There is a significant difference between how a rich mindset thinks about a big purchase versus other people. They use a completely different mindset when they approach a big purchase and that’s one of the reasons they are rich and most likely always will be!
Why not just learn from them!?!
Let’s use the example of buying a summer house (the big purchase). Regardless of which situation and mindset you are in, we all dream about a summer house from time to time. I generally don’t like to use the word “dreaming” but in this context it seems accurate to most. The main difference is of course that some make it their reality whilst others don’t. Let’s assume we have found the the ideal summer house in an area where we would like it to be. Unfortunately it comes with a price tag…
Regardless of which mindset you currently have and your circumstances, let’s say you recon you would be able to use it a couple of weeks per year and a handful of weekends (depending on the vicinity to your main home as well as your work situation etc).
Different minds (mindsets) would approach this scenario in very different ways even though we all have the ability to choose how we think. And YES, we can all change how we think and how we react even if it might take some time.
Let’s go through the different ways people would think about this property.
1: The Poor Money Mindset
This person has an automatic negative relationship with money and finance and has most likely had it for a very long time (it’s the blue print of that person). That’s why it has become an auto-response (it doesn’t matter whether it’s true or not!).
When a Poor Money Mindset thinks about buying a summer house, the first response popping up to mind is: “I can’t afford that” or “I will never be able to buy that”.
Having nurtured these kind of responses and feelings for a very long time will unfortunately make them happen automatically. With this starting point, the person will not feel very good, nor enthusiastic about the possibilities of actually having a summer house one day.
2: The Financial Independent Mindset
This person has a different mindset and relationship to money. They have nurtured it differently and managed to become financially independent. Hence they can sustain their current lifestyle for the rest of their lives. This financial situation will of course mean that their brains are differently wired compared to the person with a poor money mindset.
When the Financial Independent Mindset thinks about buying a summer house, the first response that pops up is: “I have the money and can afford it” but with the follow-up question: “Shall I use cash (my own money) or borrow money to finance it if I decide to purchase it?”
Based on their financial intelligence and their current situation they will make a wise decision and buy the summer house if it is what they want. Financially it will not be a challenge as they have become financially independent for a reason, they understand and speak The Language of Money!
3: The Rich Money Mindset
This person is the most financially oriented and business minded of the three. They have the financial resources and could easily buy the house and they know it.
When a Rich Mindset thinks about buying a summer house, the first response or thought that pops up is: “How can I make it pay for itself or even better, generate a positive cash-flow to me and my family?”
Once this thought has appeared, their brain will automatically get to work on it and it won’t take many seconds/minutes before they have numerous solutions along the lines of:
- Using someone else’s money to finance it (bank) and use (positive) leverage for minimal outlay of own cash (if this sounds like too many financial words, that’s a hint you have to start learning this language!).
- Make it pay for itself by creating a setup to have it let out when they are not using it themselves (based on their “normal” schedule they will not be able to be there very often anyway but want to have the opportunity to enjoy it once in a while).
- Have the rental income cover all the expenses and ideally even generate a positive cash flow.
If they are very wealthy, maybe they will buy it and just not care but if you are not there yet, adopting this kind of mindset and creativity will be very beneficial and take you closer to that level!
The rich have the money to buy it but they don’t want to use their own cash unless they have to, since having access to cash gives them flexibility. Imagine if they buy the house with cash and the deal of a lifetime comes their way and they have to pass because they don’t have the money. They never want to be in that situation and by using other people’s time and money, they are leveraging the most valuable assets we have.
They know the scarcity of their time so if they can have someone else manage things for them, like taking care of the place and rent it out etc. they will have more time to work on their businesses and investments to make an even bigger difference in the world.
The difference is that they will still own that summer house they wanted but it’s hopefully not costing them anything and they can still use it when they want to whilst giving them cash-flow and possibly appreciation to their wealth, brilliant!
Why you should care?
It’s pretty simple, we all have the capacity to decide what we think and how we react which means we can all change how we think and act! The only thing we need to do is start practicing and we will eventually grow the same mindset as the rich. It really is true that practice makes perfect!
Their brains are just wired differently but that comes with the practice! Based on neuroscience and neuroplasticity we can all train our brains to work in the same way! There is no reason we could not all come up with the same ideas and solutions and then put them into action albeit starting at the level we are currently at.
By consistently working on changing your money mindset, working on your creativity and look for opportunities, it’s just a matter of time until you will make some of them your reality.
A funny side note is that since I originally wrote this post about two years ago (not published until now), we have bought a summer house! I have also shared a series of posts about how we use it privately as well as letting it out on Airbnb! So if you haven’t checked those out yet, I would suggest you do it right now as that might be the answer to how you too can buy a summer house! Check it out here: Buying a property part 1 – Why, what and where?
Actions to take:
- The Language of Money – a language for life
- How to change your money mindset!
- How to always have enough money
- How to create a winning mindset
- Habits of the successful – just copy them!
- The Power of Autosuggestion – Napoleon Hill
- Autosuggestion – We become what we think about!
Dipping your toes in to property investing via Airbnb?
- Check out our Savings section to lower your costs and increase your flexibility.