11 Money Mistakes You Don’t Know You’re Making

Think you’re doing everything right with your money but still not seeing results? Here’s 11 non-obvious money mistakes most people make but nobody talks about.

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11 Money Mistakes You Don’t Know You’re Making

MONEY MINDSET

The Money Rules Nobody Talks About

Like most people, you probably did not learn about money growing up. We think once we get a good job, we will have it all figured out. We save money, we have a budget… But there is much more to it.

If you take all the ‘right’ steps to being better with money and wondering why you are not seeing the results you want, chances are you might be making a few money mistakes you aren’t even aware of.

I’m gonna let you in on the most common money mistakes most people make (but nobody talks about) but which are critical for having more money. 

#1 Thinking It Is Just About the Numbers

Unlike common belief, your finances are not just facts and figures. Money is more than just tactics.

Don’t get me wrong: You should absolutely know your numbers. The first step to getting your finances sorted is having a clear picture of what your current financial situation is

Determine your net worth, i.e. what you owe vs. what you own. If you’re in debt, find out how much exactly you owe, your interest rates, how much savings you have, your income vs. expenses. 

But what most people don’t know, is that getting the results you want does not start on paper, but in your head. Our beliefs create our results. 

Personal finance is, in fact, personal. And you probably have some emotional baggage that comes with your own money story. Money is a very emotional topic which nobody talks about. 

You have to become aware of your emotions related to money. If you have feelings of shame, guilt, overwhelm, fear or any other negative emotion, it is very likely you will avoid dealing with your money, escape into retail therapy or sabotage your money goals and results in many other ways. 

A good place to start is keeping a money journal. And I don’t mean just tracking your expenses.

Write down all your thoughts and feelings about money. Get emotional! Make it a daily practice to jot down everything you think and feel about money. How spending money makes you feel, what you enjoy, how you feel about your debt or savings.

Keeping a money diary was an absolute game-changer for me. You will get awareness of all your patterns, behaviours, what causes you stress, what triggers you to overspend and what your common money beliefs are.

#2 Not Working on Your Money Mindset 

Our lives are loaded with negative beliefs around money. You hear it everywhere. On the street, in the media, at family gatherings. Most money conversations are uncomfortable and the majority of news are based on fear and scarcity. It is so engrained in our society and everyday lives, that we don’t even notice it. You need to identify these limiting beliefs in order to change them.

Most people don’t even realize that their results with money have anything to do with their mindset. They think this is all lofty woo-woo. They think it is just about taking the right actions.

However, changing my mindset around money has been the most profound and critical factor in my journey to financial success. 

Money mindset is not taught at school. Nobody taught us that our energy matters and how we think and feel about things is the most important thing in the long run. We ignore the emotional part of money because we think we should be purely rational when it comes to money. But it is in fact our thoughts and emotions that determine if we succeed or not. If you can manage your thoughts and feelings well, you can manage your money well.

You can fight and hustle your way to your goals, but it will be much harder because you will be facing so much inner resistance.

Mindset work will help you shift your focus of attention, so you can manage the drama in your head that stops you from achieving any goal.

#3 Not Having Financial Goals 

When I talk to people about their financial goals, the most common answer is “I want/need/wish for more money”. They want to make more money, have more money, spend more money. Or be “comfortable”.

But what does that even mean?!

People save just to save. They don’t have a clear vision of their life or what financial success even means to them. 

You should be very specific about what your goals are and you need a very good reason (= a strong WHY), or you won’t stick to your plan. 

You need long-term and short-term goals. They have to be specific and measurable. How else will you know if you achieved your goal or not? 

Examples: 

  • “I will have 10k saved by December 31, 2020.”
  • “I will put 10% of my net income towards retirement every month for the next 12 months.”
  • “I will have 8000 of credit card debt paid off by July 1st, 2020. 

Only (and only) when you have specific, measurable financial goals you can work backwards from there and take the right actions to achieve them.

Once you know your big goal, you can chunk it up in smaller, monthly, weekly goals. You will know exactly what to do and avoid overwhelm and frustration. When you have a clear vision, you can get down to the math and it becomes easy: 

Example: 

Save 900 in 12 months: 

-> 900/12 = 75 per month 

-> 75/4 = 18.75 per week 

-> 18.75/7 = 2.68 per day

Finding ways to cut less than $3 out of your budget will become easy, attainable and measurable. It is so much easier to stick to a plan once your actions and numbers are crystal clear. 

#4 Thinking You’re Just Not Good With Money

“I’m just not a money person.”

“I’m not good with money.”

“I don’t understand this whole finance stuff.”

Any of those sound familiar?

Nobody was born being a money genius. Financial literacy and habits are learned and acquired over time. 

Read books, expand your knowledge. Don’t be discouraged if you don’t understand the vocabulary at first.

Nobody in my family or school taught me about investing in the stock market. I did my research, educated myself and just grew my portfolio slowly from there. 

We all start somewhere. 

Being ‘good with money’ isn’t rocket science and you don’t need a finance degree or have friend on Wall Street. You just need to understand the rules of the game. It is not about intelligence, but literacy and behaviour. 

My Resource Library is a great place to start. Or check out my latest post on the Best Books on Money to read this year. 

#5 Thinking Money Is Just the Cash 

Your money is not just the money in the bank, how much you spend and save from your paycheck. Money is also about investments, retirement and insurance. It includes all financial aspects of your life.

Consider everything that might be relevant for your future financial situation. Where you live and who you marry (sorry for the honesty) also will determine how your financial future will look like. Divorce, death and legal issues come with (often severe) financial ramifications. We cannot predict the future, so make sure you are prepared for these by having a solid plan in place. 

Learn about retirement funds, insurance, taxes and fees. E.g. you might be surprised that the kind of retirement account has an impact on taxation, hence your future cashflow. It is great setting aside money for the future, but you should also know what happens with it once you get there and need to access it.

#6 How You Talk About Money

People underestimate the power of their words when it comes to money. I hear people ‘dirt-talk’ their money saying things like:

  • “I can’t afford that.”
  • “The rich get richer and the poor get poorer.”
  • “People like us can’t do…” 
  • “I only earn…”
  • “If only I won the lottery”
  • “These rich people…”
  • “I don’t have enough money to…”
  • “I’m broke.”
  • “No matter what I do, I don’t get anywhere”

This, again, is closely related to negative money beliefs and mindset. When you think you are just a small fish in the pond and you can never make it or you need ‘luck’ or a big inheritance to build wealth, you will struggle forever.

If you realize it or not, your words have power. I am shocked sometimes how people talk about their money. I watch closely how I speak of my money and don’t badmouth people who have money. I treat my money like it’s my friend. I don’t talk shit about my them behind their back but expect them to have my back.

Most people don’t realize that because they think money is just money and that it doesn’t matter. Whatever you say, you confirm as your reality. And whatever we focus on, we get more of. 

So pay intention what you say about money, even if it’s just small talk.

#7 Underestimating How Much You Can Make

People feel stuck at their jobs because they have bills to pay and loans to pay off. When you feel stuck, it’s because you think you are stuck. I remember feeling stuck many times.

Truth is: But we always have a choice. We have options. We live in an amazing era where there is unlimited access to information, you can change jobs, learn new things, make more money, start a side hustle. The barriers of entry for new businesses have never been lower.

You can always make more money. There is no such thing as a fixed or limited income. You can make a ton of money with low or no education, or a crappy salary with the best education. We all have something to offer. We just never tap into our dormant potential.

Stop limiting yourself to your status quo. Just because you have never done it before, does not mean it is not possible. It is not always easy, but it is possible.

#8 Overestimating How Much Money You Really Need 

Most people think they need to become multi-millionaires to live the good life. They don’t even know how much their dreams actually cost and that, most often, it is more affordable (and attainable) than they think. 

Here’s a fun exercise for you: Sit down and estimate what your ideal life would cost. 

Write down living in your dream home, car(s), dining out every night (or having a private chef), money for pleasures like clothes, entertainment, everything. Just make an educated guess. Get very specific and look at housing prices in the area you would like to live etc. 

And here’s the math again: Add everything. divide it by the years you think you’ll live and then divide that by 12. So how much money do you need per month to live that lifestyle? 

That’s your so-called freedom sum. 

When I did that exercise the first time, I was very surprised how ‘low’ that number was. 

When you think something is possible, you can take the right steps in that direction.

Overestimating how much you need also applies to ‘stuff’. We think we need a closet of 300 pairs of shoes to feel rich. Over the years, I have become more of a minimalist and try to find my sweet spot of just the right amount of physical possessions I really need to have a fulfilled life. 

#9 Not Deciding to Become Rich

Would you tell people you would like to be rich? Probably not.

Most of us have never decided to be rich. I knew I wanted to have money when I realized how much it sucked to not have money.

Being broke is a choice. So is being rich.

It is okay to want to have money and building a better life for yourself. It is not selfish or unethical. It does not make you a bad person to want money just to have money.

#10 Not Caring About Your Money

If you have any financial aspirations (otherwise you probably wouldn’t read this blog), you need to take care of your money, both physically and spiritually/mentally.

People don’t pay any attention to their money and expect it to work. Or they think money management is just pay the bills and die. Some resist spending time and energy on their money, because they think it is shallow, inappropriate, and greedy to think about money. (Another negative belief btw.)

Money doesn’t have to be complicated and you mustn’t to obsess about it. But you need to spend time with it and treat it right. 

Start with making a budget, tracking your expenses and educating yourself. Awareness and attention are the key to improving your results with money. Where attention goes, energy flows.

Take care of your money, and your money will take care of you.

#11 Not Loving Your Money

Yes, you can love you money!

Money is not a person but you should treat it like one. Your relationship with money is very very important.

You can have money and be happy to have money. You don’t even need to justify it.

Love your money, treat it well, speak kindly about it, give it attention, spend quality time with it. Like you would with a real person.

There you have it – The list of the most common (and not talked about) money mistakes I hope you can avoid!

Have you been educated on money growing up? What is your money story? How do you take care of your finances?

xoxo, Evelyn

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The Money Rules Nobody Talks About

Like most people, you probably did not learn about money growing up. We think once we get a good job, we will have it all figured out. We save money, we have a budget… But there is much more to it.

If you take all the ‘right’ steps to being better with money and wondering why you are not seeing the results you want, chances are you might be making a few money mistakes you aren’t even aware of.

I’m gonna let you in on the most common money mistakes most people make (but nobody talks about) but which are critical for having more money. 

#1 Thinking It Is Just About the Numbers

Unlike common belief, your finances are not just facts and figures. Money is more than just tactics.

Don’t get me wrong: You should absolutely know your numbers. The first step to getting your finances sorted is having a clear picture of what your current financial situation is

Determine your net worth, i.e. what you owe vs. what you own. If you’re in debt, find out how much exactly you owe, your interest rates, how much savings you have, your income vs. expenses. 

But what most people don’t know, is that getting the results you want does not start on paper, but in your head. Our beliefs create our results. 

Personal finance is, in fact, personal. And you probably have some emotional baggage that comes with your own money story. Money is a very emotional topic which nobody talks about. 

You have to become aware of your emotions related to money. If you have feelings of shame, guilt, overwhelm, fear or any other negative emotion, it is very likely you will avoid dealing with your money, escape into retail therapy or sabotage your money goals and results in many other ways. 

A good place to start is keeping a money journal. And I don’t mean just tracking your expenses.

Write down all your thoughts and feelings about money. Get emotional! Make it a daily practice to jot down everything you think and feel about money. How spending money makes you feel, what you enjoy, how you feel about your debt or savings.

Keeping a money diary was an absolute game-changer for me. You will get awareness of all your patterns, behaviours, what causes you stress, what triggers you to overspend and what your common money beliefs are.

#2 Not Working on Your Money Mindset 

Our lives are loaded with negative beliefs around money. You hear it everywhere. On the street, in the media, at family gatherings. Most money conversations are uncomfortable and the majority of news are based on fear and scarcity. It is so engrained in our society and everyday lives, that we don’t even notice it. You need to identify these limiting beliefs in order to change them.

Most people don’t even realize that their results with money have anything to do with their mindset. They think this is all lofty woo-woo. They think it is just about taking the right actions.

However, changing my mindset around money has been the most profound and critical factor in my journey to financial success. 

Money mindset is not taught at school. Nobody taught us that our energy matters and how we think and feel about things is the most important thing in the long run. We ignore the emotional part of money because we think we should be purely rational when it comes to money. But it is in fact our thoughts and emotions that determine if we succeed or not. If you can manage your thoughts and feelings well, you can manage your money well.

You can fight and hustle your way to your goals, but it will be much harder because you will be facing so much inner resistance.

Mindset work will help you shift your focus of attention, so you can manage the drama in your head that stops you from achieving any goal.

#3 Not Having Financial Goals 

When I talk to people about their financial goals, the most common answer is “I want/need/wish for more money”. They want to make more money, have more money, spend more money. Or be “comfortable”.

But what does that even mean?!

People save just to save. They don’t have a clear vision of their life or what financial success even means to them. 

You should be very specific about what your goals are and you need a very good reason (= a strong WHY), or you won’t stick to your plan. 

You need long-term and short-term goals. They have to be specific and measurable. How else will you know if you achieved your goal or not? 

Examples: 

  • “I will have 10k saved by December 31, 2020.”
  • “I will put 10% of my net income towards retirement every month for the next 12 months.”
  • “I will have 8000 of credit card debt paid off by July 1st, 2020. 

Only (and only) when you have specific, measurable financial goals you can work backwards from there and take the right actions to achieve them.

Once you know your big goal, you can chunk it up in smaller, monthly, weekly goals. You will know exactly what to do and avoid overwhelm and frustration. When you have a clear vision, you can get down to the math and it becomes easy: 

Example: 

Save 900 in 12 months: 

-> 900/12 = 75 per month 

-> 75/4 = 18.75 per week 

-> 18.75/7 = 2.68 per day

Finding ways to cut less than $3 out of your budget will become easy, attainable and measurable. It is so much easier to stick to a plan once your actions and numbers are crystal clear. 

#4 Thinking You’re Just Not Good With Money

“I’m just not a money person.”

“I’m not good with money.”

“I don’t understand this whole finance stuff.”

Any of those sound familiar?

Nobody was born being a money genius. Financial literacy and habits are learned and acquired over time. 

Read books, expand your knowledge. Don’t be discouraged if you don’t understand the vocabulary at first.

Nobody in my family or school taught me about investing in the stock market. I did my research, educated myself and just grew my portfolio slowly from there. 

We all start somewhere. 

Being ‘good with money’ isn’t rocket science and you don’t need a finance degree or have friend on Wall Street. You just need to understand the rules of the game. It is not about intelligence, but literacy and behaviour. 

My Resource Library is a great place to start. Or check out my latest post on the Best Books on Money to read this year. 

#5 Thinking Money Is Just the Cash 

Your money is not just the money in the bank, how much you spend and save from your paycheck. Money is also about investments, retirement and insurance. It includes all financial aspects of your life.

Consider everything that might be relevant for your future financial situation. Where you live and who you marry (sorry for the honesty) also will determine how your financial future will look like. Divorce, death and legal issues come with (often severe) financial ramifications. We cannot predict the future, so make sure you are prepared for these by having a solid plan in place. 

Learn about retirement funds, insurance, taxes and fees. E.g. you might be surprised that the kind of retirement account has an impact on taxation, hence your future cashflow. It is great setting aside money for the future, but you should also know what happens with it once you get there and need to access it.

#6 How You Talk About Money

People underestimate the power of their words when it comes to money. I hear people ‘dirt-talk’ their money saying things like:

  • “I can’t afford that.”
  • “The rich get richer and the poor get poorer.”
  • “People like us can’t do…” 
  • “I only earn…”
  • “If only I won the lottery”
  • “These rich people…”
  • “I don’t have enough money to…”
  • “I’m broke.”
  • “No matter what I do, I don’t get anywhere”

This, again, is closely related to negative money beliefs and mindset. When you think you are just a small fish in the pond and you can never make it or you need ‘luck’ or a big inheritance to build wealth, you will struggle forever.

If you realize it or not, your words have power. I am shocked sometimes how people talk about their money. I watch closely how I speak of my money and don’t badmouth people who have money. I treat my money like it’s my friend. I don’t talk shit about my them behind their back but expect them to have my back.

Most people don’t realize that because they think money is just money and that it doesn’t matter. Whatever you say, you confirm as your reality. And whatever we focus on, we get more of. 

So pay intention what you say about money, even if it’s just small talk.

#7 Underestimating How Much You Can Make

People feel stuck at their jobs because they have bills to pay and loans to pay off. When you feel stuck, it’s because you think you are stuck. I remember feeling stuck many times.

Truth is: But we always have a choice. We have options. We live in an amazing era where there is unlimited access to information, you can change jobs, learn new things, make more money, start a side hustle. The barriers of entry for new businesses have never been lower.

You can always make more money. There is no such thing as a fixed or limited income. You can make a ton of money with low or no education, or a crappy salary with the best education. We all have something to offer. We just never tap into our dormant potential.

Stop limiting yourself to your status quo. Just because you have never done it before, does not mean it is not possible. It is not always easy, but it is possible.

#8 Overestimating How Much Money You Really Need 

Most people think they need to become multi-millionaires to live the good life. They don’t even know how much their dreams actually cost and that, most often, it is more affordable (and attainable) than they think. 

Here’s a fun exercise for you: Sit down and estimate what your ideal life would cost. 

Write down living in your dream home, car(s), dining out every night (or having a private chef), money for pleasures like clothes, entertainment, everything. Just make an educated guess. Get very specific and look at housing prices in the area you would like to live etc. 

And here’s the math again: Add everything. divide it by the years you think you’ll live and then divide that by 12. So how much money do you need per month to live that lifestyle? 

That’s your so-called freedom sum. 

When I did that exercise the first time, I was very surprised how ‘low’ that number was. 

When you think something is possible, you can take the right steps in that direction.

Overestimating how much you need also applies to ‘stuff’. We think we need a closet of 300 pairs of shoes to feel rich. Over the years, I have become more of a minimalist and try to find my sweet spot of just the right amount of physical possessions I really need to have a fulfilled life. 

#9 Not Deciding to Become Rich

Would you tell people you would like to be rich? Probably not.

Most of us have never decided to be rich. I knew I wanted to have money when I realized how much it sucked to not have money.

Being broke is a choice. So is being rich.

It is okay to want to have money and building a better life for yourself. It is not selfish or unethical. It does not make you a bad person to want money just to have money.

#10 Not Caring About Your Money

If you have any financial aspirations (otherwise you probably wouldn’t read this blog), you need to take care of your money, both physically and spiritually/mentally.

People don’t pay any attention to their money and expect it to work. Or they think money management is just pay the bills and die. Some resist spending time and energy on their money, because they think it is shallow, inappropriate, and greedy to think about money. (Another negative belief btw.)

Money doesn’t have to be complicated and you mustn’t to obsess about it. But you need to spend time with it and treat it right. 

Start with making a budget, tracking your expenses and educating yourself. Awareness and attention are the key to improving your results with money. Where attention goes, energy flows.

Take care of your money, and your money will take care of you.

#11 Not Loving Your Money

Yes, you can love you money!

Money is not a person but you should treat it like one. Your relationship with money is very very important.

You can have money and be happy to have money. You don’t even need to justify it.

Love your money, treat it well, speak kindly about it, give it attention, spend quality time with it. Like you would with a real person.

There you have it – The list of the most common (and not talked about) money mistakes I hope you can avoid!

Have you been educated on money growing up? What is your money story? How do you take care of your finances?

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11 Money Mistakes You Don’t Know You’re Making

MONEY MINDSET

January 27, 2020