(Please note, this page may contain affiliate links and we may earn fees from qualifying purchases at no additional cost to you. These earnings help us offset the cost of running this site. Read our Disclosure and Disclaimer for further info.)
As you navigate day-to-day life, you face plenty of challenges. Dealing with issues at work, at home, or with personal situations can be a real struggle.
Another thing you might find difficult is accepting responsibility for your happiness and success. While you do plenty of things right, you may not realize you’re setting up barriers to achievement. And it can be tough living life within those restraints.
Likely, that’s never more apparent than when you think about your finances.
Your Mindset Affects How You Live Your Life
Are you one of the many people who look for someone or something to blame because you don’t have enough of whatever it is that you want or need?
Are you quick to say you don’t have enough money, financial security, or the right house or car?
If that’s the case, accepting that you can control your decisions and attitude can make a big difference.
Your mindset can affect things like how you learn, manage stress, and handle risk. It impacts your social, emotional, physical, and financial health.
If others attempt to put “roadblocks” in your way, take action and figure out how to get past those hurdles. If you allow them to confine you, it will be challenging to get ahead and build a financially secure future.
While taking control sounds easy enough to do, it’s harder for some than others. And that’s where scarcity and abundance mindsets come into play.
These mindsets can play a significant role in how you make decisions, how you spend, save, and invest your money, and how you go about living each day.
Let’s take a closer look at the principle of scarcity and abundance. If you have a scarcity mindset, you’ll see why adopting an abundance mindset could change important parts of your life.
The Scarcity Mindset
When you have a scarcity mindset (or scarcity mentality) you believe you don’t have enough – you’ll never have enough – and that there’s not much you can do about it.
It’s a fixed mindset where thinking “out of the box” and risk-taking isn’t possible. Fear and low self-esteem hold people back from trying new things and advocating for themselves.
A “nothing good will come from it” attitude prevents those with a scarcity mindset from negotiating their rent or for a raise.
It stops them from applying for jobs with more responsibility and higher pay. It can also leave them very unfulfilled.
With a scarcity mentality, you only focus on the present. Immediate and urgent needs are addressed at the expense of your future self.
If you’re not living paycheck to paycheck, you save extra money rather than investing it for long-term growth.
With the scarcity mindset, there isn’t enough money to do both – even if you’re told to start small. There’s always something to spend the money on instead.
Stephen Covey’s best-selling book, The 7 Habits of Highly Effective People, describes the scarcity mentality as a zero-sum paradigm of life – when one wins, someone else loses.
The “pie” is only so big. If you’re lucky enough to get a piece, you keep it for yourself because it could be gone tomorrow.
People with this mindset tend to live sad and frantic lives. They incur debt to avoid missing out on something they want or need today.
They’re takers, not givers, and they seldom if ever get the financial security they desire. They’re jealous of others and what they have, ignoring any of their good fortunes. This can be a very discouraging way to live.
The Abundance Mindset
Covey also coined the term abundance mindset (or abundance mentality).
In this paradigm, “there is plenty out there and enough to spare for everybody.” Compared to a scarcity mentality, it’s certainly a more positive and optimistic outlook.
Those who’ve adopted abundance mentalities aren’t controlled by impulse, and they readily share with others. They always have enough for today and tomorrow.
If there is something they need or want, they’ll figure out a way to get it. But they aren’t in constant pursuit of things. Abundance creates freedom.
With an abundance mindset, you dream and think big. You’re a lifelong learner who always takes opportunities to add to your knowledge and skill set. But it isn’t just about you. When those around you find success, your congratulations are sincere.
As hard as change can be, with an abundance mindset, it’s much easier to embrace change – even complicated changes.
You know life is dynamic, and being future-oriented allows for more growth with an abundance mindset. Your “cup half full” attitude means there’s room for different experiences in life – not just more of the same.
Having an abundance mindset will help you assume some risk to build wealth, start the business of your dreams, apply for a leadership position, or return to school for the degree you still want – all while serving others.
People who think abundantly have real financial security because they make things happen and go after what they want. And you’ll enjoy being around them because of their positivity.
Adopting An Abundance Mindset
After learning more about the abundance mentality, you can see why it’s so important to adopt. If you believe you don’t currently have one, you aren’t optimizing the quality of your financial life.
Having a scarcity mentality can prevent you from taking control of your finances.
The best shot you’ll have at obtaining the wealth and financial security you desire is to do what you can to shift from having a scarcity to an abundance mindset.
What can you do to make the shift?
Below we describe ways to help you realign your thinking. Just keep in mind it takes time, focus, and energy to overcome a deep-seated scarcity mentality.
After taking steps, finding success, and moving toward financial independence, you’ll see why it’s worth all of your effort.
Work to adopt an abundance mindset by:
1. Reducing your exposure to media.
The more time you spend in front of a screen, the worse you probably feel. Scrolling through your social feeds reminds you of what you don’t have. Advertisers get you to spend money on things you don’t need or want.
Reducing the time you spend connected to the TV or social media will boost your happiness and decrease your desire to waste money.
2. Organizing all aspects of your life.
When you’re living in a mentally or physically cluttered environment, you’ll eventually lose track of what you already have.
That’s a vital driving force behind the incessant need to address scarcity.
Use the time you’re saving by giving up hours in front of your TV or phone to organize everything in your life.
You’ll then clearly see, you already have more than you need. You have an abundance.
3. Adopting a “beginner’s mind.”
Shoshin is a Zen Buddhism concept meaning “beginner’s mind.”
It denotes having an open and eager attitude and a lack of preconceived notions when studying a subject; even when we’re not a beginner in the subject.
When we think we “know it all,” we lose our ability to be creative, see things with a new eye or hear it in a new way, and brainstorm without reservations.
Adopting a beginner’s mind can enhance your experiences, help you build better relationships, and increase your creativity.
4. Sharing with others.
A quote from Anne Frank is appropriate here: “No one has ever become poor by giving.”
When you start to appreciate all that you have, you begin giving more freely to others.
Enhancing the lives of people around you benefits you too. It’s a wonderful feeling to share with family and friends. But being generous and giving freely to strangers in need is very fulfilling also.
5. Giving up on being number one.
If you have a scarcity mentality, everything seems like a competition. You can be obsessed with coming in first to prevent yourself from losing.
But losers aren’t required in the game of life.
Believe it or not, adopting an abundance mentality allows you to see there’s plenty to go around for everyone.
We can all be winners.
6. Halting the comparison of yourself to others.
You are not in competition with your friends, family, neighbors, or coworkers.
When you get caught up competing with them, you end up with everything they wanted and not what you want.
The abundance mindset allows you to practice delayed gratification because you don’t have to have it all now.
You can save time, energy, and money by focusing your spending on your needs and wants without scarcity impacting your decisions.
7. Reflecting on what you have with a grateful attitude.
Research points out that gratitude is associated with many benefits, including improved physical and psychological health, happiness, and life satisfaction.
Additionally, it provides decreased feelings of materialism, burnout, depression, and more.
When you nurture close relationships, act with kindness, appreciate your good health, and volunteer to help others, you’re practicing gratitude.
You can create lists of things you’re grateful for, write letters to those you appreciate, or express gratitude to others.
8. Focusing on what’s working, not what isn’t.
It’s human nature to look for what’s wrong or to focus on what we don’t have. But dwelling on the negatives isn’t healthy, productive, or beneficial for anyone.
Finding the positives and focusing on what’s working helps you grow more optimistic – and attain abundance.
Positivity attracts positivity.
It draws positive people, events, and outcomes to you. It enables you to discover new opportunities, learn from a variety of situations, and keep moving towards your goals.
Your thoughts, feelings, and attitudes about money impact your ability to meet goals and build wealth. While wealth carries a different meaning for each person, most people want to become financially independent.
What’s different about each person’s view of wealth and independence is how they pursue it – and the limitations they either knowingly or unknowingly accept while trying to get there.
Flipping the script from having a scarcity to an abundance mindset isn’t easy. Yet when you shift from being envious of others to being inspired and curious about their success – you’ll be open to learning from it.
That’s when you’ll make fast progress toward your goals and abundant life.
Vicki and Amy are authors of Estate Planning 101, From Avoiding Probate and Assessing Assets to Establishing Directives and Understanding Taxes, Your Essential Primer to Estate Planning, from Adams Media.