#16 Creating Wealth: Your Financial Mindset
Updated: Jun 21, 2021
Creating Wealth is an in-depth conversation between Bill Taber, an experienced financial advisor, and his millennial daughter about personal finance, investing, and financial planning.
Bill Taber is President of TABER Asset Management, a Registered Investment Advisor (RIA) and fiduciary firm located in Des Moines, Iowa since 1998. For decades, Bill has provided investment management services to clients, creating wealth, building wealth, growing income, and preserving capital for each and every client. TABER offers personalized asset management, wealth management, retirement planning, financial planning, and services such as 401(k) rollovers.
His daughter, Anastasia, lives and works near Washington D.C. She enjoys discussing finances and her cats’ latest antics with her dad.
Episode 16: Your Financial Mindset - How important is thinking positively when it comes to creating wealth? How can you retrain your brain to think abundantly? In this follow-up to the third episode, "Having an Abundance Mentality," Bill and Anastasia discuss what it takes to think positively about your finances. Bill mentions examples of negative thoughts you or family members may have about wealth and how to address them. Anastasia suggests negative news can influence how you view wealth creation and admits that social media ads have sometimes worked on her.
For questions and comments, you can email us at email@example.com.
Anastasia: Welcome to Creating Wealth, I’m Anastasia.
Bill: Hi, I’m Bill.
Disclaimer: The views expressed today are our own, solely for informational purposes, and it is not an offer to buy or sell, or a solicitation of an offer to buy or sell any security or instrument or to participate in any particular investment strategy. The views are subject to change and are not intended as a forecast or guarantee of future results.
Anastasia: We've been thinking about doing a follow up to the abundance mentality episode that we recorded a few months ago. The past couple of months have been a super hard time for many, many people. This pandemic has destroyed livelihoods, and has diminished people's wealth. But we really wanted to focus today, not on the external factors, because obviously, there's so much that's out of our control. But instead, we wanted to talk more about what is within your control. And that is your mindset during this. So we wanted to follow up with all of this in mind of what's been going on and talk more about the abundance mentality and what it means to have it.
Anastasia: So Dad, how important is thinking positively when it comes to creating wealth?
Bill: It's very important--the two are inextricably connected. I'll give you several quotes. The person that said it best was Napoleon Hill, who wrote a book called, "Think and Grow Rich." And in that he said, "What the mind can conceive and believe, it can achieve." There was a philosopher of the early 20th century by the name of William James, who said, "The greatest discovery of my generation is that a human being can alter their life by altering their attitudes” , or in this case, mindset. And there was another famous person that put it a little differently--Henry Ford, the guy that started the Ford Motor Company. He said, "If you think you can do a thing, or if you think you can't do a thing, you're right."
Anastasia: Thought becomes action?
Bill: Yes, I'll give you an example in my life. I've been involved at a community level with the local hospital that serves the uninsured and underinsured of our community. The hospital has been in existence for 96 years and over the last 40, 50 years, they were operating on a very, very thin margin, unable to have the money basically to update their plant and equipment, keep their facilities current. And they weren't able to replace broken equipment. They didn't feel that they could advertise for their services, because that would take away what limited funds they had to provide care to people that didn't have resources to pay for it. And they only served the uninsured, because they were supported by a minimal tax levy that covered that. About 15 years ago, we said, "Instead of thinking about poverty or thinking about scarcity, and what we don't have, let's focus on what we do have: We have a hospital that's functioning, we have a dedicated staff of employees, and we have very high quality doctors/providers." So we started thinking about what we did have instead of what we didn't, and then in the process of that, broken equipment got thrown out. In some cases, we're about to pay for replacements right away, but in other cases we weren't, but that focused us on coming up with the money to replace that equipment. We started an advertising budget. We started telling the story of the high quality services that are offered at the hospital. And instead of just serving the poor, or the uninsured, we opened it up and said we're going to serve the entire community, you know, everyone, including those people that have coverage through commercial insurance. And when we started doing that, the finances of the hospital began to improve. And today, the hospital is thriving primarily because we started focusing on what we had and what we could do, not complaining about what we didn't have and what we couldn't do. Does that make sense?
Anastasia: Yeah, I mean, that's interesting, because in that example, that's an entity, but you're talking about changing the mindset of everyone who's involved with the leadership of the hospital and thinking about things in a more positive way, focusing on what you do have rather than what you don't have. And by doing that, you're able to be more proactive.
Bill: That's what happened at an organizational level. But you know, the same process can happen at a personal level. Let's talk a bit about the pandemic that's going on right now. Millions of workers, for no fault of their own, have lost their jobs. You know, research was done on this, but they showed that 40% of workers went into this without any cash reserves or any emergency funds set aside. So when they lose their job, suddenly they don't have any money.
Anastasia: Or if they did, it wasn't very much.
Bill: Well, yeah, another 30% had only three to six months worth of monthly expenses saved up, never thinking that a pandemic could cause them to need 12 to 18 months of reserves to set aside. So for people that are out of work, this process of thinking abundantly, lots of jobs have been eliminated, but there are other jobs that are out there to go after. So they need to see this as an opportunity. First and foremost, they need to believe in their own innate potential, their ability to be flexible, to be able to go after new opportunities. And an article that I read several days ago said that 63% of people that have been laid off during this pandemic have already changed industries. And so, that's what's great about America is the people are flexible, and they go out there and they seek other opportunities. Those opportunities would be away from the hospitality industry, or restaurants, the ones that have been disproportionately affected by the pandemic, and into industries like tech or Information Technology, Health Care, warehousing, package, delivery, etc. And there are changes that have occurred because of the pandemic that have advanced more quickly by a factor of years, the ability for people to work from their homes instead of having to work from commercial office buildings. So opportunities are being created in this pandemic. And to the extent that people are flexible, then they have an opportunity to move forward and become re-employed.
Anastasia: Yeah, I mean, that's great that people have been able to change industries.
Bill: For those at this point that have not found other jobs, it gets a bit more dire when suddenly the cash dries up. And so it becomes a matter of looking at things that perhaps you hadn't considered before. Like, do you have an extra car that can be sold? Or are you in a lease arrangement or a lease agreement that can be gotten out of? And another thing that hasn't been considered but historically has occurred during the Depression back in the 1930s and other times is, you know, moving in with the parents. I know that that's not a satisfactory thing long-term for most people. But historically, during difficult times, having multi-generational homes, or multi-generational families has been a way of helping people get through. So you might have grandparents, parents, and children all under one roof for a while. Getting more training--there are classes online today that are available, can teach you many different things, and are available at a far lower cost than being on a campus somewhere. So I think the key is to stay positive and to focus on the opportunities that are out there, not the obstacles.
Anastasia: Why is that so important?
Bill: If you focus on an obstacle, and then it's hard to see a way to get through it or around it. But if your mind is focused on an opportunity, something that's out there that could happen, then you may achieve it, you may not, but at least by focusing on the fact that it could happen, gives you a chance of making it happen.
Anastasia: How would you do that if you felt like everything was going wrong for you.
Bill: That's a matter of retraining your brain. It's a process of rewiring your brain to a new mindset. Science and the technology of brain scanning has determined that your mind cannot tell the difference between a thought that is vividly imagined in your head, with a thought that is a memory of an actual experience. So a very powerful, imagined thought that engages your senses, engages your sight, your smell, your taste, your hearing, your touch, can override a bad experience from your past, allowing you to change your mindset. And there are different ways to go about doing this that require some study. But typically, hypnosis has been one of the things that's worked. And this is not a de facto recommendation, but I know there's an individual by the name of Paul McKenna that has books and CDs about this. There's a program called NLP--neuro linguistic programming--that works on changing mindsets through the physical use of tapping. There are other programs out there like Jack Canfield and Tony Robbins that make the use of positive images and positive affirmations. Positive messages that are sent to your subconscious start to change your mindset. And then another individual that we spoke of in the original podcast on this was Oprah Winfrey's "The Secret," which gets to you know, keeping a positive image in your head and seeing that that can manifest itself in your real life. So as an example, instead of seeing yourself as growing up in a low income or a poverty background, you can use this to imagine yourself growing up in a family environment where all of your needs were taken care of, and where important role models were in your life that reinforced the message to you that you can do anything in life that you set your mind to, or where your thoughts about accomplishing things that you want to have show up in your life were encouraged, as opposed to squashed. You come up with a great idea and the person says, ``Yeah, you can do that," as opposed to "Man, nobody's ever done that before in our family." So programming can lead to thoughts and thoughts can lead to feelings, feelings can lead to actions and actions can lead to results. So it's a matter of rewiring the brain. And science has proven that that can be done.
Anastasia: Are you willing to talk about your own experience with that?
Bill: Without getting into tons of detail about it, I grew up in a lower middle class to middle class background where I was raised by a woman that was my stepmother. My birth mother died of a heart attack when I was three and a half years old. My stepmother was a very nice woman. But she had some attitudes about money that I found as I grew into an adult that didn't quite mesh with reality. She had some ideas that really were self-defeating thoughts. They represented bad verbal programming - "You must be dishonest. How else could you have the money to buy that luxury car? All rich people are greedy. Or they must have broken the law to get that money." Or the terms that sometimes you hear on TV like, "This person is filthy rich." Money's not filthy or clean, it's just money. Another one that's very prevalent, "The rich get richer, the poor get poorer." Really? Is that the way that has to happen? The poor can't get richer, the rich can't get poorer? Another one: "We can't afford it. Daughter, we can't afford that." Actually, what they should say is, to tell the daughter, "We choose not to buy it. We have priorities." There's another one, "Money doesn't grow on trees, kid." Did you ever hear that one growing up?
Anastasia: Did I?
Anastasia: Well, I don't know, I heard it as like a societal joke. But you never, you never said that to me.
Bill: Mhm. So you have to disassociate yourself from these kinds of thoughts. You have to let them go. And when I got older, and I was able to kind of examine the way that I was raised, I was able to focus on some of these things and change them into more positive thoughts. Because your mindset is kind of like a thermostat, you can turn it up or turn it down. And by doing that, you can set the level of potential wealth that you can accumulate, or have show up in your life. So if you're telling yourself that you're poor, and that you were born to the wrong family, or that you're in debt, and you'll never get out of it, you probably won't, because maybe one of those negative thoughts was lodged in your subconscious when you were growing up. But on the other hand, if you tell yourself that your financial blueprint was set high as a child, and that you had lots of support, and you had people saying, "Yeah, you can do what you want to do in life," then you have the potential to create wealth, to have things show up. It's as simple as that.
Anastasia: That example you gave with telling your child, "We can't afford that," rather than, "We choose not to buy that." I think that's a really interesting example. Like both are true, right?
Anastasia: But one of them is very inherently negative, and teaches the child that they are denied something because of a lack, rather than because there are other priorities in play. And explaining that I think is a much more productive way to look at things is, "We choose not to buy this, because there are other things we need to spend our money on," rather than "We just don't have enough money to buy that."
Bill: Yeah, and sometimes advertising plays into it, too. Is, like, if you watch a lot of television, then you get the idea that anybody that has any money has a really expensive car. And the reality is, a lot of people that are financially well off, you know, they have a nice car, but it's not a luxury car, but they choose to take their money and save and invest it, as opposed to, you know, buy the latest, greatest new car.
Anastasia: Yeah, I mean, advertising definitely factors in. I mean, that's how our society is run. I mean, that's why our social media data is so valuable is because it's used to target us with advertisements. That's how Facebook makes their money.
Bill: They use it because it works.
Anastasia: Yeah, I mean, it does work. I have purchased things after seeing an ad on Instagram. It does work! (Laughs) Although I do it very consciously and knowing exactly what is happening, I know I am being slowly manipulated to think that I do need this product.
Bill: And part of wealth accumulation is learning to recognize that and to apply self discipline to do the opposite.
Anastasia: Yeah, in this case, it was this ad for seeing the movie, "Farewell." And I was very excited to see that movie. It was really good. (Laughs) And I don't mind that I got an ad for it, an ad several times, so that I remembered that it was out in theaters, and that I should go watch it.
Bill: But you also knew that it was within your budget?
Anastasia: Right! I mean, it was like a $13 movie ticket. So it's not gonna bankrupt me.
Bill: You had it in your entertainment budget?
Anastasia: Right, exactly. I had planned for that.
Bill: (Laughs) Any other thoughts? Questions?
Anastasia: I mean, can you be a rich person who is really negative about money?
Bill: I think the answer to that is yes. I think people who have businesses or enterprises that prey upon human addictions can become rich and prey upon negative influences in society. You know, whether it be human exploitation, prostitution, gambling, drugs, addictions, etc. Yeah.
Anastasia: Like Purdue Pharma?
Anastasia: They have just been slapped with a couple hundred million dollar fine for getting people addicted to Oxycontin. And a lot of people feel like that's not enough of a fine. It's like tantamount to a slap on the wrist when you have a billion dollars. And maybe that is what factors into some people's negative feelings towards the rich, right? Because they see this story of this family who took advantage of people, regular people, got them addicted to this massively addictive drug. And they think all rich people are bad, because that's what they see in the news, right?
Bill: Yeah, that's what they see in the news. Fact of the matter is that greed is an innate human tendency. Some people are more greedy than others, some people are able to control it. But in my experience, 98 out of 100 people that are in business, are ethical, moral, hardworking, honest, have integrity, and are doing the best they can for the people that they are providing services for.
Anastasia: Maybe we just don't get the news stories of them all that often. (Laughs)
Bill: Yeah, absolutely. You don't, because, you know, it's the two out of 100 that make the headlines. If it bleeds, it leads.
Anastasia: Yeah. So I mean, I can see that kind of factoring into some of the mindset that people have towards rich people is that you--like, what your step mom thought--was that rich people are dishonest, they're wealthy, because they're unethical. And that isn't really true. A lot of rich people are wealthy, because they provided a service to people that was really beneficial enough to make them a lot of money.
Bill: That added value to their lives.
Anastasia: Right. Like Jeff Bezos, I mean, he's the wealthiest person in the world. You can not like him, or how he's treating some of his workers. But the fact is, he offered a service that was hugely beneficial and transformative for so many people's lives. I don't know, I'm not sure if he had a lot of competition at the time, but it was kind of just this enterprising idea that has changed how our society functions. I mean, I see those Amazon trucks out all the time delivering packages, and during a pandemic, I mean, Amazon's the company that's hiring right now.
Bill: Another example was Bill Gates of Microsoft. Like Jeff Bezos, he looked at things differently and created a service that helped millions and millions of people. He basically created the software that put computers in everybody's home.
Anastasia: Love them or hate them, but there's a reason why they're so incredibly wealthy. And it's not necessarily that they're dishonest or unethical.
Anastasia: Yeah. So I just think this idea is really interesting that so many of us have this kind of programming. I guess it's kind of a black and white way of viewing things. And it's kind of up to you to force yourself to re-examine your relationship with money and your ideas about wealth and people who have wealth. And it takes, I mean, it sounds like it takes a lot of work to do that.
Bill: It takes effort. It takes some self reflection. But many people have been able to do it. I think you've summarized our conversation very well.
Bill: We will return to this topic when people have questions.
Anastasia: Sounds good. Well, that's all I had. Thanks, Dad.
Anastasia: Thank you for listening to Creating Wealth! If you liked our podcast, please subscribe and consider recommending it to your friends or leaving us a review on your podcast app. We would love to discuss your questions. You can email them to us at firstname.lastname@example.org. You can also find full transcripts of every episode on taberasset.com. That’s Taber with an “e” not an “o.” Thank you for joining us on the path to financial abundance. We’ll see you next time!