The difference between financial independence and a life of financial frustration comes down to attitude. The way you approach all aspects of your life, not just money, has a significant effect on your long-term financial growth. Personal philosophies dictate how you act and how you react to any situation you face.

It’s worth the time to take a look at your personal philosophies to determine how they are helping or hurting you. Think about how you view the world and your place within it. Consider the relationships you have with people and the way you make sense of situations.

I didn’t think about this much until I had a boss who encouraged me to take a look at how my own thoughts were preventing me from succeeding. Never being a fan of motivational nonsense, I wasn’t always willing to listen. This was more about delivery than it was about the message itself; once I was ready to accept some criticism of myself, much later, I understood more about what he was trying to communicate.

When I was younger, I tended to look for external reasons when any situation did not work out in my favor. I attributed bad results to things outside my control. For example, if I was late to the office, it was because traffic was worse than I expected. If I was going deeper into debt, it was because I wasn’t getting paid enough by my employer to cover my basic necessities in addition to my costs to transport myself to the office every day. My approach to life required me to believe that many of the bad things that happened to me were brought on by external events, things which I could not control.

Eventually, I came to realize that I had much more control over my life. I learned to accept every moment as a choice, and that I had no one to blame for any bad circumstances but myself. While there are certainly situations that are affected by uncontrollable external forces, but these make up a very small percent of the factors that affect my life.

While I wasn’t familiar with the psychology behind my approach to life at the time, I was shifting attribution. As I’ve read more about attribution theory in the years since the time I started changing my approach, I’ve come to see how the experts have clearly defined the effects of life philosophies pertaining to attribution.

If you do well on a test in school, you can attribute your success to a number of factors. If you perceive your success is due to your effort or your skills, you are likely to have an internal locus of control — you believe that this positive result is the effect of something inside yourself. If you attribute your successful results on luck or ease of the test, your locus of control is external.

It’s a natural defense mechanism to want to differentiate this locus of control based on the outcome. It’s not uncommon, particularly for managers of people to see this among employees who do self-evaluations, for people to focus on external forces when asked about poor results and on internal forces when asked about favorable results.

The feeling that bad situations are the result of bad luck, difficulty, or an external event more specific can make it more difficult to succeed financially over the long term. If you don’t believe the choices you make every day can have a positive effect in your life, there’s no incentive for making better choices. Blaming ourselves for our bad circumstances requires admitting that we’ve made bad choices. Most people want to feel good about the choices they’ve made, so there is natural resistance to accepting responsibility.

I’ve heard these external attributions — and in some cases, the one having these thoughts at some point might have been me.

I can’t get a job because the economy is bad. With companies laying off employees during the recession, this is something I heard frequently over the past few years. The media perpetuate the story that people are having a difficult time staying in their current jobs or finding new ones, and this helps those in the same situation feel like they’re going through a tough situation with many other people.

There’s camaraderie in the unemployed. And that makes it easy to accept that you won’t succeed until the economy improves — you’re just waiting for the statistics like the unemployment figures to be more in your favor. Once companies start hiring again, once consumer confidence increases, once the public wants to buy products again, you’ll have more options.

The best way for most people to reach financial independence over the course of their lives is to be employed at all times. You can’t wait around for the economy to improve. You need to adjust if your particular skills aren’t needed in today’s market. Being able to adapt is one of the biggest factors in your measurement of your human capital, because it means you can meet adversity with the type of thinking needed to survive.

A factory worker can lament the loss of jobs with outsourcing or computerization and blame the government for unfavorable policies or blame corporations for looking to save money. He will do much better for himself if he accepts the fact that the skills he has do not meet the needs of an economy that relies more on technology and has more access to distant locations where a family’s financial needs are not as cumbersome as they are in this country.

The quicker he concludes that he needs to adapt to a changing world, the sooner he can take responsibility for his future and maintain a healthy income that grows into wealth.

I keep getting charged fees by my bank, and it’s due to their policies. Bank of America customers know that their financial institution is always willing to do whatever it can to collect as much income from fees as possible. A recent lawsuit has resulted in the bank giving partial refunds to current and former customers who were charged several overdraft fees in one day.

While the bank’s consumer-unfriendly, sneaky policy that maximized its profit by ensuring overdrawn customers would pay the maximum fee possible, it doesn’t change the fact that only people who were overdrawing their accounts or who were dangerously close to doing so on a frequent basis were the customers who paid the most. Those living paycheck-to-paycheck or worse were most vulnerable. You can blame the bank for the policy that ordered debits from largest to smallest, but this is an approach that will limit your ability to succeed with your finances. Read the policies, choose a better bank, and save your money so your balance isn’t dangerously close to zero.

I’m in debt because of a financial emergency. Being a pedestrian being struck by a moving vehicle is one of the worst things that can happen to someone. Hospital bills for major accidents are one of the biggest causes of financial devastation. Losing a job, helping a family member with her own emergency, and going through a natural disaster like Hurricane Katrina or Superstorm Sandy are other reasons — besides compulsive shopping — that people fall into debt without a mechanism in place to get out.

While emergencies can never be fully avoided, you can be prepared. You can avoid risk by living somewhere that is not prone to weather-based devastation, though that doesn’t limit the possibility completely. You need to have the appropriate level of insurance. That includes automobile, life, health, hurricane, earthquake, flood, disability, long-term care — and enough to cover whatever you might not be able to pay for yourself. You need to have an emergency fund of the appropriate size. With these tools, you can face financial emergencies without jeopardizing your future.

I lost money on my investment. This is one of those cases where people love to look for external reasons for their failure rather their own lack of skill or ability in picking an investment. I’ve seen people absolutely convinced that no real estate purchase is a bad idea significantly overpay for their house and then need to take a significant loss when they needed to sell in the middle of the recession. I’ve purchased stocks I thought would perform well in the short-term, only to find they did not provide the returns I was hoping for.

The list of possible blame recipients is long when it comes to investments gone bad, and here are just a few:

• The market crashed, so it’s just a matter of bad timing or bad luck.
• The company’s marketing — or even lying — persuaded me to make a bad investment.
• I was fooled by Bernie Madoff or some other swindler, who promised great returns amid a tough economy.
• The company’s CEO was involved in a scandal that destroyed the stock’s value.

External forces certainly play a role, but every one of these reasons can easily be turned around to show the investor was at fault. You can’t time the market, so invest for the long-term or put your money in an investment or savings vehicle much less volatile. Don’t trust marketing. If something sounds too good to be true, it probably is. Ask questions if you have concerns. Diversify so you’re not significantly affected by the actions of one person or one company.

That’s just the beginning in terms of taking responsibility for bad investments.

Once you come to the conclusion that the choices you make have a direct effect on your finances, you’ll be in a much better position for building long-term wealth. If only external forces were to have control over our lives, no one would be able to consistently build wealth or the life they want. Give yourself a chance by recognizing the effect your choices have on your success and failure. The correlation might not always be perfectly clear, but accepting responsibility for outcomes that don’t go your way is the first step towards ridding yourself of toxic financial attitudes that prevent you from achieving your potential level of wealth (and separately, life satisfaction).

The idea that “nothing bad is my fault” is the first of several negative attitudes I plan to consider over the next few weeks. How do you accept responsibility or place blame for the less-than-optimal financial situations in your life?

Photo: Flickr

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Time management has never been my strength. Part of my approach to time management is rooted in my disdain for over-organization. I don’t want to treat my time as if I were on an assembly line. For most of my life, however, I was somewhat bound by daily schedules, just like most people. In school, classes began at certain times. While employed, I was expected to arrive at the office and stay there for whatever the boss considered to be normal operating hours.

These are the parameters society expects, and there’s a long tradition behind this type of time organization.

• From the beginning of the idea of toiling to earn wages or working in return for shelter and food, certain activities needed to be conducted at certain times of the day to take advantage of the limited natural light outdoors.
• When workers are organized together to create the manpower necessary for factory-type work, schedules ensured that the group of workers could operate efficiently as one machine.

These conditions that require strict scheduling still apply, but only in a limited number of circumstances. Most middle-class jobs in the United States are no longer bound by these restrictions. There might be other considerations that result in the expectation of a pre-defined work day, like the need for a retail store to be open during what we still consider normal business hours.

I’ve done a decent job through the years of sticking to other people’s schedule — or society’s schedule — when expected, but I didn’t necessarily like it. Time for myself, my extracurricular or extravocational activities that interested me were limited to the evening and nights, when I should have been sleeping. I’m lucky to have had the opportunity to put some of the more structured aspects of my life behind. I found commuting to an office in the morning, spending eight hours, sometimes longer, trading my time for money, not very interesting to me — at least not in the jobs I usually pursued.

It’s no surprise I wasn’t motivated much to improve my time management skills. Doing so would benefit my employer, theoretically, so I resisted this aspect of so-called self improvement. It’s not that I didn’t want to perform at my best at every task, but I did prioritize my life by fulfillment, and I found my jobs lacking in that respect.

Now that I’m working for myself and now that I’ve completed redesigned the way I earn money, with myself having most of the control as a business owner, I’ve begun revisiting my approach. Improving time management now isn’t just a corporate brainwashing attempt to increase productivity — paying employees the same amount for working more — it’s a way to restructure my life so I’m spending more time doing what I enjoy. Eliminating grocery shopping by outsourcing the chore to a delivery service is just one detail in this restructuring.

My work is already something I enjoy, so I don’t have to worry about finding fulfillment elsewhere. Writing online and building communities started when I was young and at school, and gave me something to do with my time. I learned computer programming and built bulletin board systems when I should have been sleeping. In college, I used my hours in the evening or at night to build web sites and worked as a consultant to professors who wanted to build their own vanity sites or class sites. While working a day job, I started writing in the evenings and nights about personal finance. This has all been personally rewarding to me, so I’m thankful I was able to transition to doing these things full-time.

But I do have other interests, and giving myself a schedule to follow helps keep me focused and moving forward. After the success I had using Google Calendar to keep track of my busy schedule during the Financial Blogger Conference, I decided to create a new calendar with daily repeating events to form structure to my day. Outside of the work that I do, I have one other main interest and one goal I’d like to take seriously.

The other interest is photography. Still trying to keep my Consumerism Commentary identity separate from my everyday persona due to the personal nature of a good portion of the historical content on this website, I don’t bring my photography onto this site. I feel, however, that through classes with one of the area’s best portrait photographers over the past few years, my skills have advanced. Some of my work is currently on display in a local exhibit. I wouldn’t consider photography as a career option; the supply of photographers far exceeds the demand. I do, however, enjoy it and if I can make some money on the side it wouldn’t hurt.

My goal is to improve my fitness. I’ve been saying this for a long time, and I’ve had some great attempts at getting fit, but they haven’t lasted long. I even joined a gym last year thinking the monthly fee would be enough to motivate me to visit frequently; it wasn’t.

For the past two weeks, my new Google Calendar with my daily schedule has been integrated into my life. I see it every morning when wake up and look at my mobile phone, and it’s easily accessible when I look at my email and begin writing in the morning. It is, however, somewhat flexible. I don’t micro-manage my own life. I use the calendar to set aside blocks of time. For example, from 8:00 in the morning until noon, I use my time for reading and writing. I read news sources and books, and I write articles for Consumerism Commentary and other websites. I try to grab breakfast during this time, as I can often eat while I read, but I often get distracted by articles and discover it’s noon before I know it.

At noon, I take a lunch break. I’ll usually make a sandwich for myself and eat while watching something recorded from the television. I find that some entertainment in the middle of the day helps me stay mentally refreshed.

In my schedule after the lunch break, I have an hour set aside for going to the gym. As soon as I implemented this schedule two weeks ago, I was able to get out of the house and get a workout, and it quickly became a habit. It has only been two weeks, but I feel I have a better chance of sticking to this schedule now that it is written down and is in front of me every day. I’ve already lost some weight.

So far, I haven’t used the entire hour to work out, so I’ve had some time built in to recover before returning to work in the afternoon. I have another block of time set aside on my calendar — three hours — for answering email and writing more. I also use this time to talk to colleagues, plan new projects, and make use of social media related to Consumerism Commentary.

After this three-hour block of time, I have an hour set aside for photography. This is the one aspect of the calendar I haven’t obeyed precisely every day since establishing the schedule. I’d like to use this time to work on my photography skills but it doesn’t always work out that way. Some days I continue working and others I begin my next scheduled activity, dinner, early. And I often return to work after dinner — a time that is not scheduled on my calendar for anything.

It’s worth thinking about whether it would be better to set aside a longer block of time for photography less frequently, but I can make that judgment and adjustment because for the most part I’m only answering to myself.

The way I’ve devised this daily calendar allows me to have flexibility, a trait of time management that I find important, but also keeps me moving in the right direction.

I still have two specific opportunities for improvement, and there are likely more:

• I’d like to schedule a better time for photography, as I mentioned above.
• I’d like to use some time to change my writing schedule so I’m writing more in advance than I am now.

Part of the reason I can be so flexible is that, as I said, I’m only answering to myself. I am not married, and I have no children. I have very limited responsibilities outside myself. If, for example, I needed to pick up a child from school every day at 3:30 in the afternoon, it would require an adjustment to the way I schedule my day. If my evenings were to include family time, I might need to use more of my evenings and nights to take on what I’m doing today. And of course, having a family shifts all priorities.

What tips do you have for time management?

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