Beyond the Technicals; The Mental Structure of the Wealthy August 6, 2008Posted by shaferfinancial in Uncategorized.
Tags: financial failure, mental structures, middle class mental structure, Rich Dad Poor Dad, technical analysis, wealth paradigm, wealth riddle
I have spent much of the last two weeks talking about the technical analysis of investing and why some products are better than others. But the reality of wealth creation is that folks can understand the technical side, however, fail to achieve their wealth goals. Why is this? Well, the largely unnoticed part of the wealth riddle is one’s mental structure. Scientist call this a paradigm, or a “an entire constellation of beliefs, values and techniques, and so on, shared by the members of a given community” (Thomas Kuhn, 1969). In short, every group has a set of mental structures that frame the way it thinks.
The poor has a set of mental structures that make it very difficult for them to successfully navigate the middle class. Of course it can be done, but this is why each socio-economic strata is sticky or retains most of its participants. The middle class has its own paradigm. And of course the wealthy their own way of thinking. The “Rich Dad, Poor Dad” series of books and education does a credible job in outlining the differences and it is well worth it to read Rich Dad’s Cash Flow Quadrant for example.
After reading and educating yourself, the wealth riddle gets toughest to solve. Technical analysis does not take a huge IQ or even advanced math, as Warren Buffett likes to point out, but to change your mental structure takes much more than reading a few books or attending a weekend seminar. It takes consistent and purposeful effort. And most people, even if they acknowledge the need to reform their mental structure, are incapable of doing it alone.
That is one reason so many people who are willing to pay thousands of dollars, to attend a seminar or buy a course, fail. Because the end of the seminar or course is just the beginning of the change. The light bulb might have gone off, but it takes much more than that to attune ones mental structure to creating wealth.
Sometimes, I get so caught up with this blog in critiquing the middle class financial paradigm, that I forget that people can’t just move from one mental structure to another with a snap of a finger or a series of blog posts. Of course, the Shafer Wealth Academy (www.shaferwealthacademy.com), is designed to get people from one mental structure to another, so I know how to do it, but I am sometimes oblivious to the nature of my audience. This can make me seem to be arrogant, or even worse, clueless. If you read my blog and get that feeling, I only ask you to understand that I am coming from a place that is very different than where you reside!
However, if you are like many of the people who do contact me, and either consciously or unconsciously, recognize the underlying truth in my posts, remember that it takes time to change our mental structures. I am more than willing to help you in that process either passively through my writing or more efficiently by membership in the Shafer Wealth Academy.