I was mystified. It was 1994. I’d begun researching my first book, Prince Charming Isn’t Coming, by interviewing women who worked in the financial industry—investment advisors, mortgage brokers, bankers, etc.
After all, I assumed, financial professionals were the perfect candidates to illustrate the book’s theme: how women went from being ignorant to smart about money.
Believe me, I never expected how many would tell me: “I do this for a living, but my own finances are a mess!”
How could that be?? Decades later I discovered the reason. In a word, Self-Efficacy, or rather the lack of it.
Self-efficacy—a psychological concept developed by the Stanford psychologist Albert Bandera—is the belief that I can do whatever I decide to do, trusting I’ll succeed no matter what.
It’s the difference between knowing what to do and actually doing it, between being highly competent and feeling truly confident.
In other words, you can be quite knowledgeable about finance, like the women I interviewed. But lacking Self-Efficacy—the conviction that you can invest wisely without screwing up irreparably—you likely won’t even try.
Or you’ll stop at the first stumbling block. Or worse, you’ll unconsciously make bad choices that reaffirms your limiting belief.
But, think about how many classes you’ve attended, professional advisors you’ve consulted or books you’ve read that gave you the tools to shore up Self-Efficacy? My guess—zero.
This is why I wrote Rewire for Wealth. By training your mind to replace fear with conviction, self-doubt with self-assurance, you’ll strengthen the neuropathways for Self-Efficacy.
And this, I’m convinced, is the secret sauce for both financial success and personal well-being. So why isn’t anyone talking about it?
Do you have the belief that you CAN handle your finances? If not, what can you do to change that? Leave me a comment below.