You’d be hard-pressed to find a business owner who hasn’t experienced some fear and anxiety about the future of their business in the past year (myself included!). However, having a persistently negative money mindset can be harmful to your business, while having a positive mindset can help you weather even the most difficult times. To understand how your money mindset affects your business, you first need to examine what your mindset is.
Money mindset is the set of beliefs and attitudes one has towards finance and money. Our mindsets are influenced by our past experiences with money and are linked to our emotions. Understanding your beliefs about money will help you see areas where they may be affecting your business and help you improve your mindset to make better decisions going forward.
A negative money mindset focuses on scarcity and can lead to procrastination, fear, and feeling out of control. It can result in uncontrolled spending and excessive debt. It can also prevent business owners from taking advantage of new opportunities when they come along. If the negative behaviors persist, they can interfere with a business’s ability to flourish and may even cause failure. Some negative money mindset behaviors in business include: excessive discounting or underpricing your products and services, trying to be all things to all people, and reacting to circumstances instead of proactively managing the business. Not only do these behaviors rob the business of precious resources, it also robs business owners of the energy and drive needed to sustain the business.
On the other hand, a business owner with a positive mindset is adaptable, optimistic, seeks new opportunities and is willing to ask for help. They understand the challenges facing their business and proactively seek solutions. They invest in their business wisely, don’t take unnecessary risks and actively plan for the future. Some examples of positive money mindset behaviors in business include: valuing your time as well as your products and services, saying no to opportunities that do not support your mission and values, and surrounding yourself with other positive people who support and encourage you and your business.
To understand your money mindset, start by taking one minute to write down all of your beliefs about money. Be honest with yourself and don’t pass judgment on your thoughts. Just write it all down. Then take a look at your beliefs - do you have mostly positive beliefs or negative beliefs? Do you have conflicting beliefs? Can you see areas where your money beliefs have helped or hindered your business in the past?
Most of us have a mixture of both positive and negative money beliefs. Once you understand your particular money mindset, you can work to build on the positive beliefs and turn around the negative ones. This requires a willingness to make changes and some patience to see the results. Even small changes can bring big benefits, however, so make it a priority to start working on your money mindset today!