When I first decided to spend a month experimenting with slow money, my goal was simply to do a proper check-in with my finances. It had been years since I’d had any major financial goals to work towards, which I knew was only going to lead me down the road to nowhere. And even though I had maintained all my savings in my first 20 months of self-employment, I wasn’t happy with how much I was spending on my business and I hated feeling like all I was doing was staying afloat. So, I set a list of intentions and have spent the last four weeks crossing off every last one of them.
Experiment #2: Slow Money
set new financial goals for 2017 – done!
track my spending / make sure it aligns with new goals – done!
change my budgeting strategy – done!
change my investing strategy – done!
analyze / find ways to reduce business expenses – done!
bonus: file my taxes – done!
Most of these were easy to tackle. I’ve done this exercise enough times to know what I value, which made setting new goals and finding ways to achieve them simple. However, when it came to changing my investing strategy, I struggled to get comfortable with implementing what I knew I wanted to do.
A few weeks ago, I gave you a peek into my head and talked about the mental block I’ve had when it comes to investing. Essentially, I’ve been reluctant to setup automatic savings programs, because I’m always worried I’ll run out of money and will need what I invested. This has resulted in me only making a few lump sum investments each year, and I haven’t been happy about it. There is nothing fun about being stuck in a scarcity mindset and constantly feeling like you’re going to run out of money. And sadly, many of the comments and emails I received from that post showed me I’m not alone.
When I first wrote that post, I thought this had only been an issue for me since I had become self-employed in 2015. With irregular income came irregular investments. But the more I thought about (and talked about it and journaled about it), I realized I have always had a scarcity complex about money.
Until I was 25, I was living paycheque-to-paycheque and trying to manage multiple debts. Most of the time, my money was gone within a week and I spent the next week living off credit while waiting for payday. From 25 to 27, I was still living paycheque-to-paycheque while paying down those debts. For the first year I was debt-free, I continued to mostly live paycheque-to-paycheque while saving just 5-10% of my income (when I was once putting up to 55% of my income towards debt repayment). And it wasn’t until I did the shopping ban that I learned I could live on less and save/invest/travel more.
But even after the success of the shopping ban, when I saved an average of 31% of my income, I hadn’t kicked my scarcity mindset to the curb. And now, even though I have access to more than $20,000 of cash at all times, I constantly feel like I’m living on the edge and could run out of money at any time. I’m not a psychologist and can’t pinpoint a specific reason for why I feel this way, but it’s probably safe to say that nearly 15 years of living paycheque-to-paycheque has something to do with it. (How I ever felt comfortable enough to quit my job with steady income is still an anomaly, at this point.)
Throughout the month of February, I found myself continually struggling to make financial decisions, because my scarcity mindset was always getting in the way – but never more so than when it came to implementing a new investing strategy. I knew what I wanted to do, but it took weeks to finally commit and put the plan in place. And as time went on, I realized my goal for this experiment was about so much more than just doing a check-in with my finances: it was to learn how to approach things from an abundance perspective, so I can stop acting out of fear and start believing I am in control of my future.
Here’s how I plan to adopt an abundance money mindset:
Be grateful for what I have. (It’s more than I’ve ever had and it is enough.)
Give wherever possible. (Like Jason Connell says, “Practicing generosity trains you to understand that you already have enough.”)
Be open to new opportunities to earn more. (I’ve held some limiting beliefs about the kinds of work I can do for far too long.)
Invest regularly and trust it will help me grow my net worth (not make me go broke).
Each of the four points in this list are important, but the last point is the one that requires the most work as well as the greatest mental shift for me personally. A couple months ago, I decided to move a chunk of my investments over to Wealthsimple. I had been using Tangerine’s Balanced Growth Portfolio and would recommend their funds to any beginner investor, but I wanted to reduce my fees and have a better understanding of the ETFs I was investing in. So, with the help of my new friend (and money coach) Ben Van Dyke, I made the switch. But I hesitated to setup auto-depositing…
I kept getting stuck in that same old mindset: the one where I worried that I would run out of money and regret investing any because I needed the cash. It wasn’t until I ran three different annual income scenarios and saw how much I needed to earn in order to invest a certain amount that I realized the probability of me earning enough to invest at least $5,000 was high. I also knew I had invested that amount or more every year for the past few years. I took this information and set it up so I’m now investing $100/week ($5,200/year) in my TFSA with Wealthsimple.
This is the first time I have ever setup an automatic savings program. I repeat: it’s the first time I have ever done this. It’s only been a few weeks, so it’s too early to know how I feel or even do a proper review of Wealthsimple. I will say, so far, I haven’t noticed the $100 disappear from my account each week (likely because I have income deposited numerous times throughout the month). And I am loving the transparency Wealthsimple offers. But this is still new for me. I do feel like I’m in control of my future. But the whole trusting that I won’t run out of money thing will take some getting used to.
This projection is based off my current plan of investing only $100/week.
Even though the slow money experiment is over, and I feel it was a huge success, I know I can’t fix my scarcity mindset issues overnight. Again, I’m sure there is more than one reason why they exist, but living paycheque-to-paycheque for nearly 15 years must have something to do with it. I know from quitting drinking and impulse shopping that it takes months (or longer) to change a bad habit you’ve spent years perfecting. But from those experiences, I have also learned it’s possible to change anything, when you set your mind to it. This is fixable. It won’t happen overnight, but it will happen.
Going forward, whenever I’m struggling to push past the scarcity and make a financial decision, I’ll run through the list of ways I plan to adopt an abundant money mindset. And if that doesn’t work, I’ll remind myself it’s been years since I’ve run out of money – and I am in control of my financial future.
How did your slow money experiment(s) go?
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Extra Reading
6 Little Money Mindset Shifts That Pay Off Huge – Marie Forleo
From Scarcity to Abundance: Mastering the Mindset of Wealth – Money Boss (JD Roth)
The Abundance Loop – Conscious Living Magazine
The Difference Between Abundance and Money – James Altucher
Your Scarcity Mindset is Ruining Your Finances – Money After Graduation