in bad debt spend up to 63% on repayments.

We have a national debt problem and it seems that simply providing more information is not the answer. 

So, what is? According to money coach Marnita Oppermann it’s our ‘money mindset’ that matters.

A money mindset is the group of thoughts and beliefs that shape what we think, feel and do around money, says Opperman.

“It starts with a healthy relationship. All the techniques in the world won’t help you if your thoughts and beliefs about money are not creating a strong foundation from which to start taking action.”

Financial wellbeing is the result of having a healthy relationship with money and having sound money habits so you can manage your money well.

The first step is awareness, and identifying the limiting and negative thoughts and beliefs each of us have about money. 

Thoughts like “I never have enough” or “money is the root of all evil” get in the way of making good choices.

By changing our language and how we think about money, we can start to change how we act around it.

“One simple example,” says Oppermann, “is how we talk about affordability. Instead of saying ‘I can’t afford it’, rather say ‘my money has other priorities right now.’

This reminds you that you do have the money, you are simply choosing to spend it differently. The ‘right now’ suggests that it will be possible to have the thing you want in the future.”

This language moves the speaker from being a victim of scarcity to being an empowered person who can make constructive choices about how, where and when to spend their money. 

Oppermann suggests some simple steps to become aware of our limiting thoughts and beliefs and developing a positive money mindset. 

Step 1: Understand your current state

Write out everything you think about money. “We need to get clear on our thinking so that we can change the beliefs that don’t work for us,” says Oppermann. “Once you have written them down, reflect on them and what impact they are having on your finances and behaviours.

Can you identify what may have caused this particular mindset? It is based on truth, or can you start to think differently? Ask yourself, ‘how would it help me to improve these things?’”

Step 2: Imagine the desired state

Start with two or three beliefs and write an opposite or desired belief. For example, take the belief ‘I am not good with money’ and write out the alternative, ‘I manage my money with confidence.’ 

The next step is to write down what actions you can take to make this a reality. Reflection without action won’t change anything.

What small action you can take to move your financial life forward?

“It can be as simple as writing down your expenses to get clarity on your spending, starting to develop a working budget, or reading an easy book about money,” says Oppermann.

Step 3: Take the action

Don’t just write down the steps, do the action.

“We start by believing that it can and should be different, and then we take daily action to bring us closer to a better sense of financial wellbeing,” says Oppermann.

Step 4: Remember to be grateful

By acknowledging and recognising the good in our lives and the good that money brings, we can feel more fulfilled. This doesn’t just make us happier, it helps us be more patient and conscious of our spending.

A study published in 2014 proved that gratefulness reduced the need for instant gratification.

“Gratefulness is good for your finances,” says Oppermann. 

Finally, remember to be patient. A change in money mindset won’t happen overnight, but it’s worth the effort and discomfort of uncovering your unconscious thoughts and changing them.

“The combination of new thinking and new action is powerful,“ says Opperman. ”There is no reason any of us need to be held back by how we think about money.”