This is where the millionaire mindset comes into play. A millionaire mindset stands apart from the beliefs and patterns that most people follow. It relies on clarity, discipline and making your money work harder for you.
Why Is a Millionaire Mindset Important?
Do any of these scenarios sound familiar?
Surviving from one paycheck to the next with little extra to show for it at the end of each month Living with no financial buffer to safeguard against job loss, illness or emergency bills Having no plan for or even avoiding the thought of retirement
None of the above are unusual, but each one of them places you in a precarious financial position. A millionaire mindset asks you to think outside the constraints of the commonly held attitudes that got you into this kind of situation in the first place.
How Does a Millionaire Mindset Work?
The millionaire mindset asks you to look at your life, your abilities and your money in a different way.
Your Life
Many people live for the now. They feel that because they have earned their paycheck, they deserve instant gratification. This is one of the main reasons why people have nothing left over financially at the end of each month. Alternatively, you may aspire to be like the latest Instagram influencer or your favorite actor. They have XYZ so you buy XYZ, or the nearest version that you can afford. You find yourself with lots of things, but no financial elbow room should an unexpected bill land on your doormat. You may be able to afford the latest model of your favorite car brand, but do you need it? Will the car you already own or a more reasonably priced car model/brand suffice? The millionaire mindset asks that you live not only within your means but below them. This helps you to build up a safety net of extra funds for emergencies, investment and future plans.
Your Abilities
A millionaire mindset asks that you maximize your abilities. For instance:
Studying for a degree or qualifications that will lead to a lucrative career path Finding a summer job between school or college terms Applying for that promotion, rather than staying in the same comfortable job. Investing in yourself by taking extra courses to develop your knowledge and skills Creating a career plan that will progressively increase your seniority, expertise and ultimately, your salary
The millionaire mindset asks that you make the most of your potential.
Your Money
You may think that adding to your savings each month is the best way to make your spare money work for you. You should always check, however, that the level of interest paid by the savings account is above the current inflation rate. If it is lower than inflation, your money will depreciate in value, buying you less for your dollar. Look out for savings accounts, therefore, that have an interest rate over the level of inflation. How else can you make your money serve you better?
Invest in stocks and shares, or other financial markets Reduce or pay off debts before you buy anything new Pay more towards your mortgage to reduce the amount of interest you are paying and ultimately be mortgage-free sooner Pay more into your 401K pension plan to ensure a more comfortable retirement If you spend on a credit card, pay the total off at the end of the month to prevent interest being added to your debt
A millionaire mindset asks that you spend, invest and save wisely. Want to find out why investing your money could be the right step for you? Read Top 10 Reasons to Invest.
How to Build a Millionaire Mindset
If taking control of your financial future appeals to you, here are our key tips on how to build a millionaire mindset:
Set Goals
Building wealth is not an overnight process. It takes time, patience and hard work. This means that you can easily become disillusioned if you do not have a goal to work towards. Your goal might be to pay off your mortgage early by paying extra each month, so that you do not have to worry about being able to afford your mortgage payments once retired and you can remain in the home you love. Or your goal might be closer than retirement. It could be to pay off your credit card debt by increasing monthly payments and not using the card until the balance is cleared. With a lower level of debt, you can move to a part-time position so that you can care for a loved one. Setting a goal provides you with the ‘why’ for cutting back on spending, taking those extra night classes or spending spare money on your debt instead of a holiday. It provides clarity and a reason to persevere. To find out more about goal setting, read our article on setting SMART Goals.
Focus on Growth
No, this is not about growing your wealth, although it may well have that effect. Focus on growth as a person, for instance:
Growing in experience as you progress along your career path Growth in knowledge and skills as you invest in your ongoing personal development through courses and books Growth of your opportunities as the amount of wealth you receive as a result of your millionaire mindset opens new doors and allows you to enter new arenas, both professionally and personally
Develop Your Vision
Developing your vision is a three-part process:
Understanding the ‘why’ Recognizing the ‘what’ Planning the ‘how’
Your goals are the ‘why’, for instance, to fund your child’s college education, retire early or buy a holiday home. The ‘what’ is how your life will be once you have reached that goal, for instance, a comfortable retirement with plenty of holidays or less worry over your children’s future. Planning the way you will reach your goals is the ‘how’. Will you forego a couple of holidays, buy less expensive brands or invest your savings? Will you strive to advance up the career ladder and bring in a higher salary? What are the things you will do to fulfil your vision? Want to plan out your career but not sure how to start? Read our 10 key tips.
Focus On Problem-Solving
Too often people limit themselves by seeing problems as walls rather than hurdles. What does this mean? Let’s consider an example. You apply for promotion to a manager at work. However, you are rejected because your employer believes that you do not have sufficient leadership experience. Some people may see this as a wall that cannot be scaled, and give up. However, others will look at this rejection as a hurdle, a problem that can be solved. In this instance, soaring over the hurdle means obtaining that leadership experience, perhaps by taking extra responsibility at work and heading up steering committees. Alternatively, you could seek out leadership opportunities outside of work to build your skills and experience. A millionaire mindset asks that you not only develop your problem-solving skills but that you also begin to see barriers as doors to be unlocked. Problem-solving is just one sought-after soft skill. To discover what else employers are looking for, read our list of 10 key soft skills.
Invest Your Money
You work hard for your money, so make it work hard for you. Investing your money is the best way to do this. You could invest your money in:
Your 401K pension plan An IRA (Individual Retirement Account) Company shares that pay dividends Other financial markets, such as forex or commodities Property, with the option to receive regular rental income
The easy option is to leave your money in a savings account. The millionaire mindset does not rely on easy options. If you would like to invest in shares and stocks, you might be interested to read Top 12 Best Stock Trading Apps.
Embrace Attention
Embracing ‘attention’ is important for a millionaire mindset. First, it is all about paying attention, whether to your investments, opportunities or progress. A millionaire mindset demands you live with an awareness of how your future is unfolding and an eye on your goals. Second, it is about enjoying the attention you will attract as you develop the millionaire mindset. Success will often place you on the radar of people who may not have noticed you otherwise. Finally, to grow into your new mindset, it will often be necessary to promote yourself. This could be:
Applying for a senior role at work and selling yourself to the interviewer Seeking finance or sponsorship for your business Networking with colleagues or peers
If you would like to develop your communication skills, you may find some key tips in our article The Best Ways to Make Business Small Talk.
Find Passion and Purpose
It might sound like developing a millionaire mindset is all hard work. While hard work does play an important part, developing a millionaire mindset is also about finding your passion and purpose in life. Seeking wealth for wealth’s sake is unlikely to make you happy or be sustainable. Seeking wealth, however, to fulfil your purpose in life and allow you to follow your passion is a path to success. What is your purpose? Is it:
To build a sustainable business that can help a lot of people? To share your creativity with the world? To create a safe environment for your family?
Your purpose is the bigger picture behind everything you do. It does not have to be lofty and grand. It may be something completely private and personal to you. Passion is all about living a life you love. It may well encompass running a brand that you are enthusiastic about, spending time with loved ones, following that hobby that excites you or making a real difference in your culture. Working to simply obtain money without taking any pleasure in your life is likely to lead to resentment and burnout.
Final Thoughts
The millionaire mindset is an ongoing, long-term process that involves perseverance, hard work and a need to change your way of thinking. It asks you to give up instant gratification for future gratification instead. It is not for the impatient or faint-hearted, but it is one of the best ways to build a brighter future.
