“Being wealthy is a choice.”
The first time I read this was in a Robert Kiyosaki book.
I don’t actually remember which book that was, but I do remember my reaction to that statement: “That can’t be true. It’s not that simple. You can’t just choose.” That’s what I thought to myself.
Years later, I’ve discovered that Kiyosaki was right and I was wrong. Being wealthy is indeed a choice.
Remarkably, I learned that it begins with something as simple as the thoughts that you put into your head. Those thoughts are reflected in the vocabulary that you choose to employ.
Thoughts become words. Words become actions. Actions become patterns. Patterns become you.
Because words are a pivot point between thoughts and actions, the words that you use can have a surprisingly profound impact on obtaining wealth.
Below is a list of what I consider a “scarcity mindset” phrase, followed with an “abundance mindset” phrase. If you use a scarce vocabulary, it will be nearly impossible for you to obtain real wealth.
Let’s run a little check on your lexicon. Which of these are you most likely to say or think to yourself?
Scarcity: “I want to be debt-free.”
Abundance: “I want to be financially-free.”
No one shrinks their way to wealth. Who got rich by retiring their mortgage or paying off their car? No one. Ever. One acquires wealth by building many durable passive income streams. In fact, one often embraces “good debt” in order to do this.
Scarcity: “Live below your means.”
Abundance: “Expand your means.”
The entire point of acquiring wealth is to live well and give well. Rather than letting your Groupon app dictate where you eat dinner again, read about doing a 1031 Tax-Deferred Exchange or attend a real estate investing seminar. Secure some big investment wins, then plan an unforgettable vacation to Europe! Focus on production, not reduction.
Scarcity: “I must work hard.” or even, “I must make my money work harder than me.”
Abundance: “I must make other people’s money work hard for me.”
It can be a stunning revelation for you to learn that getting your money to work for you will not create wealth. Ethically employ the money of others – tenants, the government, and the bank – and now you have the ingredients for wealth creation (see #4)!
Scarcity: “Compound Interest is magical.”
Abundance: “Leverage is magical.”
At any reasonable rate of return, compound interest only has a chance at providing an “adequate” retirement for you when you’re older – and never wealth. Leveraging the use of other people’s money means you achieve your ROI from their capital, not yours.
Scarcity: “Let’s build a Budget and stick to it.”
Abundance: “Let’s make a Cash Flow Statement!”
“Budget” implies frugality, scrimping, saving, and cutting back. You can only cut so much to the downside, plus you’re living worse anyway. That degraded quality of life is time that you’ll never replenish. Instead, build multiple income streams and increase your passive cash flow. Your income potential is unlimited.
Scarcity versus abundance begin with your thoughts and words. C’mon now. Which life do you really want to design for yourself – one of scarcity or one of abundance? Like I once read in a Kiyosaki book, you actually have a choice.
A rich man digs for gold, while a poor man is concerned with the cost of a shovel.
Here’s to your education and success!
Thought getting your money to work for you creates wealth? It doesn’t! That’s a myth. My international best-selling E-book is now 100% free, 7 Money Myths That Are Killing Your Wealth Potential. Get it here for a limited time.
What an irresponsible and childish perspective.
Thanks for initiating the conversation.
Can you provide some rationale?
Thanks, Keith Weinhold
I’d love to hear the rationale as well. So many different perspectives on this topic.
I love your material, and think you’re very gifted at simplifying ideas into easily understandable chunks of information. I spent years feeling guilty around my Ramsey minded friends, knowing I was just incapable of being debt free or living an austere existence. I just knew there was something “off” about that mentality, but couldn’t put it into words. You do a great job of quickly debunking the scarcity mindset!
Luckily, most of my debt was real estate debt, and now I don’t have a “real” job anymore…I just collect a nice income from my real estate, and have time to enjoy my kiddos! I’m headed to Panama next week to check out opportunities there. Wish I could have scheduled it around one of your coffee tours! Maybe next time…
Thanks for all the great information. Keep it coming!
I appreciate your perspective on wealth. It is refreshing to follow someone who is not afraid of doing the opposite of what appears to be easy and “fashionable” Easy now leads to hard for the rest of one’s life.
Time to change my thinking. Absolute great advice. Thank you.
“Choose to be Rich” was the name of a CD and video course by Kiyosaki
Thanks for helping us keep our head on straight!
Think and Grow Rich! Mindset definitely matters. Thanks Keith for thought provoking podcasts and articles.
Thank you so much for listening and reading the articles! Best of luck with your investment goals in 2021.