Dealing with a poverty mindset is a lifetime battle for most people. Only very few people get to really overcome it. Even when you are financially successful, you could be fighting a silent battle induced by a poverty mindset. Think about how politicians in poor and developing countries continue to loot their national treasury with no ending in sight. Poverty has made them only see the world from the perspective of scarcity, that no matter how much they have, they continue to live in fear that something could happen, and they would lose everything. This fear continues to drive them. To the ordinary person, these people are rich; but within, these are just mentally and spiritually poor people with a lot of money and power.
Well, this video is not about the politicians who are addicted to looting. It’s about you and me; who, hopefully, aren’t looting money or oppressing people. I want you to understand that the fight against poverty is not won by just making money because it shapes your mindset with subtle limiting programming that you don’t even recognize.
In an article written by Paul Graham, the founder of Y Combinator, he said, “I’ve seen this myself: you don’t have to grow up rich or even upper middle class to get rich as a startup founder, but few successful founders grew up desperately poor.” In order words, he observed that it is more difficult for someone who grew up in poverty to become a successful founder; observations from someone in the business of helping people start and scale their business.
He might have noticed a limitation in the mindset of such people who had lived most of their lives desperately struggling with money. They may be ambitious and driven to succeed, but there appears to be common resistance that puts a ceiling to how much these people dare. You may argue that the reason is because of lack of opportunity or capital; in other words; wealth inequality. But there is also the argument of mindset.
Poverty Instills Scarcity Mindset
Most of us will not agree that we have a scarcity mindset, but when you observe people’s patterns of behavior, you’ll see scarcity written all over it. For example, the most common mindset about wealth in society is the ‘pie’ or what some will call ‘national cake’ mindset; the belief that the size of wealth is fixed and that the rich simply get rich by taking more from the poor. Ask ten random people on the street what they thought about wealth, and nine out of ten of them will tell you that those at the top are grabbing a large fraction of the nation’s income – so large that little is left for the rest.
We grew up in environments where this fixed mindset is perceived as true. But it takes a conscious effort to observe and remind oneself that it doesn’t necessarily work like that; because in reality, you can create wealth without really taking from others. You can create wealth by giving people something they value more than the money they pay you. You can even create wealth by giving people something for free and having someone else pay for it. For example, I started an online publishing business over 10 years ago offering free service to our audience. We make money when businesses, universities, and corporations advertise on our platforms. With this business model, the company has created jobs for tens of people. The reality is that the size of wealth continues to grow as long as people are productive. Think about it, prices of things have more than doubled over the past 10 years, yet people continue to afford them. It takes a conscious effort for someone who grew up in poverty to live with this belief.
The Fear of Poverty
I know the bible says the love of money is the root of all evil. In this present time, the fear of poverty may have broken that record. I mean, look at what’s going on in most developing nations. People are willing to do anything to never experience poverty again, even to their fourth generation. It is common to hear people say that their major motivation to achieve success is their fear of poverty. This fear can either make one be self-motivated to succeed legitimately or it can make one become ruthless with their pursuit for wealth.
I am assuming that if you are watching this video, you are not among those who will do anything just for money. You want to make a legitimate income and give yourself a better life. However, that doesn’t exonerate you from the effect of this fear. You may still be limiting yourself.
For example, over time, I observed that I found it easier to give monetary aid to other people than to spend it on myself. I have to think through and over analyze before deciding to buy that wristwatch or footwear, even when I could easily afford it.
Through the course of building my businesses, there had been instances where my reluctance to make an important investment, in the effort to avoid losing money, had turned out to hurt the business. Because I have taken the time to observe and acknowledge this underlying operating system, I force myself from time to time to make risky financial investments and commitment – the calculated risk of course.
It is easier for someone who grew up in an environment where there is a form of social safety net to be comfortable with taking financial risks; because even in the worst case, they have something to fall back on. On the other hand, someone from a poor background may have parents and siblings looking up to them for financial support. Even if they don’t, the fear of poverty often compels them to be risk-averse with life. It’s preferable for them to get a stable job with predictable income than venture into a more risky venture. As a result, you are less likely to take financial risks. Of course, there are exceptions to all of this; but the exceptions are in the minority.
The Bottom Line
Firstly, you need to understand that making money is not a sign of escape from poverty. You can have a lot of money and still be in captivity of a poverty mindset – in other words, scarcity mindset. Your preconceived identity may be in continuous conflict with the person you are becoming. One part of you believes you deserve all the success while another reminds you of how you don’t belong here. Sometimes you feel so empowered you believe you could do anything. Other times you are reminded where you are coming from and why you have to be careful not to make a mistake that will take you back there.
Secondly, being poor makes you terrible at using money as a resource. You want to keep as much as comes your way, instead of deploying money as a tool to get more done. You will rather spend time than spend money; despite that time is a more valuable asset. This is a mindset you have to consciously deal with. It is not an extravagance to hire people to do what you don’t have the time or skill to do.
Thirdly, understand that to overcome the poverty mindset you must first and foremost become conscious of it and start challenging your default decision with money. You must understand that your default relationship with money is emotional. When you have spent most of your life dealing with lack of money, living below average life, and struggling to have a square meal most days, you don’t suddenly become smart with money.
Most people either become extravagant as revenge towards money and to desperately maintain the illusion that they are keeping up or they become frugal to the point that they deprive themselves of valuable opportunities. It takes conscious effort and education to find the right balance. And finding this balance can make the difference between living a fulfilling life and living a miserable and regretful life.
Experiencing poverty for a prolonged period of your early life leaves a lot of faulty program in your mind’s operating system. This bug will conflict with your vision to rise to your fullest potential. Poverty can become a motivation towards success but you have to be conscious to not let it shape your perception of reality – like believing you have to take as much as you can from other people and keep as much as you can to keep poverty away.
You have to continue to remind yourself that there is an abundance of resources and opportunities out there. And that some calculated risks are worth taking.
You have to remind yourself that your grand idea is worth sharing with the world; and that you are good enough to possess such ideas.
When you have achieved little success, people who knew you when you were growing up will not hesitate to remind you where you are coming from and why what you have achieved is already good enough. You have to remind yourself that it is not just about the money but about how much potential you still have left to share with the world.
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