The Colibri Money Theory

Theme song: The Money Song

I've been thinking about money for a couple reasons. One is that I'm helping launch Real Money, a social media platform all about money. If you're interested in learning more about money and doing it with the help and encouragement of like-minded people, then sign up for the site (it's free) to get updates as we approach launch.

Although this project has taken a lot of my recent brain power, the (perhaps more important) reason that I've been thinking about money is that I want a dog. You're thinking I could just hop over to the animal shelter and pick one up, but you'd be wrong. My landlord doesn't allow dogs and if I move my rent will be as much as a mortgage. So, I'm figuring out if I can buy a house through one of San Francisco's first time home buyer programs.

In order to qualify, you have to take classes about money -- it's as if when it rains the topic of money, it pours. So far, I've completed 6 hours of course work about money, and now I'm qualified to get (required) money counseling. The reasoning is, people who are educated about money are less likely to experience foreclosures. In any case, the classes are free and I've learning quite a few things I didn't know before that are quite unrelated to dog care.

Now you know why I've been thinking about money, but you'd don't yet know what I've been thinking. Here goes:

Since I love to categorize things, I've created a list of how people earn money and their money mindsets. How people earn money is kind of simple. There are five ways: beg, steal, inherit, work for yourself, or work for someone else. If you want to get picky, we can say it's six ways, and add borrowing onto the list. If you want to get me restarted on the topic of reparations, we can talk about what counts as stealing. Otherwise, I'm calling this list done.

To me, the more interesting thing to think about is money mindsets.

I have identified five. They are:

• Scarcity. This mindset is about fear and lack of control. It can often be about having debt or not having enough money. It can lead to hopelessness and spending binges or an unwillingness to share.
• Abundance. The Abundance mindset is a spiritual mindset sometimes based on the Law of Attraction, or similar. It's about the universe providing you with what you need when you need it. Like scarcity, it's not about planning, and it has no practical elements apart from prayer and ritual.
• Entitlement. Entitlement is the American way. You should have what you want, when you want it. Many people with this mindset focus on earning lots of money so they can spend lots of money. This mindset can create debt and sometimes devolve into the Scarcity mindset.
• Frugality. This is the classic method of budgeting, saving, tracking, and researching before making purchases. It is practical and effective when well-applied, but can lead to an unwillingness to share.

At the end of the day, I didn't like any of these mindsets, so I decided to develop my own. It's called (drum roll):

• Cash Balance. Cash Balance is based in the Frugality mindset, takes its romance and spirituality from the Abundance model, and consciously acknowledges the dark sides of Scarcity and Entitlement. It's all about earning more than you spend, but not being afraid to follow your heart and take risks with money in order to enjoy life more -- or to produce something you wouldn't have if your focus had been too narrowly on the details of money management.

I myself tend towards Scarcity and Entitlement, with not enough Frugality thrown in. I hope that, whether or not I am able to have a dog, that my money classes will have helped me manage my money and better live up to my own ideal of Cash Balance.

Your Turn

What's your money mindset? Did I leave anything off the list?

.