5 Money Mindsets That Are Tripping You Up

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Young beautiful woman with many shopping bags after shopping in a mall not satisfied with the buys
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Successful money management is about more than pure numbers. You also have to get inside your own head and make sure your perspective on money is healthy.

If you're looking at spending from a skewed point of view, it could be costing you.

Here are five common money mindsets that might be standing in your way -- and how you can stop falling into them.

1. Shop Till You Drop

If you see shopping as a hobby or a stress-reliever, you're likely to spend far more money than you ought to on things you don't even need.

Come up with alternate ways to channel your energy and boost your mood, like joining a gym, taking a cooking class or going out to coffee with friends.

Learn to see shopping as an errand to be done only when needed, and steer clear of stores and malls unless you have a reason to be there. Once you began viewing shopping as an errand or chore, you'll begin dreading it -– just as you dread scrubbing the toilet. You won't enjoy shopping anymore, and you'll want to spend as little time at the store as possible.

2. Extreme Frugality

An obsession with bargain-hunting can actually wind up costing you. You can become so wrapped up in the challenge of finding a good deal that you loose sight of the bigger picture.

If you're lured by the siren call of a sale or hot promotion, ask yourself if the item is something you truly need or if you're just attracted to the price. Make sure you're buying items that are both low-price and high-quality; it won't do you any good if you need to replace that cheap purchase in a few months -- or worse, weeks -- because it's worn out.

3. Love of Convenience

You pay a premium for convenience, and it's not always worth it. If you're in a genuine rush, it's OK on occasion to grab a coffee on the go rather than brewing it at home or buy a pre-made meal rather than putting one together yourself.

But if this is more your habit than your exception, you could be shelling out way more money than you need to be. Get into the practice of asking yourself whether you could get something cheaper if you made it yourself or bought in advance rather than at the last minute. The extra minutes you spend could be worth the money you save.

In fact, you'll find that "convenience" items (like grabbing a coffee on-the-run) become inconvenient once you develop the habit of planning.

4. Who Needs a Plan?

To manage your money properly, you need to be organized. From how much you'll set aside for savings each month to which items you need at the grocery store, systems and lists are essential to stay on top of where your money's going.

Create a budget and stick to it. Make shopping lists and stick to them. Come up with a strategy for your retirement, your investments, your holiday gift giving.

Don't treat your money haphazardly. Take the time to plan ahead and spend strategically, and your money will stretch much further.

5. Keeping Up With the Joneses

One of the easiest ways to ruin your finances is to worry about what everyone else has –- the classic "keeping up with the Joneses" effect. Maybe your neighbors bought a vacation home or your sister has a new SUV, but that doesn't have anything to do with you. Maybe all your friends own homes and you're still living in the same studio apartment, but they're on different timetables than you are, and their finances are in vastly different states.

As long as you're happy with what you have, don't pay attention to other people's lifestyles. In the end, having all the stuff in the world won't truly make you happy, anyway, so what does it matter how much stuff you have?

Instead, focus on what's truly meaningful: Picking a meaningful career. Traveling. Spending time with friends and family. Enjoying flexibility. These are more meaningful than having a diamond ring or an SUV that's as large as everyone else's on your street.

And by focusing on those priorities -– and subsequently putting your extra income into investments for your future, rather than toys and bling for the present day –- you may wind up in a much stronger financial position than "the Joneses."

Paula Pant ditched her 9-to-5 job in 2008. She's traveled to 30 countries, owns six rental units and runs a business from her laptop. Her blog, Afford Anything, is a gathering spot for revolutionaries who understand that they can afford anything -- just not everything. Visit Afford Anything to learn how to shatter limits and live life on your own terms.
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