"The pessimist sees difficulty in every opportunity. The optimist sees opportunity in every difficulty."
Let me tell you a story about a boy. This boy had some good relationships with kids at school. He was pretty funny and could make people laugh. Math came easy to him so he was able to help people with their homework. He was pretty fast and good at sports. He could draw pretty good and liked to learn from others who shared his hobby of drawing comic book characters.
When he went home he played with some friends from the neighborhood, but he never hung out with the kids from school. He would hear kids at school talking about sleeping over at each others' houses. He was never invited over, but he never invited anyone over to his house, either. It seemed all his friends from school lived in large houses in fancy areas that had names, like Morningside, or Village Green. When kids from school had sleepovers at their house in Oakport they had (at least in his head) large basements where they would play Nintendo all night long and drink RC Cola. He didn't have that.
He was too ashamed to invite people over. What if they said "no"? What if they came over once and told everyone that there was no large basement with Nintendo and RC Cola? What if they found out he wasn't rich?
Shame kept him from having more friends than he had.
I know that boy well because that boy is me.
Money scripts are invisible rules that live deep inside our minds. They are contextual, partial truths that are passed down from generation to generation and drive our financial behaviors. Money avoidance is one category of money script.
If someone happens to be born in a low socioeconomic status, the shame that can come from that is very real. They observe the world around them and see, what they think, is everyone else enjoying life and it's just not possible to do anything about it. There can be a belief that they are trapped.
When they look at their life they see the fork in the road and often stick with the status quo. They take a vow of poverty and continue the life they know, even though it's a life filled with shame.
They don't try to advance their situation. They don't want to invest in education or training, because they don't see the value, or they don't think the value is worth the cost.
For many, it's far easier accepting the idea that the world is unfair and it's best to just live with it. It's a seemingly easier choice. The alternative is to go in a new direction and face a world that you don't know. That's difficult.
Wealth Doesn't Equal Income
One contributing factor in deciding whether or not to do something new is how easy it appears. Unfortunately for many, there is a view that being wealthy or successful means you have to have a high-income job. This confusion between wealth and income makes it seem impossible to get ahead for many, because if I can't get a job paying me six figures, then I'm doomed to be poor.
It's a little-known fact that having a high-income job is not a requirement for gaining wealth.
Cumulative Effects of Small Changes
One of the best tools available to us in personal finance is compound interest. The idea is that small changes over time will add up to big effects. It can seem boring in the short run, but exciting stuff happens later. The exciting stuff is the payoff for putting up with the boring stuff upfront.
The boring stuff is paying yourself first, living on less than you make, investing in yourself, looking for new opportunities, and getting your system automated. None of those things on their own is going to be life-changing tomorrow. But they add up!
Earning More...Without a High-Salary Job
When it comes to your cash flow - that is, what money comes in and what money goes out - you have two levers. You can spend less or you can earn more. Everyone always talks about spending less, and it's important. But fewer people seem to talk about earning more.
Many people, especially those who have money avoidant beliefs, earn less than they could be making. If someone has decided the world is against them, then they are less inclined to seek out promotions, they don't take interviews seriously if they get them, they don't ask for raises, and they don't look for jobs at other companies.
I know it's difficult to do these things, but consider this, if you've been in your current job for five years or more, there's a great chance you're being underpaid (note: I forget where I read this statistic, so, unfortunately, I can't link to it and I may be off on the exact number of years).
I can't talk about the shame associated with being in a lower socioeconomic status without talking about signaling and social media. This adds to the shame of being poor or feeling poor because social media is a wasteland of lies and nastiness.
To unpack what I