Is a scarcity mentality keeping you broke?

The cause and how to overcome it

Agatha from The Wealth Tribe
7 min readJul 3, 2020
Photo by Bram. on Unsplash

A few weeks back, I wrote an article on what wealth means to me. One of the items on my list was having free time ‘ just sitting, without having to worry about the next meal.’

I wrote that “growing up in poverty meant that when you sit to ‘relax’, the first thing that comes to mind is the worry. Worrying about the next meal, next paycheck, debt. I want the luxury of free time. Time to just sit and fully relax. To truly enjoy the value of deep rest and the health benefits that come with it. To just sit and reminisce about the good times. Free time to sit with my thoughts and to meditate without feeling like I’m on another person’s schedule. The most important being free time to think. To strategize. To think about the meaning of self-actualization.”

And because I’m always on the lookout for writers who write similar pieces and who honestly talk about money, this week I came across an article by Rutger Bregman titled ‘ why do the poor make such poor decisions?

I immediately judged the article by the title. You should have seen me rolling my eyes thinking that this was going to be another piece by a white person lecturing us about how we’re to blame for being born in such circumstances.

It turned out to be one of those insightful articles that you bookmark to read several times in future and Rutger Bregman turned out to be a Dutch Historian and author. His book Utopia for Realists now on my most wanted list.

The article, which you should read after you’re done reading my mini-stories that I’m about to share, explores the cognitive effects of living in poverty.

One of the mindsets covered is the scarcity mentality. The first insight from the article that got me thinking is…

Scarcity narrows your focus to your immediate lack, to the meeting that’s starting in 5 minutes or bills that need to be paid tomorrow. The long term perspective goes out of the window. — Rutger Bregman

The root cause…

Scarcity mentality or mindset is the constant feeling that you will never have enough. This can be money, food, love, anything…and this mentality starts in childhood. What you do or how you think always stems from a place of lack.

One of the days I’d dreaded most while in primary school was the second week of the school term. During this week, the Deputy Principal would go round the classes with a list of names of those of us who hadn’t paid their school fees. I was always on the list. In fact, I’d start putting my books away in preparation as soon as she walked in. Being on the list meant that you’d have to spend the rest of the day or week, depending on how fast your parents can raise the money, seated in the playing field, while the rest went on with their learning.

There was this boy in my class who was also always on the list as well. We’d sit together in the field and talk about our struggles, but we mostly laughed about who stood up faster when the Deputy walked in.

While still in primary school, I spent a lot of time fantasizing about how it’d feel if I owned a pair to Bata Toughees (haha, Kenyans will get this). That was also an indicator of wealth to me when I was a child.

The legendary Bata toughees

I hated going to church on Sundays because all the other kids in our church were always well dressed in nice shoes and beautiful, new clothes. I relied on hand-me-downs and it was quite a life-draining experience to watch other kids show up every Sunday in nice clothes and shoes.

There was this one time we had a Sunday school trip. We were to stay over at a hotel for the weekend. I showed up dressed in some blue wide flared pants that I thought were cute and couldn’t wait for everyone at church to see me. The kids teased me that they were pyjamas. It took a while to recover from the embarrassment.

Let me not get started on fancy pens. Okay, my primary school was mostly for the elite. We had these kids who had pens in all colours. Pens with feather and fur tops. Highlighters in all colours. Erasers in the shape of our favourite cartoons.

I could tell more stories, but let’s save there rest for subsequent articles.

Of course, these experiences contributed greatly to my relationship with money and my scarcity mentality that was full-blown as soon as I started making money.

Lack of school fees and missing school days? I’m an avid reader hoarder of books (no regrets on this one!) and I’m constantly enrolling in new courses. It’s usually a constant fear of not knowing enough and not sounding intelligent. This has also led me to procrastinate on a lot of projects because I’m always very judgemental on myself. I wonder if this struggle is unique to me…

Lack of clothes? Buying more clothes and shoes than I needed was one of the reasons I got into debt. I’d buy for both now and to fill the childhood gap. At one time in my adult life, I thought about buying a pair of those Bata toughees and hanging them on the wall in my house, just to prove I could afford it. Lol! I know.

It’s like a game of a never-ending hole that we try to fill, but no matter how much we put in, we still feel insufficient while still not experiencing concrete progress.

Scarcity mentality hampers your long term financial goals. You are so focused on spending and borrowing money for here and now that you never get to think about your future.

Even with a job and a monthly income, scarcity anxiety about your finances such as paying debt, paying your bills and short term saving contributes to your scarcity mentality. It’s literally an impaired mindset.

We behave differently when we perceive a thing to be scarce. Scarcity impinges on your mind. — Rutger Bregman

So as much as you may want to save and invest and experience the magic of compounding of your money, if you don’t work on this mindset, you may never move away from brokenness. Or may take longer for you to finally get to a point where you’re no longer worried about the next dollar.

Scarcity consumes you. You’re less able to focus on other things that are also important to you. — Eldar Shafir

The most disturbing about the findings of Rutger Bregman’s book is that the mere thought of a major financial emergency impairs people’s cognitive ability. Yes! You lose clarity of thought and up to 13 to 14 IQ points!

Poor people have an analogous problem. They’re not making poor decisions because they’re dumb, but because they’re living in a context in which anyone would make dumb decisions. — Rutger Bregman

How do you overcome a scarcity mindset?

Seeing that this a deeply embedded challenge, I don’t have a mega solution. When I read the book, I’ll be sure to share with you if it covers the solutions. In the meantime, here are the few tips that have worked for me.

1. Adopt an abundance mentality

Acknowledge how much you already have as opposed to what is missing in your life. If you constantly think about what you’re missing, you’ll find yourself always wanting to upgrade your life without a concrete plan or budget.

Be grateful for the good tidings that life has offered you while you progressively work towards creating a better future.

As Rich Dad Poor Dad by Robert Kiyosaki teaches us, instead of always saying ‘I can’t afford that’ ask yourself ‘How can I afford it?’ Then go ahead and work towards it.

2. Operate on a budget

Budget will literally prevent you from making dumb financial decisions based on what your mind is constantly reminding you that you lack.

3. Which stories do you tell yourself?

It’s one thing to accept your past and to tell your stories but it’s a whole different game to use them for your own defeat.

4. Declutter

A lot of people who have a scarcity mindset are hoarders. They have clothes that can’t fit them, but won’t let go. Let go of stuff that no longer serves you.

6. Environmental design

Your environment influences the quality of your thoughts, your spending habits and ultimately, the quality of your life. Read more here.

7. Sort out your inner voice from all the outside noise.

Get to know what’s actually right for you at a given time in your life. It will help you feel so much better about living your life on your own schedule.

The scarcity mentality will lead you to overspend as you try to keep up with others. Jealousy, as opposed to your priorities, is usually your financial guide.

Avoid comparisons, the people you’re comparing yourself to might be suffering from a worse case of the scarcity mindset.

8. Constantly revisit your goals and what wealth means to you

I shared mine here which will help you come up with yours.

9. Clap when others win

One of my favourite poets, Nayyirah Waheed, has a beautiful poem on this.

Some people when they hear upon hearing

Use other people’s success as inspiration, not as competition. Don’t fuel your feelings of inadequacy.

10. Get 1% better with money every day.

Here is a guide on how to do it.

People who are stuck in a scarcity mindset often never invest because they’re afraid of losing their money. How else will you make money if you don’t invest?

Originally published at on July 3, 2020.