Two Money Traits Every Broke American Should Know.
I want to explain how money works so inflation coverage makes a little more sense.
Talking about inflation and feeling inflation creates different responses; the inflation numbers give us a historical perspective of where we are today. However, the 8.5% inflation in the 80s would feel very different from the 8.3% in 2022.
As I write this, news on inflation brings the value discussion back to the forefront.
· A decrease from 8.5% to 8.3% still means levels not seen since the 80s
· Grocery prices have increased 10% since last year
· Housing has increased by 5% since last year
When wages stagnate, and prices rise, many people in the U.S. may feel like their money is worthless.
That’s an immense problem when you understand how money works.
Fake Money vs. Real Money
Fake Money and Real Money drive our currency. Real Money means a precious metal like gold or silver, or other commodity backs the value. However, with Fake Money, there is no tie to a commodity. It’s a human system rooted in trust.
The U.S. system used to use Real Money. However, the country and others have shifted to Fake Money for the past forty years.
Money has no more inherent value than any other piece of colored paper; You realize this when your currency doesn’t work in another country.
In the U.S., with 50 euros in your wallet, you know the Euros are worthless even though they have value.
The agreement to assign and recognize value allows us to use Fake Money as our currency. Without this agreement, money can be worthless.
Fake Money is viable because of two inherent traits, belief and time to create value.
The Trait of Belief.
The foundation of our system is belief; you believe in the value of money, now and in the future.
“Backed by the full faith and credit of the government” means the paper you have is worthless, but you believe the government will back it.
Now and in the future.
Over time, you must also sustain this belief for the system to work and maintain the best outcome for your money beliefs to manifest.
Money has to become more valuable over time than it is today.
If your money loses value over time while prices of goods and services go up, you lose.
Your confidence in the future increases the value of money the most.
That’s where time plays a role.
The Trait of Time.
You must believe in the future that you will earn more, that your savings will be worth more, and that the cost of goods and services will assume a smaller proportion of your income than today.
Time amplifies your belief. You believe that if you save now, the future will be better.
Therefore, wealth building requires a mindset guided by specific goals, beliefs, and the patience to time manifests the belief.
Success with your Money Mindset means you get the Money you desire; you love the life you desire.
A Money Mindset is not an attitude; it’s a habit. It’s a part of behavior. Best of all, the steps are minimal. Gain awareness, then act.
If you are not aware of every aspect of your Money Mindset, it’s time to start. Wealth building is more than products and services. It’s how well you know and use the choices available to you.
Here is a straightforward process to help identify money choices.
Start with SMART financial goals that are short-term in nature. Ex. Save $500. But the goal here is to decide what to do with the $500.
1. Save $500
2. Decide what you will do with $500 once saved.
3. Now save another $500.
4. Decide to do something different from before with the $500.
5. Repeat this cycle a few times; at least 4x, saving $2000 over some period.
Now analyze the cycles
· Did it take the same time, more or less time, to save $500 each cycle?
· Out of the four choices, which did you prefer and why?
· How much money do you have right now from the savings?
· Of the four choices which preferably give you more of a return?
The way we build wealth is not by being sold products and services. It happens by being aware of our habitual money choices, positive or negative, and choosing to remain the same or change.
I have found that most people do not overcome the barrier that you don’t understand that you can act.
What we’re looking for is not happening. Waiting is killing us.
The irony is — we are all waiting for ourselves. Waiting for things to start, the right things to say, or opportunities to show up. We are waiting for life to become as we wish it to be. Learning instead of doing and doing consistently is the key to building knowledge and confidence.
Regardless of how bad the news sounds, maintain the belief that in the future that you will earn more, that your savings will be worth more, and that the cost of goods and services will assume a smaller proportion of your income than today.
George Blount coaches indivuduals on wealth building strategies, money tips, overcoming money blocks, and passive income strategies for the new generation of wealth builders. Sign up for my newsletter and take the Money Mask Quiz at https://moneymask.ck.page/gmblount .