Financial freedom with a wealth mindset is why we believe in, and are a part of, the F.I.R.E. movement (Financial Independence Early Retirement). You can achieve financial freedom with a positive wealth mindset combined with financial discipline.
How can you begin to get ahead if you don’t believe it’s possible or important? Why should you even try to save and invest money if you can not understand the bigger picture?
Incremental changes to your financial discipline add up and can snowball into eventual financial freedom. This can be done even if it seems like it’s impossible initially. You just have to be inspired to have a wealth mindset to give yourself the confidence to move forward with baby steps or micro-actions.
You can climb out of debt with a plan and action.
You can manifest wealth by making decisions based on risk, optimization, and growing net worth.
You can become financially independent if it is your will.
You can retire early if you save aggressively and invest passively. The earlier in life you realize this, the easier it will be to become financially independent and free.
Wealth Building Mindset
Wealthy people are ultra aware of their wealth and cultivate it throughout their lifetime. They are financially woke to the face that if they spend more then they save, they will not remain wealthy and eventually will go broke. Their finances are cultivated to be set up so that they are generating more cashflow than spending it, which is why they remain wealthy and their net worth grows every day.
A person without financial awareness will likely spend every dollar they make on depreciable assets because to them, money is just a ticket to get stuff, pay for lifestyle, and have fun.
Most people can not stand having money in the bank, and are always looking to trade those savings in for more toys and fun to fill whatever void is in their life.
Impulse spending and status spending will drain the accounts of those that do not have the wealth building mindset, but instead, have a wealth buying mindset.
100k Rich vs 100k Poor
Let’s say you bring in 100k per year, but you spend it all. How much wealth do you have? Well, your junk is worth something but not as much as if it were investments and cash in your hand instead. You might think you are wealthy based on your toys and lifestyle, and that is fine.
But are you setting yourself up for later when you don’t have that income? Are you trying to replace that income with passive income from investments and businesses?
Let’s now say you bring in 100k per year, but you save half. Well, now we are talking. This is the wealth mindset. Money in the bank is wealth.
Let’s say that 50k can generate a very conservative 3%. That’s $1,500 generated without lifting a finger. Your money is working for you. Let that compound and keep saving and you will one day have financial freedom.
Develop Wealth Building Habits with Micro-actions
Millionaires develop a system of financial habits that are part of their awareness, which is in large part why they become richer.
They are woke. They work hard an smart to retain their wealth and keep the cashflow moving towards wealth, and not away from wealth.
Wealthy people cultivate their wealth by maintaining and growing their capital by using different financial strategies such as investing, saving, tax avoidance, building businesses, etc.
Practice the Art of Not Letting Your Money Go
This world is designed to take your money. Companies, doctors, landlords, retail stores, grocery stores, utilities, taxes all want to charge you as much as they can to use their services or buy their products. They want to charge just a little more than you can afford so they can squeeze every dime into their pockets.
A Cashflow Cultivator spends money very carefully with thoughtful consideration of the financial impact on their net worth. They know that their money is their employee, effectively recruiting more money to join their net worth army which in turn will go and recruit more cash. This process is 24/7.
When you spend money, you are cutting down on your workforce and are not able to generate as much money as previously. Let your money work for you. Your cash cannot work for you if it’s in someone else’s pocket.
How the Wealth Building Mindset is Beneficial for Cultivating Your Net Worth
Take action because you believe it’s possible to build your wealth. If you can not see the larger goal, you will keep treading financial water and live paycheck to paycheck.
Compound your savings and investing in a long-term financial portfolio model.
Understand that saving money is actually making money by retaining your cash for investments.
Understand that anything that is not necessary is junk and could be sold and turned to cash to be used in investments. You don’t have to sell all of your possessions, just understand that money is more important than unnecessary junk.
Have the incentive to explore and open new passive income streams or businesses to diversify your income.
Wealth Building Mindset Personal Story
I have always saved and was very frugal with my spending. As my net worth grew, so did the desire to build it into something that would one day allow my family to become financially independent so that we could become free to exist with our own businesses and investments.
Wealth Building Mindset Micro-action
Put thought and research into how you can take the wealth building mindset and incorporate it into your financial philosophies and use it to manifest the financial freedom you seek. Join our community as we work together to help each other move forward by providing positive and actionable ideas and encouragement.
Wealth Building Mindset Risk Assessment
To build wealth, you must study and understand risk. For example, instead of putting all of your money into 1 stock or 1 index fund, diversify that amount over 20 different types of investments to mitigate your risk in case 1 or more of those investments underperform, you still have the other investments working for you. Never put all of your eggs in one basket. Always diversify.
Wealth Building Mindset Disclaimer
Cultivate Cashflow presents concepts and explores ideas for you to further research and ultimately after doing your own due diligence, decide if it is right for yourself.
Cultivate Cashflow is not a financial advisor or advisory firm. We are an education and lifestyle blog who document our own financial and business practices as teaching and entertainment content.
This page may contain some affiliate links that generate commissions, but the recommended websites and tools listed on any page in this website are there because I have used them in the past or I am currently using them and have experience with the product.
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