What’s your mindset? Abundance vs. Scarcity Thinking - LifeGuide Financial Advisors (2024)

July 11, 2018|Financial Life Planning

Life is a collection of millions of choices that we make daily. While these choices vary in magnitude, they can often be traced back to a source.

One source that plays a significant role in the choices that we make is our mindset.

A mindset has many different facets, but one of the main components is whether you have an abundance or a scarcity mentality.

The Abundance Mindset

An abundance mindset envisions endless possibilities and sets lofty goals. It’s one that believes the best is yet to come, and that ideas, resources, and love are unlimited. It’s a mindset that honors God, and creates a contagious zeal and passion for life! We see this mindset being taught by God throughout scripture:

John 10:10 (NASB)— “The thief comes only to steal and kill and destroy. I came that they may have life and have it abundantly.”
1 Timothy 6:17 (NLT) — “ Teach those who are rich in this world not to be proud and not to trust in their money, which is so unreliable. Their trust should be in God, who richly gives us all we need for our enjoyment.”
2 Corinthians 9:6-8 (ESV) — “The point is this: whoever sows sparingly will also reap sparingly, and whoever sows bountifully will also reap bountifully. Each one must give as he has decided in his heart, not reluctantly or under compulsion, for God loves a cheerful giver. And God is able to make all grace abound to you, so that having all sufficiency in all things at all times, you may abound in every good work.”

We can’t help but develop an abundance mindset as we steadily increase in our personal understanding that our God is limitless, He is for us, and He cannot be contained.

An abundance mindset envisions endless possibilities and sets lofty goals.

The Scarcity Mindset

In contrast, a scarcity mindset sees limitation and shortage at every turn.

It’s a mindset that is easy to gravitate towards and one that needs to be guarded against. A scarcity mindset contributes to an unfulfilled life—one constantly concerned about having enough and others having too much. We’re warned about this in the Sermon on the Mount, where Jesus teaches how we are not to be anxious (Matthew 6:25-34, ESV).

Scarcity thinkers tend to seek after materialistic achievements, such as money, recognition, or power, instead of focusing on life-giving practices like collaboration, generosity, and openness to change.

Fostering an Abundance Mindset

One way that can be helpful in thinking through which mindset you have is by reflecting on how you view different parts of your life.

Do you share opportunities, ideas, your time, and resources? Or are you more apt to keep those things to yourself? Do you find it easy to celebrate when a neighbor, friend, or family member receives a promotion? Or do you tend to feel a bit of resentment, that youare more deserving of a promotion?

Regardless of which mindset you feel you are currently more aligned with, developing a stronger abundance mindset is a wise use of time.

In his article, 6 Tips to Develop and Model an Abundance Mindset, author John C. Maxwell lays out six ways to develop and model an abundance mindset:

Offer words of appreciation
Choose to see opportunity
Remind yourself that there is more than enough
Carefully select the company you keep
Spend time in reflection
Give more of what you want

Viewing the Stock Market with an Abundance Mindset

Having an abundance mindset dovetails directly with our investment principles.

It plays a role in making you a better investor when the market is up and when it is down. The fundamental belief that there is enough to go around helps us combat fear and greed—two enemies of long-term success. An abundance mentality helps avoid irrational decisions, such as taking unnecessary risk by betting on a friend’s “hot stock tip” or abandoning our investment strategy by moving to cash during a down market.

An abundance mindset helps us keep a healthy perspective to endure—and perhaps even enjoy—the market’s ride.

We’ll leave you with a great comparison graphic from Aaron Endré of Endré Communications between scarcity thinking and abundance thinking.

So, which are you? Do you lean more towards scarcity or abundant thinking? What can you adopt today to reinforce an abundance mindset in yourself and those around you?

From Endré Communications

FAQs

What is the difference between scarcity mindset and abundance mindset? ›

Someone with an abundant mentality is an optimist and is genuinely happy for others when they achieve success. Conversely, those with a scarcity mindset are competitive and resent others' success. A person with an abundant mindset understands that change is an integral part of life. They embrace and accept change.

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How does an abundance mindset impact your personal financial position? ›

Those with an abundance mindset believe there's an abundance of opportunities and resources available to them. They are more likely to take risks, invest, and seek opportunities for financial growth.

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What is financial scarcity mindset? ›

In terms of financial decision-making, a scarcity mindset could lead you down two paths — either you're inclined to “hoard” cash (rather than invest it or spend it), or you're tempted to spend, spend, spend (and forego any type of long-term goals or planning).

What is an example of a scarcity mindset? ›

You often worry that you won't have enough food, clothing, other items, people in your life, or time. You fear that you'll run out of money, no matter how much you make or save. You struggle to get rid of items.

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What is an example of an abundance mentality? ›

You genuinely celebrate the success of others who achieve their goals. You give back. People in a scarcity mindset are too busy taking to give back. If you volunteer your time, energy or skills, often give away your possessions or enjoy taking care of your loved ones, you're on your way to having an abundance mindset.

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What is the mindset from scarcity to abundance? ›

An abundance mindset is when you believe there are plenty of resources for everyone. A scarcity mindset is when you believe resources are limited. A scarcity mindset causes hyperfixation, leads to short-term coping instead of long-term problem-solving, and increases jealousy and stress.

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What does financial abundance feel like? ›

What is financial abundance? Definitions vary depending on who you're talking to, but it's generally accepted that financial abundance means feeling like you have enough and having gratitude accordingly. Are you surprised to learn that it's not about having a lot of money? Well, you're not alone.

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What is the root cause of the scarcity mindset? ›

By its very nature, a scarcity mindset is rooted in fear, insecurity, and a lack of trust. Because of this, a person may adopt unhealthy behaviors such as hoarding or overuse of resources. Its effects can leak into relationships and even the workplace.

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What is scarcity vs abundance mindset in business? ›

Risk-taking: Those with an abundance mindset might be more open to taking calculated risks, viewing failures as learning opportunities. In contrast, those with a scarcity mindset might avoid risks, fearing the loss of the limited good they have.

Can you give a real life example of scarcity? ›

Absolute scarcity means limited availability of physical resources. Precious metals, raw materials like uranium, and the growing water scarcity in London are examples of absolute scarcity.

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How do you recognize a scarcity mindset? ›

Here are some signs of a spirit of scarcity: Constant worry about lack. People with a scarcity mind are preoccupied with the thought of not having enough. They worry about running out of money, time, opportunities, or other resources, leading to chronic worry and fear of the future.

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What is the danger of scarcity mindset? ›

Scarcity mentality affects your ability to solve problems, hold information, and reason logically. It also affects your brain's decision-making process. A scarcity mindset limits your ability to plan, focus, and start a project or task. Your brain is too busy thinking about something you don't have.

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What is the difference between scarcity and abundant? ›

Scarcity mindset refers to people seeing life as a finite pie, so that if one person takes a big piece, that leaves less for everyone else. Abundance, on the other hand, is the complete opposite. It is the idea that there is plenty out there for everybody.

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What does an abundance mindset do? ›

What Is an Abundance Mindset? Author Stephen Covey coined the term “abundance mindset” in his best-selling book The 7 Habits of Highly Effective People. According to Covey, to have an abundance mindset is to believe that the world is full of enough resources and time for you to accomplish your goals.

What is the difference between scarcity and abundance in economics? ›

Abundance refers to having ample resources. Unlike the economy of scarcity, the economy of abundance is built on the availability of near unlimited resources. The economy of abundance is almost always present in the digital world—digital products and content are easy and cheap to copy, store, and transfer to millions.

What is the difference between scarcity and abundance leadership? ›

Someone with an abundance mindset likely feels more positive, empowered, confident and focused on serving others. They have opened themselves up to giving generously of themselves and their gifts. Someone with a scarcity mindset may feel overwhelmed, anxious, and frustrated with their life.

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