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“We want money but we’re also scared of it… because we’ve been abused by money in some way. Usually starting from childhood.”
This powerful statement was made by Best-Selling author Ken Honda in an interview on Tom Bilyeu’s YouTube show Impact Theory.
Needless to say, it blew my mind!
And immediately had me thinking about my own relationship with money.
The phrase “abused by money” hit me especially hard.
Abused.. like a person would abuse you in an abusive relationship.
I’d never thought to look at money that way before.
To test whether Ken’s statement was true for me, I did an exercise to uncover my feelings about money from the perspective of money being a person.
This is what I came up with:
If money was a person, how would they be?
- Hard to get
- Easily offended
- Has a temper
- Picks and chooses who to be with and who to be nice to/generous with
- Like a snobby popular kid who only picks their friends to be on their team or go to their parties.
- Looks down on anyone who doesn’t have what they have and gets everything they want
- Picky and unappreciative
Before doing this simple exercise I had no idea that my attitude towards money was this negative!
Basically, what it tells me, is:
- I’m jealous of money,
- I’m afraid to be around money,
- I wouldn’t spend time with a person like that so apparently I don’t want to be around money,
- I wouldn’t be comfortable around them,
- I don’t feel like I’d ever be good enough for them … so they wouldn’t like me or want me around either,
- I’d reject them first because I know they’d reject me If I gave them the chance
In other words, I reject money and feel rejected by it. At the same time.
So I do feel abused by money. And it has shaped my entire relationship with money.
Ken Honda was right!
But the twisted part is, it wasn’t money itself that created my “abusive” relationship with money. It was people.
It was how the people around me:
- Talked negatively about money,
- Argued about money,
- Worried about money every week/month,
- Used money in destructive ways,
- Treated me when I didn’t use or spend money the way they believed I should (ex. shame/guilt trips)
For example, if I:
- Spent too much (their opinion),
- Bought something they didn’t approve of (nicer clothes) instead of buying something cheaper or saving my money,
- Asked them to buy me something (as a child),
- Wasted food or didn’t appreciate a toy enough, etc.
What is Your Relationship with Money?
I’m sure you can relate to some of this. And have probably started wondering about your own relationship with money.
Ken Honda helps people heal their past traumas about money so they can be at peace with their money while feeling happy and fulfilled with their lives.Ken Honda helps people heal their past traumas about money so they can be at peace with their money while feeling happy and fulfilled with their lives. Click To Tweet
But before we get to his solutions for making peace with your money, we have to uncover and understand the traumas that brought about our “scarcity mindset” in the first place.
Once you get through that, you’ll:
- See how those traumas have affected your life and are still at work in your current life.
- Be shown a real-life case study of a scarcity mindset in action to help you recognize similar patterns in your own life.
- Learn the “zen millionaire’s” approach to creating a positive relationship with money.
- Have the opportunity to see the video interview for yourself and hear Ken Honda give tips from his book: Happy Money: The Japanese Art of Making Peace with Your Money.
- Have access to additional money mindset resources, including: exercises, tips, articles, blog posts, a podcast interview featuring Ken Honda and a list of the best money and abundance mindset books I could find.
We have a lot to cover, so let’s get started.
Here is a table of contents. Feel free to skip ahead at any time.
What Causes a Negative Relationship with Money?
Scarcity mentality is a phrase coined by Stephen Covey in his book The 7 Habits of Highly Effective People. And is another way to describe a negative relationship with money.
The difference is that scarcity mentality includes so much more than just money.
Scarcity thinking spills into all areas of your life and as a result, it can sabotage all areas of your life. From hoarding everything you get to avoiding risks and opportunities to better your life.
It’s also referred to as a scarcity mindset or poverty mindset.
“By definition, poverty mindsets are ones in which the person self-sabotages, accidentally undermining their quest for abundance by adopting a negative stance towards wealth. This makes it impossible for you to vibrate on the high frequency required to attract abundance.”
How can you achieve any type of long-term financial success if mentally and emotionally you have a love-hate relationship with money?
Meaning that although you want money on a conscious level, your subconscious beliefs and feelings are against you having money.
As long as these opposing forces are at work, you’ll sabotage your success in some way or another. And not just your relationship with money will suffer, but also your relationships with people, your health, your passions, and your other goals.
A scarcity mentality can keep you from setting concrete plans to pursue your goals and from taking action towards them.A scarcity mentality can keep you from setting concrete plans to pursue your goals and from taking action towards them. Click To Tweet
Exploring Your Negative Relationship with Money
“Money doesn’t grow on trees.”
“We can’t afford that.”
“We don’t have enough money.”
“You can’t have everything you want.”
“Do you know how much I had to work to pay for that?”
“You don’t need that, you already have enough (toys, clothes, books, etc.)
“Maybe when we have more money, we’ll…”
Have you heard phrases like these at some point in your life?
Of course you have. Unless you grew up around people who all had abundance mentalities. And if you did, you’re the minority.
But for the rest of us, scarcity mindset phrases like these are common. You can probably still hear them playing through your head when you’re thinking about money, talking to other people about money (especially to kids), or making decisions involving money.
You heard them, they were drilled into you in emotionally charged ways, so you remembered them, and now you might even repeat them. To yourself and to the younger generations.
Obviously, they create negative feelings and attitudes towards the subject of money.
But the question is … are these phrases traumatic enough to have created an abusive relationship with money?
For some of us, probably.
But scarcity mentality doesn’t stop at casual, “realistic” phrases. It can look more like this:
- Hearing your elders blaming the government, rich people, the economy, bad luck, or God/Universe for their money problems
- Getting told that only certain kinds of people can be rich and to be “realistic” or give up on your dreams
- Getting shamed, humiliated, or physically harmed for how you spent your (or someone else’s) money
- Wanting to join a group/club, play a sport, or pursue a hobby but got told (or treated like) you weren’t worth the money
How Does Scarcity Mentality Affect Your Life?
“It is an unfortunate reality that many of us are not taught about money growing up, but are expected to succeed when thrown into the real world.
Then, when we struggle to make ends meet, we beat ourselves up about our self-worth and feel like we are not successful.”
Once the damage is done and the traumas are set in, in what ways can a scarcity mindset manifest in your present life?
Answer: A scarcity mentality can affect your life in more ways than I can list here.
You’ve probably observed or experienced a number of these. The first thing you’ll notice is that some relate to your relationship with money while the rest relate to other areas of your life.
Scarcity Mentality in Action
- You almost ALWAYS make choices based on whatever is “the cheapest” even when it’s not what you really want, healthy for you, safe, solve the problem, or in your best interest at the time.
- Making excuses (justifying your situation) that stem from the feeling “I don’t deserve any better”. This can mean better quality products, nicer things, better situations, better health, a better job, positive people or healthy relationships.
- Being jealous or envious in different areas of your life points to a scarcity mindset. For example: believing that your significant other won’t have enough time or love to give you if they’re giving some of it to someone else. Whether it’s a family member or other friends. You see everything as a limited quantity or a competition.
- Making your whole world revolve around a girl/guy or any obsession to the point that you hang on too tightly (clingy) or neglect everything else in your life (friends, hobbies, family, health). This all stems from the feelings of scarcity and lack within yourself.
- One that I heard a lot growing up was “when we have more money, we’ll…” More money (and whatever we were going to have, do, or be) was always projected into the future. This creates a perpetual feeling of “missing something now” because happiness and fulfilment always seem far away and always dependent on some future event.
How many of these can you relate to?
Has this helped you see symptoms in your own life of how having a negative relationship with money and abundance has sabotaged your life?
Ken Honda’s Impact Theory interview really got me thinking about and researching these subjects.
Which has inspired me to review the past 20 years of my life. It didn’t take long before I saw the ways that having a scarcity mentality has played out in my financial life, friendships, and intimate relationships.
I’ll provide plenty of additional resources and exercises further down in this post so that you can get to the root of your own scarcity mindset faster than I did.
But before I do that, let’s explore how having a scarcity mindset negatively influences our decision making abilities.
How the Scarcity Mindset Can Make Problems Worse
This section explores my personal relationship with money and how having a scarcity mindset has affected my work habits, spending habits, physical and emotional health.
I wrote this section in hopes that will be relatable to you in some way. And show you that you aren’t alone in your mistakes or struggles.
If you’d rather go straight to the tips, exercises, and solutions that’ll help you transform your scarcity mindset into an abundance mindset (and a positive relationship with money) go on to the next section.
Scroll down to next section.
Understanding My Relationship with Money
My own mistakes with money were fueled by my lack of experience, lack of financial education, a scarcity mindset, and a negative relationship with money.
I’m grateful that I have a better understanding of financial literacy now and have forgiven myself. To move forward, you may need to do the same.
What were my mistakes? What does a scarcity mentality look like in real life?
■ For me a scarcity mindset meant working long hours for small hourly wages and eventually feeling like that’s all I’d ever deserve.
For example, I started my first job during the late 90s at a buffet making $5.25/hr. And it was a year before I asked for a raise (low self-esteem) that only took me to $5.90/hr.
■ I prided myself as being a “hard-worker”. Why? Because of status and tradition. McMillan men were known for being hard workers.
In this way scarcity mentality meant working more hours than the people around me, even though it wore me out, cut into my sleep, interfered with my school work/band/basketball, and I rarely saw my family. It’s what I thought I had to do for money.
I equated making more money with enduring more stress, struggling, pain, and suffering. And I prided myself on suffering more than everyone else was willing to.I equated making more money with enduring more stress, struggling, pain, and suffering. And I prided myself on suffering more than everyone else was willing to. Click To Tweet
■ When it came to my relationship with the money I was working for, well I was spending it as fast as I earned it.
Like a lot of teenagers with their first job, I bought whatever I wanted to. But I felt like whatever I bought had to be worth the hell I was putting myself through to make the money. So I was obsessed with quality (Ex. Expensive clothes, watches, sports cars, new CDs).
Even though my self-worth dropped lower and lower, on the outside, I wanted to look happy and successful.
■ “When we have more money…” I realize now that I was always looking towards the future for salvation from my money problems.
Salvation meaning: a better job, after college, after I got an engineering job, after I worked my way up in a company after I started a successful business… then I’d have enough money… then I could relax.
■ Going into student loan, auto, and credit card debt through college because I got in over my head, didn’t know how money worked, didn’t have any savings/bonds/investments/ or assets to handle all the unexpected expenses.
Had no idea that teenagers were supposed to have or even understand those things.
■ Working 2 or 3 jobs while trying to keep up with college. I was doing emotional spending to deal with the depression, anxiety, and insomnia brought on by the money problems, eventually getting sick from the unhealthy way I was living.
The depression worsened and lasted through the rest of my time at college. It took so long to break out of it because my scarcity mentality only let me see the world as a cold, dark, place, full of bad luck, negativity, and limited options.
■ Filing bankruptcy after college.
Even though I had come out of the depression, had started studying financial literacy and entrepreneurship, I was job searching and things were beginning to look up … life had other plans for me.
Out of nowhere, one of my retinas detached, leaving me blind in that eye three surgeries later.
Needless to say, it took a lot of adjusting and my financial goals were put on hold, again.
■ Eventually I rebuilt my credit, but the deferred student loan debt has made it impossible to get a mortgage.
■ Ending up in debt again 10 years later from living on a low income as a stay-at-home dad and trying to keep up with life, kids, hobbies. You know … living like a normal person.
■ Starting a photography business to help friends and family and pay for my expensive hobby … but being too afraid of equipment malfunctioning (again) or the possibility of making mistakes during an event to take on more than a few small gigs at a time.
The thought of taking on too much responsibility, making costly mistakes, getting sued, or having to give refunds for disappointing clients kept me up at night and kept me from making any real money. Even though I trained, practiced, had backups, and became really good at what I was doing.
I avoided risks and turned down opportunities as a way of life. I saw competition everywhere and was jealous of the successes of “better” photographers who were living my dream.
Scarcity Mentality is a Dream Killer
All of these scenarios show a scarcity mindset at work. Fear, anxiety, playing small, avoiding risks, bad financial decisions, and constant self-sabotage.
This combination makes it nearly impossible to get ahead financially or to chase after your dreams. You probably won’t even let yourself believe that you can. Your ‘reality’ will continually show you proof that you can’t.
But it can be another way.
“What we believe determines our motivations and our actions and these determine our outcomes.
To be clear: this isn’t about making a wish that magically comes true. It’s about taking action on what you actually believe.
The musician who believes she can fill her studio or the one who believes she can book a tour are the same musicians who will take the actions needed to make these things happen. Our actions and our eventual realities conform to our beliefs.”
Ken Honda’s Tips for Healing Your Relationship with Money
The past is the past and the damage has been done. So how do you move forward and heal your relationship with money?
Below are some of the positive money mindset tips that Ken Honda and Tom Bilyeu discuss during the interview.
I’ve also included the YouTube video at the end of this section in case you want to check it out for yourself.
Tip #1 – Forget About Money
“Forget about money” is something Ken’s mentor said to him. He goes on to say that this doesn’t mean to stop thinking about money altogether or to stop taking care of your finances.
Sorry. You still have to pay your bills.
He took this quote to mean stop trying so hard to make money and stop making life all about money. See money as the end goal … as a result of the other things you do … but not as your primary focus.
What should be your primary focus to heal your relationship with money then?
That’s his second tip.
Tip #2 – Develop Your Gifts and Happy Money Will Follow You
Instead of obsessing over money, Ken suggests that you focus on developing your gifts and talents.Instead of obsessing over money, Ken Honda suggests that you focus on developing your gifts and talents. Find a way to add value to people's lives. Click To Tweet
Even if you haven’t found your higher purpose and don’t have an olympic athlete level talent to pull from, you can still find a way to add value to other people’s lives.
He’s helped people do this by teaching them to combine their “mediocre” gifts and talents into something that can both make them money and bring them joy.
Because to him, wealth is more about being happy and fulfilled than it is about how much money you make.
“Money itself is just a measure of how much we are helping other people. How much value we are adding to the world.”
Tip #3 – Don’t Compare Yourself to Other People
We are all different. So we have different gifts and talents. We all bring something different to the world.
Don’t compare yourself to others, what they have, and what they’re doing better than you.
Focus on what can come out of you that can bring you money and entertain (or educate) others.
You do this by being curious about life and exploring your gifts and passions.
The zen approach to life and money is about finding peace and happiness.
“Do it for the process, not the prizes, and your life will be so much better.
– Gary Vaynerchuk
Tip #4 – Invest in Friendships
“Fearing no money situations keeps people from taking risks, starting businesses, etc. People are obsessed with not ending up in those situations.”
When you have strong relationships with friends you can feel safe knowing that even if you lose everything, you have a supportive network of people who will help you and “catch you”.
You won’t have to worry about the future or ‘no money situations’.
Here is the Impact Theory interview on YouTube.
Resources and Exercises to Help You Go From a Scarcity Mindset to an Abundance Mindset
Scarcity mindset versus abundance mindset is a topic I’ve read about here and there over the years, starting with Napoleon Hill’s Think and Grow Rich.
But with everything going on in my life recently, I’m glad I stumbled onto Ken’s Happy Money approach to this subject. It has inspired me to do more research, exercises, and buy more books so I can finally create lasting financial changes in my life.
So far I’ve:
- Read a ton of articles and blog posts about money mindset
- Made a list of books to order about abundance mindset topics to improve my relationship and understanding of money
- Added abundance affirmations to my daily affirmations list
- Saved money every month – saving up an emergency fund and an investment fund
- Cut credit card spending down to almost zero over the past few months. Credit score has improved. This wasn’t too hard because I haven’t gone back to the gym since the quarantine started and I rarely go anywhere else (where I’d need to spend money).
Transform Your Relationship with Money
To help you get started, in this section I’ve provided some of the best money mindset exercises I’ve found (and used) during my research as well as a list of books and articles on the subject to help you go even deeper into your own understanding of scarcity thinking, money mindset, abundance, and financial literacy.
“You know how you feel about your best friend or new crush?
It’s time to consider your money in the same way.
Treat your money like you support it — have your money’s back.
Your money is your friend and it deserves your love and respect.
Your relationship with money matters.”
Exercises to Change Your Money Mindset
■ Dr. Paul McKenna, author of I Can Make You Rich wrote a great article on the subject with practical exercises for uncovering your subconscious beliefs related to money, it’s called
He gives you a list of statements about money so that you can evaluate your reactions to those statements.
There are several self-awareness type exercises throughout the article to give you a better understanding of your current money mindset.
This is how one of my exercises turned out. I wrote down each statement Dr. McKenna suggested and then the thoughts that came to mind afterward. It looked like this:
■ I deserve money.
- Not unless I work hard enough for it.
- Or write enough content, build traffic, and do everything right in my business to get money coming in.
- Or get a low paying job (or any job I qualify for) and work long hours, make sacrifices.
- Not unless I make enough time and effort sacrifices. Put in the consistent work. Be better than I am now in some way… in a lot of ways.
■ Money can come to me easily.
- Only in small amounts. Like SSI, rent rebate, or small gifts from family to help out with traveling (to visit) or special occasions.
- The ssi wasn’t easy. It came at a cost. Losing my eye. Bad vision. Bankruptcy. Starting over.
- It always comes at a cost. Suffering. Loss of something.
- Or at the generosity of others, but not because of my own efforts, talents, skills, etc
■ There’s more than enough to go around.
- Maybe for other people. And those that know what they’re doing. But I don’t know how (have experience) getting my share of that infinite pot of gold
- For those who really go for it and aren’t afraid to take the risks and make things happen
■ It’s okay for me to be rich.
- Yea but I won’t let myself
- I don’t feel like I deserve it yet
- I haven’t earned it
- I doubt anyone else would believe that I deserve it
- There are plenty of people who deserve it more than I do
In the article, Dr. McKenna describes another mindset transforming exercise in this way:
“At first, I used a simple system of substitution. Anytime I noticed myself grumbling inside my head at the success or wealth of someone else, I would immediately replace that thought with a positive one wishing that person well. It felt strange at first, but each time I did it, I noticed I felt a little bit better inside myself.”
These types of exercises are eye-opening. And show you mental programs running beneath the surface that you never knew existed.
Check out the article (linked above) for more information and exercises. And here is a link to his book, I Can Make You Rich.
Judging by his articles, knowledge of the subject, and the book’s reviews, it’ll be worth reading.
I plan on ordering it soon so let me know if you’ve already read it and how it helped you.
■ Money Mindset Coach Natalie Bacon gives this tip:
“When you hold on to your money because you want to instead of because you feel the need to, you’ll realize that this comes from a place of feeling good and comfortable with it.”
This helps you feel okay about having money in general. Money doesn’t have to be seen as a means to another end. For example, needing money to pay a bill or needing money because you need the new iPhone.
Just having money for the sake of having money is enough. And is a relaxing thought if you think about it.
So much of our “normal” money thinking is filled with anxiety and future planning.
■ In the article, It’s All in Your Head: Why a Scarcity Mindset Is Keeping You Poor, Grayson Bell explains the importance of overcoming the scarcity mindset in this way:
“The scarcity mindset also causes people to make poor decisions. When you are worried about your bank balance, for example, you might put off opening the bills or pay at the last second (or even late). Yet the issue won’t go away on its own and in fact will only get worse — thereby increasing the feelings of scarcity.”
And goes on to suggest these solutions:
- Shift your language to the language of prosperity. Using scarcity language reinforces the beliefs that we are trying to get rid of.
- Let go of old and unused stuff. Stop hoarding. Give, donate, throw away. Because “You’ll instantly feel wealthier.”
- Don’t overspend out of ego (to be better than/or keep up with others.
- Practice being happy for and inspired by others success, not jealous or resentful.
■ Since creating more abundance in your life and the Law of Attraction go hand-in-hand, Michelle at WhoSaysWhat uses this exercise:
“One of my favorite ways to use the Law Of Attraction (for money) in my everyday life is while I am meditating. To do this, simply say 5-10 positive money affirmations either aloud or in your head while you meditate.”
Two example positive money affirmations she gives are:
- Earning money comes easy to me
- There is no limit to how no much money I can attract
For more affirmations, check out her article at the link above, google up “money mindset affirmations” and “abundance affirmations”, or you can learn how to write your own affirmations.
The main benefit to writing your own is that it makes each affirmation ultra-personal to your life situation and specific needs.
I’ll be covering this topic in a future article. Where I’ll teach you how to write affirmations that are extra persuasive at getting you to take action towards your goals.
■ Other Money Mentality and Abundance Mindset articles worth reading
What Are the Best Books to Change Your Money Mindset?
So far I’ve put together this list. Some I’ve read and the rest are part of my ever-growing (and hard to keep up with) reading list!
I’ll link more books to this post when I finish my next blog post which will be completely devoted to finding the best books for changing your relationship with money.
Here’s the book list, in no particular order.
1) Happy Money: The Japanese Art of Making Peace with Your Money by Ken Honda
- I’ll probably read this one next since it focuses completely on the mindset part, which is where everything else stems from.
2) I Can Make You Rich by Dr. Paul McKenna.
- This one also seems to focus on the mindset shift but adds exercises to explore your subconscious programming.
3) Think and Grow Rich by Napoleon Hill
- I read this one 15 years ago and it helped me fall in love with studying the mind, subconscious mind, and the principles of the universe to begin with.
- It changed my view on how the universe worked, where I fit into it, and how to get more of what I wanted out of it
- There’s a good reason why so many people recommend this books
- My sister let me borrow this book over a decade ago when she found out I was interested in starting a business. I loved the content and his teaching style.
- His information was the first financial literacy type information I was ever exposed to. And confirmed my feelings about being an employee versus being an owner or investor.
5) You Are A Badass At Making Money: Master the Mindset of Wealth by Jen Sincero
- I have to check this book out to see what all the hype is about. It was referenced and recommended in a few of the articles I’ve read recently. Plus, I love the title.
6) The Total Money Makeover: A Proven Plan for Financial Fitness by David Ramsey
- I read this last year and it inspired me to focus on building an emergency fund first since this will keep me from relapsing into credit card use everytime an unexpected expense comes up. And then to pay off debt using a method it teaches called the debt snowball method.
- This is for those who learn better from a “tough-love”, “tell it like it is” approach.
- This book focuses more on the financial parts than on the mindset but at the same time Ramsey teaches you what kind of mindset it will take to get out of debt the fastest way possible.
Conclusion – How to Think Abundantly Right Now
A thought came to me while researching abundance mindset information.
If I tried to give away everything that I have to give, I’d run out of hours in the day before I could.If I tried to give away everything that I have to give, I'd run out of hours in the day before I could. Click To Tweet
Wow, what a realization. That’s such a powerful thought.
I don’t mean only giving money. Obviously, I don’t have that much!
Giving comes in as many forms as there are people on this planet. Everyone has something to give. You can give in any way you want to. In any way you can dream up.
You can give:
- Your time and presence. Sometimes just being there, providing company or a non-judgmental ear is enough.
- Your money or some other property.
- Your knowledge and expertise to anyone who wants to learn from you (ex. Teaching someone, using your training to solve a problem, helping them with photography or technology, using your medical training or trade skills).
- Practical information and general skills just to help someone get through the day (ex. How to cook, do laundry, drive a car, play a game, use a machine at the gym).
- Your help throughout the day to anyone in need. Even something as simple as holding a door open for someone counts as giving.
- Your energy to the spiritual evolution of humanity through meditation, selfless service, or even prayer. Any way that you raise your level of awareness/consciousness or better yourself from the inside out, “raises the water level and lifts every ship”, benefiting all of existence.
So don’t sell yourself short.
When you look at “giving” this way, you’ll see that you have more to give (and more opportunities to give) than you ever thought possible.
Which translates to more abundance (and less scarcity) than you believed you had.
If you found this article helpful in any way, please share it. Thanks for reading.