60 Days to Change: Abundance

[Peter Dunn]

Understanding the Abundance Mentality

Our benign habits often aren’t as benign as they seem. For instance, many people keep too much money in their checking account in order to manufacture some financial tranquility. But keeping too much money in your checking account is very dangerous for a number of reasons. Of course there are the obvious reasons such as low yielding accounts, but it is the less obvious reason that can ruin a perfectly good financial situation.

Let me explain using my favorite bathroom resource: toilet paper. We have all been faced with the very alarming prospect of being stranded in the old water closet without the appropriate amount of toilet paper. It’s a terrible feeling that is laughable well after you get out of the jam. Believe it or not, there is something that you can learn about money in this situation. That lesson is: resourcefulness. When faced with “the cardboard”, you will find a way out of your conundrum. You will utilize corners of pieces of bits of TP. You will wet the cardboard. You will survive this catastrophe every single time.

On the flip side, when faced with a full roll of TP we often are quite wasteful. We completely forget about the experiences that we have been through before with the empty roll. We do the same things with our financial lives.

When you have an unusually large balance in your checking account you are staring down the barrel of a full roll of TP. Your economic stress is put to rest, and you start making subconscious spending decisions. When deciding on two items for purchase such as a gift for a relative, or a bottle of wine, you will often chose the higher priced item. A feeling of financial abundance can be a very dangerous thing. The more of a false cushion that you give yourself, the bigger the mistakes you can make. There is nothing wrong with having a smaller checking account balance. In fact, it forces you to be more responsible for each transaction.