This may be the best book I have ever read - and it may also help my finances

I am reading The Growth Mindset by the Stanford University Professor, Carol Dweck and there are so many amazing takeaways about money in there. Dweck specializes in the psychology of motivation, and has identified two different ways that people think: the growth mindset and the fixed mindset. Don’t worry, this isn’t a test to find out which one you have. You’re neither one nor the other: we’re all a bit of both. But understanding these two types of “self-talk” can really help us achieve our goals.

Growth vs. Fixed

With a fixed mindset, you see your abilities and characteristics as set in stone, and that’s how your inner voice talks to itself at times of stress. You might say “I’m bad with money”, “I’m so forgetful” or “I have no willpower when it comes to spending / food / exercise”. So when your attempts at self-improvement go wrong, you just put it down to this indelible fact about yourself and give up.

A growth mindset sees problems a little differently: not as opportunities for failure but for an interesting challenge. It attaches no negative emotion to getting something wrong, because it knows you are constantly evolving and learning (which is a pretty cool and inspiring state to be in) rather than imprisoning yourself in a cage of your own character.

Hmm.. that sounds a lot like me. How can I get out of my fixed mindset with money?

Try this trick: next time things go wrong (say, you’ve overspent on your monthly budget and can’t make your debt repayment) approach the problem like a detective. Not a judge or harsh personal critic, but an inquisitive investigator who just needs to find out what, when, why and how things went awry. Was there an emotional trigger that made you spend £300 on a pair of shoes? Maybe you were nervous about not looking good at a particular event? So work on your self-esteem by doing things for others, listing your great qualities, or remembering all the different ways people can be beautiful. Maybe you got in to an anxious tailspin about health and splurged half your budget on some mad food supplement? Consider your health anxiety: what’s it really about (the inevitability of ageing, perhaps?) and what can you do about it that is cheaper and more sustainable than buying pricey detox drinks or a sack full of organic chia seeds (walk to work? Pre-prep some filling and tasty salads for next week’s lunches?).

Remember, nothing is set in stone

Our bad financial habits may have deep roots in our childhood and the money culture we were raised in. But that doesn’t mean that being in debt, ignoring bills or over-spending is hard-wired in to us. After all, I bet there are some areas of your life where you have a really healthy growth mindset already: parenting perhaps, or a hobby you became interested in as an adult. Even social media – after all, no one had heard of Instagram, facebook or twitter ten years ago but look how good you are at making them work for you now! You weren’t that old lady who said “oh no, computers aren’t for me”, because you saw technology as an interesting new thing to learn about and benefit from.

Apply the same can-do attitude to personal finance, and all those doubts about your abilities that have held you back will start to look plain silly. Next time you find yourself saying “I’ll never get out of debt! I’ll never meet my savings goals!”, remember that it’s that very state of mind that’s preventing you from making positive changes to your money habits. You’d never talk like that to a child who was struggling to learn to tie their shoe laces or get potty-trained, would you? So don’t be so mean and short-sighted with yourself either: you’re just learning! We all are. And failure is such an important part of getting better at something. Professor Dweck knows (and I think you do too) that we humans don’t always run from difficulty: it’s within all of us to approach obstacles positively and without self-hate. And that, in finance as in life, is the way to success.