“If I only had more money then I could _____”
I’ve had these thoughts, and I bet you have too. If only we could save X amount, we’d reach financial independence (FI) faster. If I could just make more money, cut more expenses, grow more food, or win the lottery (oh, wait, I don’t play)…
We devour money saving, money making tips and tricks. We read and research how to save more, make more, live frugally, invest, and pay off debt faster. And there is no doubt this knowledge is helpful.
But if you think of money as the answer to all your problems, you’ll get nowhere fast. If you give money all the power and control, feel deprived trying to get more of it, and define money as your saving grace, you’ll never win.
80% of success is psychology and 20% is mechanics.” – Tony Robbins
How we view money
Money as the goal.
If you are living paycheck to paycheck, struggling to pay the rent or buy groceries, it seems like more money would solve your problems. Money becomes the big obstacle in your life, the thing that you need but can’t seem to get more of.
You need more money.
But why do you need more money? When you take a closer look, money isn’t the real goal here, happiness is. Because paying the rent keeps a roof over your head and eating keeps hunger at bay – both create some degree of happiness.
I’m not denying that money can solve problems. It certainly can. But how you think about money affects how you use it.
Money can be seen as the necessary evil in your life or it can be something you strive for. Either way, having “more money” as the goal gives money all the power and control.
The mindset that we are at the mercy of our money is at the heart of many of our financial problems.
We give more power to money than it deserves. We let it control us. We attach emotions and feelings to it. We even judge people’s worth based on how much we think they have.
Let me restate Mr. Robbins quote in personal finance terms – 80% of success in personal finance is how you think about money and 20% is the actual numbers (and the actions you take to make those numbers work for you).
Money itself doesn’t create happiness. It’s a tool that, when used as such, can help create a life that leads to happiness.
Use money as a tool
A tool is “a device or implement, especially one held in the hand, used to carry out a particular function”.
Think about your tools. Do you know where your hammer, screwdrivers, and wrenches are? Do you keep them clean and organized, ready to use when you need them? Or do you just toss them aside, allowing them gather dust and get rusty?
If you neglect your tools, they will be worthless. Either you won’t find them or they won’t work when you need them most. But if you care for them by keeping them organized and clean, they will do their job beautifully when you need them – saving you time and energy.
What if you applied this concept to money? What if you took care of it as it came to you, kept it organized and ready to be used? What if you used it, as it was intended, to build things (savings, net worth) and had it ready when you need it most (emergency fund).
When you think of money as a tool, it becomes easier to use it for what you need. You stop thinking of cutting back on expenses as painful and instead see it as a way to create the life you want.
Your mindset shifts from feeling deprived and wanting more, to feeling in control and making conscious choices about how you use your money.
Use Your Money
Let’s continue the tool analogy. You don’t attach emotions to that hammer in your toolbox (right!?). When you use your hammer to pound in a nail, do you feel guilty or bad about it? Not likely. You are simply using the hammer as it was intended to be used.
Apply this to money. Money is meant to be used. You shouldn’t feel bad when you’re using your money. If you do, you need to seriously reevaluate how you’re using it.
As an example, Alan and I used the money we saved in our Digit account to pay for a recent vacation. Family time is a high priority for us. We had already saved the money for the trip, so instead of feeling guilt when we spent $100 on a seafood dinner, we were able to relax and enjoy the time with our kids. In this case, we were using money as a tool to create lasting memories with our family. (We use money as a tool to give us more choices and freedom as well – which is why we save and invest so much of it, in addition to intentional spending.)
What happens when you make the shift
Granted, it’s easy to view money as a tool when you have it. It’s harder to make the shift when so many of your problems seem money-related. And just because you shift your mindset and start thinking of money as a tool, your money-related problems won’t disappear.
But what will happen is you will start to take control. You will become more intentional about using your money and ask yourself how you can make it work for you. You will search for answers and strategies and more choices will become clear. Ultimately, you will start to take action.
Shift your mindset. Strip money of it’s power and control over you. Stop attaching emotions to an inanimate object. View it as it really is – a tool for life.