Here goes that overused question again: Is the glass half full? Or half empty?
In this case, the answer reflects much of the difference between the mindset of those who are financially free and the financially “unfree,” or constricted. By financially free, we mean those people who know they can easily generate (or have already generated) enough income to cover their expenses to support their lifestyle without actively working.
Where the financially free see opportunities and potential growth, the unfree see obstacles and possible loss. Where the free see rewards, the unfree see risks.
Where the free say, “This will work,” the unfree say, “This won’t work.” (And those in the middle say, “I hope this works.”)
So where do you think you stand?
To see the difference between the one mindset and the other, we need to look at three separate characteristics: basic attitude, level of risk taking and propensity to act. So let’s look at those three in more detail.
People who are financially free are those who take responsibility for their actions … and their results. They take credit when things go right, but blame no one else when things go wrong. Nor do they dwell on a failure, except for the time needed to figure out the lesson to be learned.
They fully expect to succeed, yet are ready to pick themselves up and brush off their shins when they don’t. From there, after a quick but sound assessment, they either do a course correction and continue on or determine that their efforts and resources are better applied elsewhere.
The belief systems of those who with a financially free mindset aren’t all identical, whether their courage comes from belief in themselves, in universal energies or in a higher power is of little consequence. What counts is that they have an inherent belief that what they undertake is destined to succeed.
The financially unfree, on the other hand, generally expect to fail. More reactive than proactive, they tend to believe that they are at the mercy of outside forces … a belief that gives them someone else to blame when their expectation to fail becomes a self-fulfilling prophecy.
By focusing more on all the potential obstacles than anything else, they react to any hiccup as a disaster, being certain that it’s an indication that they were right in the first place: they should never have gone forward with whatever they’ve undertaken.
Level of Risk Taking
As for risk, the risk profile of the financially free is high, partly thanks to their level of confidence. Having succeeded in the past, they know they can succeed again. Even if they succeeded at something small, with lesser risk, growing the risk feels natural because they see it as a continuum that leads to greater and greater success. (Yes, success breeds success.)
By taking risks, their intention is certainly not to fail. The risks they do take are “educated” risks, well researched and based on facts. They define what they need to know in order to be comfortable making a go/no-go decision … and then they make it.
The financially unfree are less likely to take risks, preferring instead to drag the decision-making process out as they dig for more and more information. Out of fear of failure, they reach a form of paralysis, or “analysis paralysis.” And by the time they finally feel they have researched things to death and do take action, any opportunity that did exist is likely long gone.
Propensity to Act
The financially free are real clear on one thing: in order to succeed, you have to take some form of action. You invest in something, you build something, you launch something … you do something! (The expression “nothing ventured, nothing gained” was probably first uttered by an unfettered entrepreneur!)
As self-made multimillionaire and bestselling author Michael Masterson insists in his book “Ready, Fire, Aim,” you do need some form of plan and preparation to avoid certain failure. However, after that, rather than perfect the plan ad nauseum, he advocates taking action, perfecting the plan as you move forward.
By getting into action, you’re getting hands-on, in-the-trenches knowledge and are no longer working in the theoretical. As you progress, things unfold. And by being an action taker (and a natural course corrector), your chances of fulfilling your expectations of success are multiplied immeasurably.
(By the way, according to Brian Tracy, an airplane trying to fly from Point A to Point B is off course 99 percent of the time, and is constantly course correcting. So why can’t you?)
As for people who are still financially unfree, by hesitating to take action until every possible outcome has been analyzed and every risk has been minimized, they’ll find they never get out of the starting gate. By not acting, they may not lose … but they’ll certainly never win.
Turning Unfree Into Free
So if any of the descriptions of the “financially unfree” mindset sound familiar, how can you change your outcomes? Here’s one way:
- Identify a small project or business activity that’s just slightly outside your comfort zone and that has a risk level that’s greater than you’d usually take, but not paralyzing.
- If you’ve been thinking about doing it for some time, forget about whatever you felt you needed before beginning.
- Define your ideal final outcome.
- Make a list of all the steps you would need to take to get there. Print out the list.
- If you look at the later steps in the process, they’re likely the ones that are the most difficult and most fear-inducing. So start reading the steps from the beginning and determine where you start feeling a little queasy.
- Fold the paper right above the step that makes you uncomfortable.
- Post the steps where you can see them (with the paper still folded).
- Stay focused on how good it will feel to reach your ultimate goal and complete the steps you can see.
- Once those are completed, look at the rest of the list. You’ll be surprised at how nonthreatening they now look, since your mindset has shifted with your success up to now.
- Complete the project.
Now you’re ready to take on larger and larger projects, and those with greater and greater risk. As you know, with risk comes reward. Congratulations, you’re on your path towards becoming financially free!
Be sure to let me know in the comment section below where on the “unfree to free” continuum your mindset is, and what you’re willing to do to change it.