The poverty mindset is a phrase I use to discuss a way of thinking many who grow up in poverty have learned. It is very deceptive. Relatively speaking, I grew up in poverty. Of course there are varying degrees of poverty, and poverty for some may be wealth for others. Part of the poverty mindset is believing that all your financial problems will go away if you could just make a little more money. This is a critical error that is incredibly simple, but is so deeply ingrained in the poverty mindset that it is very hard to undo.
The other day I was driving with my kids in the car. I was talking to them about the importance of salting the sidewalk in front of our home so that no one slips and gets hurt. If someone slipped, not only would it cause injury, but we could get sued. Responding to my son who asked what it meant to get sued, I told them a story about how my father one time got injured on the job and collected a settlement of a large lump sum of money. My son astutely responded with, “If grandpa got all that money, then you weren’t poor your whole life then right?” What a profound question.
My boys know the history of our family and how we struggled a lot financially growing up. We would sometimes be without electricity, or hot water, or a working home phone (this was before the mobile phone era).
This question my son asked was so incredibly insightful and perfectly captures the poverty mindset. Although my father received a lump sum of money at one point, we still never stopped living our lives to some extent in poverty. I still remember my mother rationing out the cereal even after that lump sum of money. Sure, we enjoyed a temporary time of relief for a year or two in which we were not lacking as much as we did earlier in my life. However, my father also had the home foreclosed on not more than 6 years after purchasing it. So why the poverty lifestyle even after a large sum of money was infused into the finances?
The answer lies in something that I am still learning to correct. Daily lifestyle, especially budgeting. If someone wants to break the poverty cycle, possibly the most important thing they need to do is learn to live within their means no matter how much they make, learn to write a budget and live under the authority of that budget. If we cannot learn to do that then we will never truly break the poverty cycle because no matter how much money we have, we will always feel like we need a little bit more because our spending will always be more than we bring in.
Below are a list of resources which may help you if you are trying to learn to break free from the poverty mindset and poverty cycle in your life. I hope you will join me in striving hard after learning how to discipline ourselves to live within our means and live according a budget.