Recently, I’ve been learning a great deal about how finances work. It’s a difficult topic, and that’s mostly because there are a lot of people out there with a vested interest in misleading you or even outright lying to you. Let’s be real – I could be one. But I’m just a regular Joe (not my real name!) who has decided to become more familiar with the world of finances, and I thought I’d share with y’all what I learn. Now let’s be clear: this is not financial advice. I’m not qualified for that. But maybe I can at least help with the right mindset.

Precept 1: More information is always better, especially when it comes to your personal finances. How closely you have to hew to a budget is a function of how stable your financial situation is, but even knowing how much you’ve busted the budget for a month is very valuable. First you have to take an honest and unbiased look at your finances before you can start making good decisions. When you’re first starting, you can even make a budget that you have no intention of keeping to. How you busted it is still a valuable thing to know.

Precept 2: How you handle money is directly tied to your mental health. This is a tough idea to get one’s mind around, so let me put it a different way: the way you approach money and finances can expose mental issues you weren’t aware of. That’s why having more information is important, as I mentioned above. You’re, indirectly, starting to understand how your mind works. This is also, though, why you need to show yourself some grace, particularly as you get used to the process.

For me, for example, I found that I have a particular aversion to risk. It causes me fear. I was able to trace that back to a few events in my past. I can’t honestly say I’ve dealt with them, but by understanding them I can take a more healthy approach to risk. That could lead to my losing some money, but it’s worth it to be able to deal with those issues.

Precept 3: Anything that appears to be too good to be true, is. Ever since Facebook figured out that I’m interested in investing, etc., they’ve been tossing a lot of products at me. Some of them actually look really appealing at first glance. But as I looked closer, I realized that they were either snake oil or had some significant downsides that were being glossed over. Sometimes those downsides are hard to see, which leads me to the next precept:

Precept 4: If you are careful, people trying to sell you something can be a free source of significant education. I have one guy right now trying to sell me some kind of investment life insurance. He made his pitch, and it was quite attractive. So I said “thanks, we’ll be in touch”, asked someone else for their opinion, sat down, and did my homework. Ultimately I’m likely to pass, but because of all that homework and research, I’m in a significantly more knowledegable place than I was a few days ago. And not only was the education free, the guy was chomping at the bit to give it to me.

You have to be careful with this one, though. It requires the correct mindset, which is: first, taking the seller seriously. If you’re just playing him or her, that’s not respectful. Second, doing your research with the specific idea of finding the flaw(s) in whatever the person is selling. There are always flaws. Once you find them, you can have a back and forth addressing those flaws, and that’s where your education comes from. And thirdly, you have to be prepared, or even predisposed, to decline. You’re trying to punch holes in it, not get suckered in. If, after doing your homework, you still find it attractive, go for it. But you’re in it, first and foremost, for the education.

For example, with the investment product the guy I’m talking to is selling, it can be attractive and has significant upsides – but not for my particular situation. It took me a while to figure out why, but once I did, it was clear as day. It’s not for me.

Precept 5: this is the most important precept: it’s all about mindset. There is a mindset for being in poverty, there is a mindset for getting along, and there is a mindset for making money. They are not the same mindset by any means. It’s a matter of priority. Getting out of poverty can be very, very difficult. I’m not meaning to diminish that. But changing your mindset is the way towards accomplishing that. If I had to give a single word to what the difference between those mindsets are, it’s “intention”, and the other word would be “choice”. Those in poverty do have significantly fewer choice, but there’s choice nonetheless. Is your intention to make your situation better? Is your choice to make your situation better? If so, then you’re going to make your situation better. It just takes a bit of time and making good (and maybe somewhat unconventional) choices. Which leads me to the next precept:

Precept 6: Don’t be afraid to shake the box. This one’s maybe the hardest because it’s really hard to think outside what you’re used to. But if you don’t like the choices you have, you have to create different ones. Sometimes that’s a lot harder than other times, but it’s always possible. For example, I don’t like crypto, and I don’t trust it. But I bought a few hundred dogecoins anyway. Is that a good investment? Probably not. I might lose it all. But it might take off too. I made a measured choice I wasn’t entirely comfortable with, knowing it may not pan out, but also knowing that it might lead to a good outcome in the future. I shook the box.

And shaking the box might take other forms as well. It’s mostly about creating a choice where there didn’t seem to be one previously. But it requires some creativity, a lot of knowledge, and a good mindset.

Precept 7: It’s all psychological. Money is a manifestation of collective psychology, and nothing more. Understand how it works, and you already have a leg up, because probably ninety percent of the players who think they understand this, don’t. Always Be Learning. Learn what makes people tick, learn why they make the decisions they do, learn why you make the decisions you do, and learn how to not be taken in by a collective delusion. You do that, generally, you win.

It’s hard. All of this is hard. I’m not going to pretend to have mastered any of it, I’m fairly new myself. But, as Scott Adams would say, it’s systems, not goals. Understand how it all works, learn more about it, decide what you want to accomplish, and nothing will be closed to you. The more you learn, the more you understand, the more you put into practice, the more measured and deliberate you are, the more you’ll accomplish.

But the first thing you gotta do is change your mindset.