As Descartes famously postulated, “I think, therefore I am.” For those whose thoughts tend towards accumulating income, the key is to think like someone who is wealthy.
While you may fantasize about lavish trips and gold-decked ornaments, visualizing the products is generally not the path to becoming wealthy (if it was, I’m pretty sure we’d all be there by now). Instead, embracing some surprisingly simple mental habits can not only transform your wealth but also your health and happiness. Let’s delve into the 6 core principles of a wealth-building mindset.
Maximize value.
Identifying the value of a good or service regards the cost relative to the benefit it provides, from a personal, subjective level, benefits can be variable: a person who likes baseball cards or manicures will be willing to pay more for these items than someone who doesn’t. From a social, objective level, determining value is easier to achieve because of collective spending habits and outcomes.
For example, a value-based mentality would take stock of what one has, what one can acquire, and what one eventually wishes to acquire. Let’s say you want to buy a car. You could find yourself a stylish new coupe, convertible, or sedan (or truck or SUV) and drive off the lot enjoying the new car smell.
The problem is, that new cars depreciate twice as quickly as used cars while needing to be broken in and, over the course of a vehicle’s lifetime, still require maintenance and repairs.
If your goal is to enjoy conspicuous consumption or be a car’s first-time owner, then there is a value associated with the price, but, if you’re like most owners looking for transportation, investing in a proven, used car offers greater long-term value relative to cost.
Finding value doesn’t mean that you have to deprive yourself of or settle for cheap goods. In fact, most skilled craftspeople are well aware that investing more in quality tools offers a greater long-term return than cheap goods liable to break.
However, in many instances, value can be found amid still usable goods, whether you shop clearance, at a thrift store, or frequent a flea market. Finding value is a practice on its own because it might require more research as well as sacrificing constantly meeting a specific demand.
However, if wealth-building is your goal, making your lunch instead of buying out, brewing a cup of coffee instead of getting a fancy latte, and driving a used car instead of a new one will help to save you from spending needlessly so that you can save for more valuable purchases later on.
Be resourceful and find your niche.
Being resourceful incorporates three essential components: how you use your skills, how you interact with your environment, and how you interact with others. All aspects are important to how you build wealth and a reflection of how you think about wealth-building.
Ultimately, all of these elements relate to a less-acknowledged aspect of wealth-building: finding your niche. In truth, there is no specific formula to build because everyone has different skill sets, and wealth-building is an inherently competitive premise that requires one to devote considerable resources to achieve a new earning potential.
Finding one’s niche strikes a balance between the inherent market competitiveness of wealth-building as well as the cooperative capacities necessary to achieve long-term wealth-building.
For example, a resourceful person who exploits one niche will take the time to get to know one’s self. What does one value and what are one’s skills to maximize one’s value? Journaling, meditation, hobbies and even reading are all great ways to try and discover one’s inner capacities that motivate how one approach wealth-building.
Further, taking stock of one’s environment is important to maximizing one’s earning potential. Are you in the right location for your business or job or could you be somewhere more lucrative? Are you in the best housing situation?
Do you enjoy your community or the region where you live (since toiling away in the cold or heat may disincentivize performance for some people)? Most importantly, being resourceful and exploiting one’s niche will help to maximize how productive you are around others.
Who are the friends you spend most of your time around and are they helping you to be productive? Are you productive around your co-workers or constantly competing with them? Are you developing a business network or constantly trying to “keep up with the Jones” and never satisfied?
Being resourceful and taking advantage of your abilities and opportunities within your niche can help you to be more productive relative to your resources, make better value-based decisions and maximize your wealth-building mindset.
6 core principles of a wealth-building mindset
Solve problems.
It’s a fairly simple strategy but incredibly influential on how you build wealth. At the end of the day, one can link one’s net worth to what types of problems one solves, how many problems one solves, and how well one solves these problems.
There’s a reason that a neurosurgeon is paid differently than a medical-billing secretary, and it’s because of the problems each position is required to solve (and, depending on how well you solve them, whether you’re still employed!).
A problem-solving mentality factors into overall wealth-building because it ultimately seeks efficiency. One reason that broad-based index funds can be more successful than investing individual stocks is that they diversify risk.
One reason that diversifying risk across different investment instruments, such as stocks, bonds, annuities, and funds, is because it further solves risk. One reason that constantly investing and paying yourself is a key to wealth-building is that it solves the problem of managing where your money is going.
Ultimately, having a problem-solving mentality, whether in how you earn your income, how you manage your income, or how you manage your life, can maximize your value-based decisions, amplify your resourcefulness and fast-track your wealth-building.
6 core principles of a wealth-building mindset
Be genuine.
Most people think that earning money requires a cutthroat, manipulative approach to controlling purse strings. The reality is that earning money is a reflection of how you interact with people, and genuine people are more likely to be liked and succeed among other people.
Why does genuineness lead to success? If you are a genuine person, you are more likely to pursue activities that genuinely interest you, invest your time more productively, and achieve greater results. If you are genuine, you are more likely to forge meaningful relations with others that can increase overall productivity as well as lead to leadership positions that can increase earning potential.
If you are genuine, you are more likely to pursue opportunities that can lead to expanding your network as well as being exposed to new opportunities that can transform your income or investments.
Since being genuine is a reflection of your motivations, a person who is sincerely invested in solving problems, being resourceful, and pursuing value while living a life of integrity is more likely to succeed in wealth-building and the pursuit of happiness.
6 core principles of a wealth-building mindset
Be consistent.
Becoming wealthy is not a twist of fate but a lifelong practice that is reflected in how one pursues opportunities manages resources (including money!) and invests one’s time. Education, whether to improve one’s job-related knowledge or improve one’s financial savvy, is often cited as a critical factor in how one accrues wealth, but education does little good if one is not consistently learning.
Likewise, the hobbies one pursues, the friendships one makes and the business opportunities one invests in are all reflections of consistent, intentional decisions that seek to build wealth.
Being consistent on the path to wealth-building doesn’t mean being stingy and forgoing pleasurable activities. It simply means that how, when, and how much one pursues is put in balance with regard to the value and long-term goals one has.
Do you like going on vacation? Try a week-long trip once a year instead of going away every weekend. Do you like live music or live shows? Go once a month rather than once a week, especially if you have a saving goal.
Do you like eating out? Try that twice a month instead of every night. Consistency is about constantly refining how one lives one’s life and seeking value and resourcefulness in everything that one does rather than just occasionally.
6 core principles of a wealth-building mindset
Be resilient and positive.
We tend to think of wealth-building as a linear progression, but as many of us know, life is full of detours, mishaps, and pitfalls that can derail our progress. Interestingly, such has been the case for many of the world’s wealthiest who experience failed ideas, businesses, and even bankruptcy along the way. How were they able to regain their footing and earn considerably? Resiliency.
Having a long-term, problem-solving mindset that accepts mistakes as a part of the process and seeks to learn lessons from these situations allows individuals determined to build wealth to constantly find ways to improve.
As with consistency, resiliency is a lifelong practice that seeks constant refinement. We constantly make decisions, many of which don’t always go according to plan. Do we curse ourselves and the world or bemoan our failure if things go awry? A resilient mindset seeks to stay calm, constructive, and objective when problems arise so that a suitable solution can be found.
Ultimately, a resilient mindset, combined with the pursuit of value, problem-solving, resourcefulness, genuineness, and consistency creates a mindset of positivity, and that will result in principles of wealth creation.
Wealthy individuals are positive people who take challenges and achieve to the best of their ability, constantly striving to improve everything from their wealth to their health and happiness. If you’re intending to maximize your wealth-building potential, embracing the above mindset will help to turn your thoughts into profits.
