Reflecting on Flexibility with Wealth Building
January 15, 2025Building wealth requires inhabiting a mindset that empowers you to grow, face challenges, and feel connected to your financial journey. Life’s unpredictability can have a significant impact on our finances, but external factors don’t have to run the show. Your mindset shapes how you approach setbacks and progress, influencing both your portfolio and lived experience.
When we develop psychological skills like flexibility, resiliency, curiosity, and self-empathy, we can navigate life’s obstacles with greater equanimity. In this blog, we’ll share:
- Why mindset matters in building wealth
- Psychological skills to help you build wealth
- Mental traps to avoid
Why Mindset Matters in Building Wealth
Your mindset directly impacts how you approach financial opportunities and obstacles. A scarcity mindset, for instance, might lead you to avoid investing out of fear of losing money, while a growth mindset sees that same situation as a chance to learn and grow.
Remember: a growth mindset is not the same toxic positivity. Pretending life’s difficulties don’t exist will make the growth process even harder. Instead, choose to build skills that will empower you to face real challenges, adapt to change, and move toward your goals with resilience and confidence.
Psychological Skills to Help You Build Wealth
Building wealth requires intentional mental habits. Here are 8 key psychological skills to cultivate for a strong, balanced wealth-building mindset:
Flexibility
Life rarely goes exactly as planned. Flexibility allows you to adjust when things change, helping you navigate both financial challenges and emotional ups and downs. If an unexpected expense arises, flexibility helps you adapt without guilt or frustration.
→ Practicing financial flexibility: When plans change, ask yourself: “What’s one small adjustment I can make to stay on track, or how can I view this as an opportunity for growth?”
Resilience
Resilience helps you recover from setbacks and maintain perspective during difficult times. Practicing resilience requires accepting a setback, receiving its lessons, and taking steps toward rebuilding, even when it’s hard.
→ Practicing financial resiliency: Reflect on a financial setback you’ve experienced and identify one lesson to carry forward.
Decisiveness
Overcoming procrastination and avoidance starts with making small, intentional decisions. Taking action fosters confidence and reinforces your sense of control over your financial life. Instead of delaying important decisions, consider taking a small step today—whether it’s starting a savings plan or reviewing your budget.
→ Practicing financial decisiveness: Choose one financial action to take this week and commit to following through.
Curiosity
Curiosity encourages you to explore, learn, and grow in areas of your financial life that may feel intimidating. It turns fear into excitement about opportunities to learn. When faced with financial projects like estate planning or retirement savings, curiosity helps you find the motivation to explore solutions that align with your needs.
→ Practicing financial curiosity: Commit to learning one new thing about personal finance each month through a podcast, book, article, or conversation with a financial professional.
Self-Honesty
Being honest with yourself about your financial situation and your emotional relationship with money is crucial for growth. Self-honesty allows you to make informed, intentional decisions. Acknowledging when you’ve made financial mistakes helps you move forward without guilt.
→ Practicing financial self-honesty: Reflect on your financial habits. Ask yourself: “Am I being honest with myself about my spending, saving, and investing?”
Self-Empathy
Building wealth doesn’t require perfection—it’s about treating yourself with empathy, especially when things don’t go as planned. Self-empathy helps you continue moving forward without harsh self-criticism. If you make a mistake or face a setback, practice self-compassion instead of self-blame.
→ Practicing financial self-empathy: When facing a challenge, remind yourself: “I’m doing my best, and I’ll keep improving.” This mindset keeps you grounded and helps you build confidence in your financial journey.
Reflection
Taking time to reflect on your financial life helps you explore your purpose and clarify your “why.” Knowing your deeper motivations makes it easier to stay connected to your goals and find meaning in your wealth-building journey.
→ Practicing financial reflection: Regularly ask yourself: “Why is this goal important to me? What does financial freedom look like in my life?”
Acceptance
Accepting where you are now and recognizing that there is always something ahead can provide peace and clarity. Acceptance doesn’t mean complacency; it’s about acknowledging your current situation and trusting that growth is part of the process. Receiving where you are financially right now—whether that’s a debt reduction journey or the early stages of investing—allows you to move forward without guilt.
→ Practicing financial acceptance: Accept where you are today and trust that each step, no matter how small, will bring you closer to your goals.
Mental Traps to Avoid
We all have psychological traps that tend to trip us up. Ever waited for the “perfect” time to invest? Or avoided checking a credit card bill? You’re not alone. These pitfalls can cause stress, guilt, and stagnation. Here are a few mental traps to watch out for:
All-or-Nothing Thinking: Believing that a single financial misstep means you’ve failed.
Example: “I overspent this month, so there’s no point in budgeting anymore.”
How to combat the trap: Opt for resilience and reflection. Every misstep is an opportunity to learn a lesson and take a step in a new direction.
Procrastination: Putting off important financial decisions.
Example: Avoiding conversations about retirement planning because it feels too far off—or too intimidating.
How to combat the trap: Choose to look your challenge dead in the eye – but make it cozy. Throw on your favorite sweater and take your looming financial task on a date to your favorite coffee shop!
Perfectionism: The belief that financial decisions need to be perfect to be valuable and wise.
Example: Waiting for the “perfect” moment to start investing or save for retirement can delay progress.
How to combat the trap: Focus on progress, not perfection. Small steps forward can make a big difference over time.
Shame: Holding the belief that you are fundamentally flawed and therefore unworthy of connection.
Example: Feeling ashamed about credit card debt may make you avoid looking at your finances altogether.
How to combat the trap: Practice self-compassion and recognize that you are telling yourself a story about who you are. By facing your fears and asking for help, you can rewrite your story.
Mindset as Your Foundation
Cultivating a healthy money mindset doesn’t mean ignoring life’s challenges. It means equipping yourself with the skills to face them head-on. By avoiding common mindset traps and practicing skills like flexibility, resilience, and curiosity, you can navigate the complexities of wealth-building with confidence.
Ready to take the next step? A financial partner can help you put these mindsets into action. Reach out to Alicia to schedule a complimentary call and start building a financial strategy that supports your goals and values.