The Biggest Secret to Building Wealth in a New Country (Hint: It Isn\’t Budgeting, Saving, or Paying Down Credit Card Debt)

Have you made little to no progress with your money goals despite doing everything you can to improve your skills in budgeting, saving, and paying down credit card debt? That might be because you aren\’t using the most important area of your mind that you have available to think about money. Real progress on money comes down to embracing your right money mindset.

Your Money Brain Space

Most of our brain\’s power we cannot even begin to understand.  In fact, scientists have openly acknowledged how little we actually know about the brain\’s potential. One thing we do know is that our brains set serious habits. Those habits set deep pathways in our brains that get traveled over and over throughout the years. Our brains become deeply hardwired to go down those well-traveled roads, making those roads more and more paved.

As Charles Duhlgg explains brilliantly in the book The Power of Habit: Why We Do What We Do in Life and Business, these patterns can be rewired to change. But it takes perseverance.

Your brain\’s thinking patterns have a tremendous effect on everything in your life. And that includes how your brain thinks about money. Spending money. How much money you will have. And beliefs about how much or little money could ever be yours.

Now visualize that there is one little section of your mind carved out just for thinking about money. This is your money mindset.

Money Skills and Money Actions

We love the book Her Money Matters: The Missing Truths From Traditional Money Advice by Jen Hemphill (who by the way, is a badass bilingual Latina businesswoman) because it details the breakdown of your money mindset. Her Money Matters explains that the traditional money skills (budgeting, saving, making money, dealing with debt, etc.) really only fill up a tiny 10% of the area of our money brain space.

Wait whattttt, did you say just 10?! That\’s right. All those things everyone tells you to focus the most on only take up a small sliver of the brain space you have for money matters. We were shocked too when we first heard. Budgeting, saving, and reducing debt are what most personal finance books and blogs talk about.

Another 30% of our money brain space is available to focus on money actions such as learning to feel more comfortable talking about money with loved ones and friends and building up financial confidence.

Most people never get to exercise these money actions and always remain in that 10% – leaving 90% of their brain\’s potential creative money mindset completely unused.

In total, according to Her Money Matters that still leaves only a minority — 40% — of the brain\’s total money space occupied. Below we will get more into what\’s waiting to be explored in that remaining 60% – the majority of your brain\’s money space. But first, let\’s talk about why immigrants shouldn\’t limit themselves to that smaller piece of the money brain.

Thinking (or Should I Say, Freaking Out) About Money After Moving to a New Country: Immigrants and Money Brain Space

If you are an immigrant living in a new country (or even if you are like the majority of people in the world), you too may be spending almost all of your mental energy focusing on that small 10% or 40% slice of your money brain space.

You might need to worry first things first about being able to pay your rent at the beginning of the month. Or to be able to buy enough food that month to eat. Maybe you need to send some money back to your family at home because they have even less than you do. It might even be the case that you are more responsible than most people, and you are actively trying to lower your credit card bill and pay off student loan debt.

We know how hard it is because we\’ve been there. When my husband first immigrated to the U.S., all he could afford for housing was to live in a small closet in the basement a shared house. His bed was next to the boiler. We worried each month about whether he\’d be able to make the next month\’s rent. We both felt overwhelmed. Even thinking about saving seemed utterly impossible. Budgeting was a necessity. But even budgeting was way too much to think about.

All of our thoughts, fears, and energy were dedicated to that 10% of our brains\’ money thinking potential.  I honestly don\’t think we were even using the full 10% because we were so anxious about the whole situation. At the time, it certainly would have been impossible to even think about anything beyond that 10% of thinking space. The next 30% of money actions didn\’t start to even enter the radar until very recently, years later. And we still spend a lot of time focusing and worrying about the basics of saving, budgeting, making money, and reducing debt.

As we have experienced, thinking and worrying about these money skills are extremely important necessities for immigrants. For example, before anything it is particularly important to start saving up for an emergency saving rainy day fund. Honestly, for us it still feels like a luxury that only rich people get to afford to sit back and reflect on different ways to think about money. I mean c\’mon, who has time for that?

But this is why it\’s important. If you just focus on saving, budgeting, and reducing debt, you probably won\’t ever build or see yourself have wealth. If you only set attainable goals, you won\’t get to surprise yourself with what you\’re capable of achieving. No matter what how hard you work on developing your money skills to budget most strictly, or save a little bit more money, or pay off a few bucks more on your credit card bill, your situation probably won\’t improve that much. That\’s why it\’s worth stepping into that challenge and jumping in to explore the remaining 60%.

So….What\’s Left That Takes Up the Majority of Our Money Brain Space?

According to Hemphill in Her Money Matters: The Missing Truths From Traditional Money Advice, the remaining whopping 60% — and the vast majority — of your available money brain space waiting to be accessed is your money mindset.

Money brain space, money mindset…..huh? What\’s all this woo woo talk you say? Stay with us. We promise it\’s worth it. We\’ve been talking about the space in your brain set aside to think about dollar dollar bills. Your money mindset is a piece of that – a big piece of it.

No, it\’s not about how much you can stash away to save. And no, it\’s not about punishing yourself to budget. Money mindset is about your relationship to your money. It is how you frame, relate to, and approach all aspects of money in your life. 

And most importantly: what you\’ve been waiting to hear since reading the title of this post. Ultimately, your money mindset — if you choose which one to have wisely — is the biggest secret you have to building wealth.

Your Money Mindset

Along the range of money mindsets you can have, one extreme is having a scarcity mindset. This is when when you live paycheck to paycheck without any savings and are in constant survival mode. At one point in the month you are terrified of spending any money because you know you have close to none. And then once you get paid, you spend most of it quickly. The cycle repeats. Again and again. There is never enough money no matter how much you try to budget or save. You are always anxious and fearful about not having enough.

The opposite extreme is when you live life with an abundance mindset. This is not about having more money or pretending that you do when you don\’t. It’s a state of mind. A mindset of abundance means staying open, choosing courage over fear, and deciding to believe that you will have more than enough to meet your goals. That doesn’t mean that you have to ignore reality or live in a fantasy land. Instead, abundance mindset means that even if at that very moment you don’t have a plan how to get the resources you need, you choose to trust that you will find a way and do not live in panic survival mode assuming there\’s never enough for you. You do not let your fear control your actions and decisions in life. And although at times you might be scared, you don’t let yourself ruminate about the unknown.

Scarcity vs. abundance money mindset is a choice. Our brains have an incredible amount of capacity to make that choice and engage in transformative thinking and overcome limiting beliefs and habits. The book The Power of Habit: Why We Do What We Do in Life and Business teaches us that we can break hardwired habits and literally change the pathways in our brains, even those that are deeply rooted. It\’s not easy. But it\’s also not impossible.

The Importance of Abundance Money Mindset for Immigrants

If you are an immigrant, your money mindset could not be more important. Although money skills like saving and budgeting are very important tools in your immigrant finance toolbox to use, saving and budgeting alone – without an abundance mindset – are unlikely to help you build stability and wealth.

This is especially true in a new country. Tremendous opportunities are available. And wild success is in fact possible. The best evidence of this is that almost half of Fortune 500 companies were founded by immigrants or their children.

But in many ways, as an immigrant the odds can also be stacked against you, particularly in the beginning. You may face challenges as someone who might have less resources and connections compared to someone who grew up there. You may not speak the language well or at all or have an accent. Your degrees from your home country might not be recognized. Discrimination can be crippling. You probably are not as familiar with how the system works. Being separated from your family can take away your strength at times. Perhaps you do not have legal immigration status or a work permit, making it difficult to get a job. This list goes on.

Exactly because of these opportunities and the challenges immigrants face is why you need to think about adopting an abundance money mindset.

The power of the right money mindset

The New York Times published an article about the wonderful money mindset book Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence: Fully Revised and Updated.

One person featured in the article said that before he read the book, \”Ninety percent of my brain was dedicated to making money.\” That means that he was spending almost his entire money brain space focusing on just that 10% area of the brain dedicated to basic money skills. What was happening to the other 90% of his brain? It wasn\’t being used.

After reading this book, he remarked that \”it’s literally like 90 percent of my brain opened up.” He engaged that extra majority of his money mindset brain space that is available but hadn\’t been used. And a whole new way of seeing the world became available. This is not surprising – the impact of freeing your brain from scarcity mindset, and opening it up to abundance mindset is nothing short of powerful.

Using more of your money brain space – particularly the 60% majority of space reserved for your money mindset – can shift your entire experience with money and life.

Increasing the Impact of Your Money Mindset By Connecting to Your Immigrant Culture, Values, and Experience

Focusing on abundance over scarcity may also help you draw strength from your ancestors and culture at home. The money mindset of abundance can be even more impactful if you combine it with your immigrant culture, values, and experience. The author of the New York Times article about the book Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence: Fully Revised and Updated acknowledged the impact of shifting her money mindset to reframe her own life as part of an immigrant family:

\”…what I took away from it was a shift in thinking, from chasing money for the sake of having it to using it in service to my goals: to help my parents, achieve financial and mental freedom and continue to write full time. It worked for my family: My dad’s thriftiness helped him buy a home and start his own small business, and it helped my aunts purchase property back on the island for their retirement. I’d forgotten the values I learned as a child. “Your Money” reminded me.\”

Breaking Out of Scarcity Money Mindset to Travel to the Land of Abundance

Here at Immigrant Finance, we believe that you can break out of your scarcity mindset and embrace an abundance mindset. It takes commitment and hard work to change habits. But there are great resources out there to help you along the way. The Power of Habit: Why We Do What We Do in Life and Business is a great starting point; it very effectively walks you through how to change the habits and patterns that are hardwired in your brain.

Although very important, using only the 10% area of our money brain to focus on saving, budgeting, making money, and paying down debt is unlikely to help you build wealth and transform your life. Even if you can take money actions to engage in the next 30% area of your brain, you will likely still stay stuck in the scarcity money mindset. This is especially important if you are an immigrant in a new country and you want to overcome the many challenges that you have to face as someone with less resources, connections, and familiarity than someone who grew up in that country.

It\’s time to break out of your scarcity mindset and embrace an abundance mindset. The risk of remaining in the status quo and operating from a place of fear and scarcity is just too great otherwise. By committing to embracing an abundance money mindset, you can experience the remaining 60% of your money brain space and change your life.

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