16th Edition: How Identity, Habits & Compounding Drive Learning

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Hey everyone, hope you’re having a wonder-full week

“Savers are losers.”

Those three words shattered my financial beliefs with the force of a bazooka.

It was a picturesque afternoon in Paris. I had a cup of tea cradled in one hand, and Robert Kiyosaki’s Rich Dad Poor Dad in the other. A book my “star stock-picker” former boss confirmed is “one of the best” on personal finance.

The message sent my mind racing. That and the realization that middle class families fall victim to thinking a house is always a good investment. Evidently that’s not the case. A house is considered a liability on a balance sheet—not an asset.

I quickly learned why.

A bunch of my friends had recently bought houses that began resembling clown cars. Every time an unexpected cost appeared, they’d think there couldn’t possibly be more—then surprise, another one would make itself known. New roofs, windows, furnaces—you name it. Not to mention renovations that ran over budget. Nightmare.

My heart went out to them.

I vowed from that moment to take Kiyosaki’s advice. I wouldn’t take on the liability of a house until I’d secured financial assets.

There was just one problem. I didn’t know how to start investing. So I did a lot of research, attended a couple of informational talks—but ultimately, I got overwhelmed and put it off.

Now I’ve had a new realization. Women are taught to save, men are taught to invest. It’s up to me to educate myself, so that’s what I’m doing. Below are three ways you can do the same (for yourself or your students) in any area you choose.

An experience to inspire: Crypto Cheetahs

I started Crypto Cheetahs yesterday.

A course designed to help woman use Crypto to gain financial independence.

I dug deep in our first exercise. We were asked to bring a journal to class—a rare request for online courses—and I loved it. It spoke to the personal touch of what we were doing together: writing out our self-limiting beliefs about building wealth.

Turns out I have a lot. But my top three—which a number of women shared—were:

1. I’m not from a wealthy family, so I’ll never be able to build wealth.

2. You have to be a CEO—and a damn good one—to build wealth.

3. Starting to invest at 32 is too late to build wealth.

You can’t build on shaky foundation, and learning is no different. Had the instructor jumped straight to how and why to start investing, most of us would’ve been held back by pre-conceived notions.

Instead our instructor is helping us open up new horizons before we mount our horses and set out on our financial quest.

🧠 Challenge: How can you address misunderstandings and gaps students might have about your topic? How can you help students work through them?

A resource to consider: Atomic Habits by James Clear

Compounding works wonders on self-improvement.

The problem is making small, consistent efforts toward a goal is hard. Think of how many people you know who wish they were in better shape but struggle to sustain a diet or workout plan.

Author James Clear shares a brilliant workaround in his book Atomic Habits.

Let’s say you’re a smoker. Gasp, I know—so unhealthy and unheard of in this day and age. The good news is you’re trying to quit.

Now imagine responding to an offer for a cigarette in one of two ways:

1. “No thanks, I’m trying to quit.”

2. “No thanks, I don’t smoke.”

Take a moment to reflect on the difference. It may seem small—but the impact is huge.

In the first scenario, you’re telling yourself “I’m resisting something”. Translation: I’m doing something hard to achieve a desired outcome (no longer being a smoker).

In the second scenario, you’re telling yourself “I’m declining an offer because it’s not relevant to me”. You don’t need self-restraint because you’re acting in line with your identity (a non-smoker).

Clear calls these “outcome-based habits” (unsustainable when an outcome feels out of reach) versus “identity-based habits” (sustainable because they’re aligned to who you are).

Visual comparison of two types of habits from Atomic Habits by James Clear

You can be anyone you want to be. The hardest part is boldly embracing new identities. But once you do that, you can form identity-based habits that propel you toward desired outcomes.

Take me for example. I could approach my goal of building wealth in two ways:

1. Establishing a financial goal and making daily sacrifices to that end.

   Sounds hard, right?

2. Stepping into a new identity: a wealthy woman.

   Are my finances exactly where I want them to be? No. But as long as I identify as a wealthy woman, I will consistently make smart decisions about my finances that feel beneficial to me now (even though the results will come over time as my efforts compound into outcomes).

These options may not seem all that different. But the former would be a long road of waiting to feel successful, which risks eating away at my discipline, increasing my chances of giving up, and me winding up feeling like a failure.

Talk about an unnecessary spiral.

Instead I’m opting for the path that makes me feel successful in my daily efforts. Life is far more enjoyable that way.

🎯 Challenge: How can you help students embrace new identities? How can you help them create identity-based habits?

A question to ponder: Setting yourself free

Half the battle of achieving goals is breaking out of the mental prisons we self-impose.

I can’t do it. I’m not good enough. I’m not ready. I never will be.

The worst kind of lies are the ones we tell ourselves.

Source: lexicon

💭 Question: What’s a self-limiting belief that’s holding you back from reaching your potential? How can you work on releasing it?

Thanks for reading my sixteenth newsletter

My goal is to prompt reflection within this vibrant community of ours, so I’d love your feedback on how I can make future editions beneficial.

Got an idea or burning question I could address? Hit reply and we’re off.

Have a wonder-full week,

Alexandra