Your Mindset and Your Money

48 comments on “Your Mindset and Your Money ”

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1. Drowsy M. Kram 1

   18 January 2023 at 2:09 pm

   Thanks for an eye-opening post – it's good that nice Mr Fowler has such laudable goals.

   Assuming all Kiwis want and are to be 'wealthy', where does Fowler imagine the extra 45+ plates, or the tens of millions of rental properties, are going to come from?

   
   https://thespinoff.co.nz/society/16-08-2022/the-side-eyes-two-new-zealands-the-table
2. SPC 2

   18 January 2023 at 2:35 pm

   I am not surprised to see such an apologetic, given we have rebuilt the class system down under.

   More people now own their homes in the UK than in New Zealand, and while the rate is rising there, it is still falling here.
3. bwaghorn 3

   18 January 2023 at 3:06 pm

   I think instead of rubbishong the guy and pulling out the poor Maori card, pick through it for the obvious lessons , educating students on money and finance would help.

   Mindste is part of it, I've missed a couple of opportunities because fear took over, and failed miserable financially due to not being taught basic money sense.

   Thank God for Saint cullens kiwisaver as in 10 years it got me to halfway of the average Joe's wealth.
   • Jimmy 3.1

     18 January 2023 at 4:18 pm

     I definitely think educating school children about money / difference between debit and credit cards and best ways to use them/ budgeting / mortgages / Kiwi saver etc. should be compulsory at school. That way when they go out in to the world they at least have a basic understanding of finance.
   • BAW 3.2

     19 January 2023 at 12:29 pm

     Nat voter here.

     Kiwisaver was the best policy of the 5th Labour Government.

     My wishlist to Labour – change the minimum wage laws so all workers get a payment to Kiwisaver.
     • bwaghorn 3.2.1

       20 January 2023 at 1:29 pm

       Have you ever noticed it usually the left that makes things better,the right being conservative hate it until it sinks in .
4. tsmithfield 4

   18 January 2023 at 3:18 pm

   A friend of mine (who died a few years back) had made himself extremely wealthy largely through mindset. I will explain how at the end of this post.

   He had a goal to be retired by the age of 30, which he achieved. His definition of retirement was, that retirement means you work because you want to work, not because you have to work.

   He had started doing a computer degree at Uni after leaving school in his teens, but at the same time was working full-time at the freezing works, using notes from friends to do the Uni work (he was extremely bright).

   He built up enough deposit to purchase his first commercial property a year or two later, and then geared up on the existing property to purchase another as the tenant paid off the loan, and the value of the property increased.

   At the time of his death, I think he owned around 10 commercial properties that were paid off. So, he had huge amounts of rent rolling in to his bank account. Plus he had done very well on the share market.

   The sad thing is, he never really enjoyed his wealth. It was almost like he had a mental sickness. For instance, he would walk down to the library to read the paper rather than purchase one, still had his Datsun 120y which he had purchased new back in the 70s, and which he ended up deregistering because he thought he could just bus everywhere. And, he used to wear old jerseys with torn sleaves etc.

   The outward appearance was that he was a bit of a hobo, when in fact he was worth millions.

   When he developed symptoms of his illness, which turned out to be liver cancer, his doctor could have offered him a test that would have uncovered the issue much earlier. But, the doctor didn't offer it because he assumed my friend wouldn't be able to afford it. He was very bitter about that up until the time of his death about 10 years ago.

   The mindset part of how he got wealthy was:

   • He started with a clear vision of where he wanted to get to.
   • He was prepared to do what was necessary to reach his goals.
   • He didn't waste his money on unproductive things.

   He also thought anyone should be able to do what he did. However, I don't think everyone would be willing to live his lifestyle.
   • Jimmy 4.1

     18 January 2023 at 4:06 pm

     Smart man did well for himself. Sad that he did not get to enjoy the fruits of his labor. I can admire a person like that who sets goals and plans to achieve them and takes the initial risk.
     • tsmithfield 4.1.1

       18 January 2023 at 4:55 pm

       Yep, even when he was dying he didn't do anything with his wealth.

       For him, making money was more like a game. He got pleasure from making the money rather than spending it.
   • solkta 4.2

     18 January 2023 at 4:28 pm

     So from savings after living costs from three years working in a freezing works plus a year or two of what ever he did after that he saved enough for a deposit on a commercial property? I call bullshit on that. Did you leave out some of the story?
     • tsmithfield 4.2.1

       18 January 2023 at 4:46 pm

       No. The deposit required back then was only about 10%. It would be much harder to do that with commercial property these days because the banks want about 40% now, mainly due to banks losing money on commercial property due to a sharemarket crash or two in between times.

       But, it would be more doable with residential property.

       And he started with a fairly average property.

       And, as you can see from my first post, he wasn’t prone to spending much money.

       He much preferred commercial property though because the yeild tended to be better, and costs such as rates and insurance are covered by the tenant.
       • solkta 4.2.1.1

         18 January 2023 at 5:10 pm

         I still call bullshit. Did you leave out living at home with wealthy parents? Help with the deposit?
         • tsmithfield 4.2.1.1.1

           18 January 2023 at 5:17 pm

           His parents were average. We all lived in the same town in Rangiora back then. So, I knew them fairly well.

           He was just highly motivated. II don't know if he was paying board to his parents or not.

           But, the Freezing works did pay quite well back then, and I think he paid about $120k for the property. So, at 10% deposit on that would have been about $12k saved over three years.

           I often used to drive past him as he was biking from Rangiora to Kaiapoi each days (probably around 15ks). So, he definitely wasn't spending much of his money.
       • Descendant Of Smith 4.2.1.2

         18 January 2023 at 5:15 pm

         Unless he had a family back then he may not have been able to get residential mortgage. Commercial in fact have been his only option.
5. arkie 5

   18 January 2023 at 4:20 pm

   https://twitter.com/killerguerilla/status/1614027330342502400
6. Tony Parker 6

   18 January 2023 at 4:23 pm

   I think this response from Emily Writes sums it up.
   • Patricia Bremner 6.1

     19 January 2023 at 11:51 am

     Tony, excellent comeback!!.
7. gsays 7

   18 January 2023 at 4:30 pm

   Mindset, a wonderful euphemism for feeling guilt free for having a bigger share of the pie when others will have to make-do with less.
8. tsmithfield 8

   18 January 2023 at 5:00 pm

   Rich people who live poor, as I described my friend above, are not particularly unusual.

   A lot of these people get rich by being wise and frugal with their money. I think it can end up becoming a life habit for them, despite the wealth.
9. Descendant Of Smith 9

   18 January 2023 at 5:12 pm

   You can argue it is true to a small extent. I certainly could have been very wealthy if I had wanted to through generous offers of property in the 80's from neighbours and friends who were selling up. However philosophically I'm committed to the notion that you only need one house to live in and that I will never live off the efforts of someone else's labour through rent and I declined all those offers – and some were very generous.

   So yep that is a mindset.

   I could be earning a lot more, and in fact have done, if I hadn't stood up to injustice in various workplaces that resulted in non-promotion, dismissal and demotion. That is a mindset. Or I could have not had kids, or not wasted my hours playing cricket and rugby, or not get married and so on. Doing those things are too a matter of choice and mindset.

   What he says is a simple truism that is almost sociopathic in nature and conveniently ignores a lot of reality as well.

   I have family members who have done and could be earning a lot more now if they hadn't been raped by men and had to spend – and are spending years in recovering both physically and mentally. Same goes for those that have had serious accidents. I have very well off family who have had seven inheritances including from spinster and war-widowed aunts. I have family who were dispossessed of their land by the state and others who were institutionalised. I have some that were born in isolated areas with few jobs and others born in productive urban areas and others who were left to raise young families after their husbands were killed in car accidents..

   Equally brains are clearly different – some of us are good at maths and language – others struggle with it but can pull a car engine apart and put it back together. Others have intellectual disabilities and mental health issues..

   The reality of peoples lives has had a much greater impact on who in my family is wealthy and who is not compared to the miniscule influence of mindset.

   This without even considering more strongly genetics vs nurture and structural societal systems favouring predominantly white males (past and present).
10. barry 10

    18 January 2023 at 5:48 pm

    So a rich guy notices, that one's attitude to money is influenced by how much or little of it one has.

    If you have nothing then money is purely a means of getting the necessary for survival.

    If you have enough you might think about saving for retirement.

    If you are rich then naturally money is something you invest.
11. pat 11

    18 January 2023 at 5:57 pm

    Success to the successful…nothing new there….and nothing permanent either
    • Descendant Of Smith 11.1

      18 January 2023 at 6:09 pm

      Is having lots of money the measure of success?
      • pat 11.1.1

        18 January 2023 at 6:53 pm

        In our current paradigm, yes….whether we agree with the measure or not.

        And we are all inclined to it….we dont deliberately buy products we know are inferior, nor do we engage services we know are substandard….at least we dont after the initial mistake.
        • Descendant Of Smith 11.1.1.1

          18 January 2023 at 7:26 pm

          Most don't have those choices and the market well knows it can make more money off selling inferior product to poor people than it can selling quality product. Many people every day buy inferior goods because it is all than can afford – and well they know it.

          Terry Pratchett's boots theory sums this up perfectly.

          The "boots theory" comes from a simple piece of dialogue in Pratchett’s 1993 novel "Men at Arms." The book features a City Watch commander named Capt. Samuel Vimes. The captain is set to marry one of the richest women in the world, and he often opines about the differences between low-status and high-status spending habits.

          At one point in the story, the captain ruminates:

          The reason that the rich were so rich…was because they managed to spend less money.

          In reference to the captain, the quote continues:

          "Take boots, for example. He earned $38 a month plus allowances. A really good pair of leather boots cost $50. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about $10.

          "Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.

          "But the thing was that good boots lasted for years and years. A man who could afford $50 had a pair of boots that'd still be keeping his feet dry in 10 years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet."

          This was Capt. Samuel Vimes' boots theory of socioeconomic unfairness.

          .
        • pat 11.1.1.2

          18 January 2023 at 10:21 pm

          Conversely "boots theory" proves the opposite….the quality goods are not successful (due in the given instance, to price) and therefore do not proliferate.

          The fact they are perceived as unaffordable is the failure….aka unsuccessful,
          • Descendant Of Smith 11.1.1.2.1

            19 January 2023 at 9:29 am

            Yeah because a free and balanced consumer informed supply and demand market rather than conscious deliberate maximum profit making seeking strategy drives pricing.
            • pat 11.1.1.2.1.1

              19 January 2023 at 9:37 am

              AKA economies of scale.
              • Descendant Of Smith …

                19 January 2023 at 1:22 pm

                lol.

                You know I was referring to this sort of behaviour.

                "Think about pricing. What has every telco in the world done in the past? It's used confusion as its chief marketing tool. And that's fine," said Gattung in a speech recorded on March 20.

                "You could argue that that's how all of us keep calling prices up and get those revenues, high-margin businesses, keep them going for a lot longer than would have been the case.

                "But at some level, whether they consciously articulate or not, customers know that's what the game has been. They know we're not being straight up."
      • tsmithfield 11.1.2

        18 January 2023 at 8:10 pm

        “Is having lots of money the measure of success?”

        I don't think it is the greatest measure of success at all. Wealth is obviously a measure of financial success. But I don't think that is the most important thing in life at all.

        I think the greatest measure of success is how people do in their relationships, how they bring up their children, and what they can input into the lives of others.

        If wealth comes with that, then great. And some people do seem to be gifted in accumulating wealth.
12. Mike the Lefty 12

    18 January 2023 at 6:27 pm

    My Dad always used to say: "You can't make an honest million".

    Allow for inflation and you could say: "You can't make an honest billion".

    He was right.

    People don't get rich from working hard.

    They get rich by ripping off other people but of course they always deny that they do that.
13. tWiggle 13

    18 January 2023 at 7:03 pm

    When I was a teenager in Wellie in the 70s, Bob Jones was considered a bit of a cheat as an entrepreneur, as he did nothing concrete or creative to make his pile. He established no factories and opened no new export opportunities, created no new jobs. He just sat on his bum planning his speculation portfolio.

    Somehow since then, speculation has become confused with entrepreneurship. Land speculation sucks capital away from truly entrepreneurial companies and drives rent and land inflation. A loss for creative companies, a loss for the country and a loss for us. Fowler and Bob Jones are no capitalist heroes, just scrooges.

    [Please use the correct e-mail address in your next comment, thanks – Incognito]
    • Incognito 13.1

      18 January 2023 at 8:37 pm

      Mod note
14. tsmithfield 14

    18 January 2023 at 7:27 pm

    People often think that wealthy people have some huge starting advantage over others, such as inherited wealth or whatever.

    However, I think the reason for the mindset suggestion from the rich guy mentioned in the article, is that this often isn't the case.

    I have already pointed out my friend who built up a deposit for his first commercial building by working in the freezing works for three years after leaving school.

    Now I want to talk about one of my sons.

    My son left school quite early as that didn't really suit him. He worked in several jobs, and ended up working for a powder coating firm.

    The guy who was running the business was hopeless at business and should probably have never been a businessman. My son had a number of good ideas that would have helped the guy succeed. But his problem was that he was too far gone at that point, and ended up going bankrupt.

    Another guy had a lease to buy arrangement over the equipment of the business. He could see my son (19 at the time) had some good clues, and was a good worker. So, he offered my son to take over the finance arrangement on the equipment.

    We also knew our son had a lot of great qualities. So, we helped him out with $20k for working capital. Not nearly enough. But, anyway, he launched out in his own business at the age of 19.

    He had a couple of really hard years where he wondered if he was going to make it. But, now, 10 years on, he has an incredibly profitable business, around $750k sitting in his company bank account, is debt free, and a house in a new subdivision.

    One key to his success is that he realised that price wasn't the critical factor in that type of business. The powder coating cost is normally a small fraction of the cost for a customer. Customers tend to be much more concerned that the powder doesn't flake off, and that they can get their work back when they need it.

    So, my son focussed on job quality, and him and his team occasionally worked through the night to get an order out for a customer.

    Now he has major difficulty fitting in all the work. He is taking over the lease on the next door building and is expanding. He pays his staff incredibly well for the industry they are in, and pays them large end of year bonuses.

    In my son's case, admittedly, he did have a small amount of help from us. But, key to his success was a bit of luck, vision, determination and stickability, and a strong focus on customer satisfaction.
    • Muttonbird 14.1

      18 January 2023 at 7:43 pm

      Your whole comment falls to pieces after claiming success is not dependent on starting advantage, then admitting you did provide starting advantage.

      What seems a small amount of help to you is not possible for most of the population, both in terms of "inherited wealth or whatever", and the ability to recognise an opportunity.

      This is an issue of self awareness on your part and the rest is simply virtue signalling. I think awareness is one of the main qualities right wing people seriously lack.
      • tsmithfield 14.1.1

        18 January 2023 at 7:56 pm

        But it wasn't the determining factor of his success. Perhaps he would have found another way if we hadn't helped. Its not like we gave him millions or anything. Most of the success was down to him.

        And, as far as I know, my friend who built up a large property portfolio didn’t have help from anyone.

        I don't think that this sort of outcome is possible for everyone. Some people have so much dysfunction in their lives that it is a major inhibition to their success. Other people just don't have such an opportunity fall in their laps, and others are too cautious to take up the opportunity if it does come along.

        But I think it is a valid point that it is a lot more to financial success than inherited wealth or whatever. People who start off like that tend to be arseholes, and are often likely to lose it all because they have never had to work for it.
        • roblogic 14.1.1.1

          19 January 2023 at 12:47 pm

          The are other forms of advantage – like a supportive family, good health, socialised in good values, being white, social networks, success in relationships, security from thieves
          • tsmithfield 14.1.1.1.1

            19 January 2023 at 12:58 pm

            You are assuming being white… but that is true.

            As I pointed out below though, people achieve in lots of areas by overcoming all sorts of obstacles, including not being able to read or write as I pointed out below.

            Sure, it is hard, and probably a lot more fail than succeed. But, I guess the point I am trying to make is that we shouldn't place limits on people and end up holding them captive to their disadvantages.

            There is a balance to be struck between that and supporting people in their difficulties.
15. Sanctuary 15

    19 January 2023 at 8:13 am

    The only thing I would observe is that in my opinion it is a bit of a myth that New Zealand is one of the most entrepreneurial countries in the world. Our regulatory environment might support this view but the reality is most New Zealanders would see Graeme Fowler as the type of "entrepreneur" they would wish to emulate.

    The chief aim of NZ settler capitalism is to be a rent seeker and speculator, make your fortune, then retire to wherever suits your tastes within the rich world to enjoy your rentier income in the style of the absentee landlord and vulgar nouveau aristocratic class everywhere.

    Certainly, going to bank in NZ and asking for an unsecured loan for an idea you have would more likely see the bank calling security to escort you from the premises than them giving you the loan.

    It is a colonial mindset we simply haven't yet escaped in this country – extract wealth, retire to the mother country. Graeme Fowler is an absolute poster child for this new class of parasitic, rent seeking wannabe aristocrats that was spawned by neoliberalism.
16. Jenny are we there yet 16

    19 January 2023 at 8:26 am

    Man with 80 houses: Capital Gains Tax will hurt renters

    Cos’ he has the mindset and the ‘personality’ and all the power.

    He will make sure it will.

    Bring back the Anti-Eviction League. Get some power back

    https://paperspast.natlib.govt.nz/newspapers/THD19311015.2.78
    • Jenny are we there yet 16.1

      19 January 2023 at 7:30 pm

      EVICTION RESISTANCE – refusing to leave the home when the landlord ends the tenancy – is a strategy used by tenants worldwide both to enable them to keep their housing in the short or long term and to send a message to policymakers about the importance of improving rental conditions. This article chronicles and analyses eviction resistance during the Depression in New Zealand. Eviction resistance ranged from crowds that gathered to support evicted people to carefully organized pickets……

      https://lhp.org.nz/wp-content/uploads/2022/07/03_Chisholm-Article.pdf

      "…..to send a message to policymakers about the importance of improving rental conditions."

      And send a message they did.
17. Mike the Lefty 17

    19 January 2023 at 9:55 am

    Graham Fowler's mindset is that there is nothing more important than money.

    Sad!
18. tsmithfield 18

    19 January 2023 at 10:11 am

    Another example is one of our clients who we used to build Sphagnum Moss Packing machines for a number of years ago, Les Sutton. I understand he has died now.

    Les owned his company, and was very proud of the fact that he had made himself rich despite being unable to read or write. He overcame this limitation by employing people who could compensate for his weaknesses.

    This is another example that shows that mindset is a big factor in whether people can achieve financially or in any area. Sometimes people with many serious disadvantages that could undermine their self-belief can actually achieve far higher than what many would expect.

    I am giving these examples as an encouragement more than anything else. Not just in the financial aspect, but for any area people are wanting to achieve in.

    That is, that people shouldn't just accept the die is cast for them, and they have no hope of achieving. People often can achieve a lot more than they think.
19. Scott 19

    20 January 2023 at 3:55 pm

    I do think that attitude is important to success.

    My father taught me and my brothers to set goal for each area of our lives.

    The best money advice he gave was to say that we had two options

    1) We could trade our time for money, or

    2)We could trade money for time
    • KJT 19.1

      20 January 2023 at 4:25 pm

      True to an extent.

      But the reason most of those who are poor, remain poor is they have neither money, nor time available.

      And for those that have there is still a huge element of luck, unless they have had the, also lucky, benefit of inheriting enough money to have several attempts at a successful business, or to simply collect economic rents.

      Do you think the more than 4 out of 5 attempts at entrepreneurship that fail, are all because they "have the wrong mindset"?
      • Scott 19.1.1

        20 January 2023 at 6:01 pm

        I think that businesses fail through inexperience and a lack of knowledge most often.

        The mindset is to give it a go. Always very positive initially.

        You don't always win but you always learn.

        Most entrepreneurs have failures- I certainly have. But the key is to have a plan and not allow failure to destroy you so you can bounce back.
        • KJT 19.1.1.1

          21 January 2023 at 8:53 pm

          Most people do not have the money or resources to bounce back.

          I did several times. But I was lucky enough to have a good combination of various highly in demand skill sets, courtesy of 1970's education and apprenticeship systems, even though I didn't have much money capital behind me.

          I see the the lack of resources, jobs and training, , available to people of moderate to low incomes more recently, and the miserly benefits and the forcing of people into the first low hours, low paid job available. I am not surprised that "bouncing back" is totally out of their reach.
          • Scott 19.1.1.1.1

            24 January 2023 at 12:17 pm

            Yes agree that many people whose plan fails bet the farm and can't try again.

            I have helped (mainly) young people begin over 100 small businesses over the last 30 years and loved it. Many had little education and no financial resource. Some were on the Police diversion scheme.

            I've learned that capitalism does not necessarily require capital

            Some of those businesses have grown into substantial operations.

            My advice to most young people is to get a job in a mid size company and learn how a business works. A couple of promotions and you get to make mistakes with someone elses money.

            Then develop a plan. Test and measure as much as possible.

            Begin slowly and try to keep your paid job for as long as possible.

            Most people thrive in the process of starting, running and growing their own business. The beginning is often the most stressful period and some choose to go back to working for someone else – which is fine.

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