Here’s how to escape the scarcity mindset that is making you broke
Image source: UnsplashMost people believe they are broke due to their income or expenses. Under the spreadsheets, and even side hustles, lies something much more powerful: mindset. This way of thinking affects more than just how you spend money. This mindset affects how you spend, save, earn and even view yourself in relation wealth. You may feel like you’re always broke, but it could be because of your scarcity mindset. Or you cling to jobs, relationships, or financial choices that don’t serve you because you’re afraid there won’t be better options.
Let’s unpack how the scarcity mindset works, why it’s so destructive, and what you can do to replace it with something that actually grows your bank account.
Scarcity Mindset vs. Abundance Mindset
At its core, the scarcity mindset is the belief that resources, especially money, are finite, hard to come by, and easily lost. This leads to fear-based decision making. It embraces opportunities, calculated risks, and long-term thinking. It is characterized by opportunities, calculated risk, and long-term planning. It’s about your mindset, not how much money you have. How Scarcity Influences Your Daily Money Habits
Here is the sneaky part. People with a scarcity mentality often appear to be responsible. The scarcity mindset makes them budget obsessively and avoid large purchases. They also save every penny. But the fear of running those actions can quietly sabotage progress.
You might delay investing because of “what if I lose it?” You underprice your freelance work because “someone else will do it cheaper.” You stay in a job that drains you because “at least it’s something.”
This mindset encourages short-term safety at the expense of long-term growth. You end up stuck–saving but never building wealth, working but never thriving.
The Psychological Roots of Scarcity
Scarcity thinking doesn’t come from nowhere. It’s often shaped by traumas from childhood, like growing up in poverty, experiencing financial instability or dealing with job insecurity. The recession, rising student debt and increasing living costs are also not helpful. Maybe you adopted it to survive. Either way, it’s understandable, but it’s also outdated if you want to move forward.
Why Scarcity Mindset Makes You Spend More (Not Less)
Ironically, people with a scarcity mindset often spend impulsively. If your brain is in survival mode, logic can be pushed aside for emotional relief. You might overspend during sales because “you’ll never find it this cheap again.” Or you grab fast food because “there’s no time to cook.”
Scarcity steals your ability to plan calmly. Scarcity makes you feel rushed to make every purchase. Shopping becomes therapy. To change your financial behavior, you must first identify the beliefs that are driving your actions. Do you believe:
“I’ll never earn more than this.”
“I can’t afford to make a mistake.”
“Investing is too risky.”
“I’m just not good with money.”
Your scarcity mindset is in the driver’s seat if any of these sound familiar. You can’t change what you don’t see. You can’t change what you don’t see.
Image source: Unsplash
How to Start Rewiring Your Mind for Abundance
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Breaking free from scarcity doesn’t mean becoming careless or blindly optimistic. It’s about choosing long-term plans over panicky short-term decisions. These steps will help you rewire your thinking about money:
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1. Write down your first money memories. What did your parents tell you about money? What financial traumas have you experienced? It’s helpful to name these patterns. Challenge limiting beliefs.
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Every time you think, “I can’t afford that,” ask: Is that true? Is it familiar or is it true? It’s possible to find new ways of thinking when you reframe statements such as “I cannot afford it” into “How can I do this?”. Start with small wins. Track the payment you made instead of obsessing about debt. These small wins build confidence and that confidence fuels abundance. Invest in yourself–even when it feels risky.
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Whether it’s a course, coaching, or therapy, investing in your growth is how you break the cycle. Set financial goals based on joy, not fear. Set financial goals based on joy, not fear.
Stop setting goals like “I just don’t want to be broke.” Start setting goals like “I want to feel secure while traveling” or “I want a home that reflects peace.” Your goals should pull you forward, not scare you straight.
Scarcity Is Contagious, So Choose Your Circle Wisely
One of the most overlooked influences? One of the most overlooked influences is your friends and family. This energy will rub off on you if your friends constantly complain about money or ridicule people who “spend too much”. You don’t have to cut off friends but you should protect your mentality. Read books, listen to podcasts, and follow creators who promote financial possibility, not just frugality.
Real Abundance Isn’t About Riches. It’s about freedom.
The key to escaping scarcity doesn’t lie in becoming wildly rich overnight. Stop making decisions out of fear. Shifting your mindset creates space for smarter risks, better boundaries, and healthier habits.
Abundance means having options. It’s about believing that there is more to come if you continue moving forward. It means releasing the grip of “not enough” and embracing the idea that your efforts can grow, not just preserve, your wealth.
You’re Not Broken. Your mindset is just outdated
If money has been a source of anxiety, guilt or paralysis for you, you are not a bad person. You are not weak. It’s likely that you are just following a script of scarcity which no longer suits your life. You are allowed to change this script. You have the right to change that script. The scarcity mentality doesn’t go away overnight. The psychological warfare hidden in money-saving apps is changing. Here are 13 trends you should know. She’s covered everything from personal finance, travel, digital marketing and pop culture. She spends her free time reading, spending time outdoors, and cuddling her two corgis.
