Mindset shifts for financial success

From: alexhormozi

Achieving financial success often stems from adopting specific mindset shifts and practices, many of which can be understood by examining their opposites. By identifying common pitfalls that lead to poverty and then consciously avoiding them, individuals can achieve financial success and wealth [00:20:06]. This approach, known as inversion thinking, involves solving problems in reverse [00:00:16]. Our brains are naturally better at identifying problems and threats, an evolutionary design [00:00:30]. By listing ways to “destroy” a goal (e.g., a good marriage or financial success) and then doing the exact opposite, one can effectively achieve financial goals [00:00:24].

Core Mindset Principles

Action-Oriented Approach

• Start Today: The best way to stay poor is to always start tomorrow [00:01:37]. For financial independence, this means taking action immediately [00:01:39].
• Implement Knowledge: Don’t just read many books and do nothing [00:01:50]. Instead, read one book and apply its lessons [00:02:01]. This emphasizes effective habits and mindset strategies [00:01:53].
• Do More, Talk Less: Avoid spending all day preparing or talking about goals without taking significant action [00:12:38]. The most successful individuals focus on getting the right things done [00:10:44].
• Commit and See Through: Don’t constantly start new things without completing them [00:13:09]. Stay with a task until you become proficient [00:21:24].

Responsibility and Self-Reliance

• Seek Advice from the Wealthy: Avoid taking financial advice from poor people [00:02:06]. They often lack the knowledge for wealth [00:02:21]. This highlights the importance of the impact of social circle on financial success [00:02:12].
• Own Your Destiny: Do not rely on the government or others to save you [00:05:05]. You are the only one who can save yourself [00:05:12].
• Embrace Hardship: The world is not fair; acknowledge this and act accordingly [00:03:37]. Thank your circumstances for shaping you [00:04:22]. Strong character is built through difficult times [00:04:38].
• Stop Complaining: Complaining about uncontrollable things leads to no productive activity [00:04:03]. Accept and move on [00:05:01].

Resilience and Growth

• Persevere Through Failure: Failing once and quitting forever is a path to staying poor [00:03:11]. Failure is a necessary part of the learning process [00:03:27]; you either win or you learn [00:03:32]. This demonstrates the impact of mindset on skill acquisition and success [00:03:26].
• Embrace Discomfort: Avoid discomfort caused by the judgment of not being good at something new [00:06:29]. True discomfort comes from not accomplishing your life’s goals [00:06:57].
• Learn from Mistakes: Do not repeat the same mistakes over and over [00:14:20]. If your current actions lead to poor outcomes, change them [00:14:48].
• Never Stop Learning: Assuming you are always right prevents learning and growth [00:17:44]. Successful people have a voracious desire to learn from everyone and every source [00:18:08].

Self-Worth and Authenticity

• Value Your Own Opinion: Do not value the opinion of others over your own [00:05:22]. You are successful the moment you decide you are successful [00:05:35]. Success is a process of living your values, not just an outcome [00:06:17]. This is a crucial element of the winning mindset [00:05:35].
• Prioritize Being Rich, Not Looking Rich: Do not prioritize looking rich over actually being rich [00:09:31]. This means being willing to spend less for a long time [00:09:59]. Prioritize your own approval over others’ opinions [00:10:06].
• Keep Promises to Yourself: Breaking promises to yourself destroys self-reputation, which is the hardest to fix [00:08:08]. Self-respect is a key form of happiness [00:08:17].

Excellence and Strategy

• Tolerate Only Excellence: Do not tolerate mediocrity from yourself or others [00:07:02]. Hold a high standard, starting with yourself, to model for others [00:07:33].
• Act in Imperfect Conditions: Waiting for perfect conditions to start is a recipe for staying poor, as they will never arrive [00:09:04]. If you can succeed in bad conditions, you will remain successful when conditions change [00:09:16].
• Do What Matters Most: Avoid working all day on busywork that doesn’t move important goals forward [00:10:29]. Focus on the few things that truly move the needle, often the ones you procrastinate on [00:10:56]. This is critical for entrepreneurship and business growth mindset [00:10:53].
• Be Unique: Do not do what everyone else is doing if you want to be in the “one percent” [00:11:28]. Most people are poor, so don’t model them [00:11:53].
• Exceed Requirements: Doing “your best” may not be enough; what is required is what matters [00:11:58]. Become better so your best surpasses what is required [00:12:05].
• Be Irreplaceable: Avoid being replaceable [00:15:07]. Learn skills that others cannot easily replicate [00:15:20].
• Persist with What Works: If you find something that works, don’t stop doing it, even if it’s boring [00:15:50]. Many people know what to do to achieve their goals but choose not to do it consistently [00:16:36].
• Hire Smart People: Hiring incompetent individuals leads to a miserable life and a bad business [00:17:14].

Financial Discipline

• Spend Less Than You Make: This is the simplest economic rule for avoiding poverty [00:18:49]. No matter how much income increases, if spending exceeds it, one remains poor [00:18:53]. This relates directly to the financial mindset of wealthy individuals [00:18:53].

By internalizing these reversed principles, individuals can avoid common pitfalls and succeed almost “by accident” by simply focusing on not making common mistakes [00:20:09].