Today’s post is all about the mindset changes you can make today in order to jump start your actions toward generating wealth. There is no need to dive directly into wealth producing actions if the mindset is not built to sustain and continue building wealth. According to Money.com 70% of wealthy families lose their wealth by the second generation, and 90% do by the following generation.
One reason this happens is the next generation may not be equipped to manage the money they inherit. Additionally a family’s wealth can be diluted as it is divided among children, especially if each has a different mindset on how to invest or manage the family finances.
In order to see wealth sustained throughout multiple generations, the correct mindset must be ingrained and taught to the next generation. Let’s jump in!
1. Remove Negative Language Register
Just because you have not currently acquired wealth does not mean you will not have it in the future. It is vital that your language and speech match were you are going versus where you have been or currently are.
“I’m in debt up to my eyeballs”
“I’ll be in debt forever”
“I’m always going to have a car payment”
“I never have extra money”
“I’m always broke”
Statements such as these are language tools used by people with a poverty mindset. What is focused and spoken of typically become reality. Changing your language tool changes your actions which changes your life.
2. Change Your Associates & Environment
You may not need to ditch your current group of friends but association brings about assimilation. Wealthy people associate with other wealthy people. I can tell pretty early in a conversation if someone is seeking or producing wealth vs looking like wealth simply from what topics they engage in as their language is geared toward travel, business, investments, and hobbies. They also 100% of the time consult their financial decisions with a CPA.
A quick way to determine if someone is seeking or producing wealth ask “Who is your CPA?”
3. Begin Thinking Wealthy
If you want to master the beginning stages of wealth accumulation, you must determine in your mind that you are willing to take the actions necessary to become wealthy. This may mean sacrificing a lifestyle now to live another lifestyle later (or even your children’s children lifestyle). Dave Ramsey says it best “Live like no one else, so later you can live like no one else."
Once you begin thinking wealthy you will start making the changes needed to free up extra cash flow in your budget to allocate toward wealth production.
4. Embrace Delayed Gratification
The wealthy understand that they may not see immediate fruit of their sacrifice, diligence and financial strategies. Delayed gratification not only keeps you out of debt but allows you to save more money. Just because you can afford something on paper doesn’t mean it’s the best use of your money or that you actually can afford it.
Embracing the delay of purchasing luxury items is key to financial health and wealth building because you can allocate the extra funds left over in your budget to things that actually produce wealth and not take away from it.
5. Read, Read and Read
Wealthy people understand that you must be a lifetime learner and have established habits of reading. Whether audio or physical, reading should become apart of your life routine. Bill Gates and Warren Buffet are both known to read at least 1 book per week.
Once the mind focuses toward wealth accumulation, changes can not only be made but sustained. The next post will end our series on generational wealth with the financial changes you can take now costing less than $10.