IC E-Lesson: How to Change Your “Money Set Point”

Why do some people seem to go from entrepreneurial project to entrepreneurial project, turning everything they touch into gold, while other seem to struggle to build their real estate business despite having all the apparent advantages?

It’s not brains: some of the smartest people I know struggle constantly in the financial realm, and some of the, let’s say, less intellectually gifted are killing it all the time.

It’s not education, either—a handful of the most successful people I know are high school dropouts, and heaven knows that real estate education is plentiful and accessible to just about everyone.

In fact, I’m pretty sure I haven’t wrapped my head around all the things that rich real estate folk have in common—moxy? Mentors? Risk tolerance? But one thing that the prosperous ones seem to share is an expectation that they will earn a certain (rather high) amount of money.

In researching this on the internet, I discovered that there’s a name for this: a money (or prosperity or financial) set point.

The theory goes that we all, on a subconscious level, have a certain amount of money that we believe we “deserve”, or “should” have. Furthermore, so they say, if we exceed this set point, we’ll (again, subconsciously) begin to do things to sabotage ourselves until we get back to income that feels comfortable to us.

As is usual with these things, there’s some pseudo-scientific explanation built around all of this, but, also as usual, it’s mostly woo-woo “what you think about the universe will provide” stuff.

Only I wonder if it really is.

See, in my experience, people really do have an amount of money that they expect to make, that they think they deserve to make, and that they very often do make. And whether that number is a high one or a low one, they seem to hit it year after year—even as they TRY to make more, WORK to make more, even STRUGGLE to make more.

Since I actually understand enough about the physical laws of the universe to understand that thoughts don’t in fact attract things as if they were magnets and money were steel, I wonder what it is that’s really going on when a $50,000/year middle manager goes into real estate and makes…$50,000 while the $120,000/year MD retires and goes into real estate and makes…$120,000.

It’s not a correlation between how much money they start with—I know several people with what I’d call low money set points who inherited sizable chunks of cash and then basically lost enough of it on bad deals to get back to where they started within a year or two.

It’s also not based on the skills they developed in their former jobs—one ex-contractor I know squandered a $200,000 insurance settlement by over-improving (and losing money on) 3 deals, while another I know, who had nothing to start with when his company crumbled, is consistently netting the same $150,000 a year in his new rehab business as he did in his custom-construction business.

Here’s my theory: we all have an amount of income that feels about ‘right’ to us. When I say right, I don’t mean that we LIKE it, or that we wouldn’t like to have MORE: I mean it feels comfortable, like a well-worn shoe.

Even if we struggle to survive on that amount of income, it’s a struggle that feels normal. Not GOOD, but like something that we understand and know how to deal with.

And for that reason, we DO things that get us to that amount of money, but RESIST things that would get us to more money than that.

So for instance, if your money set point is around $100,000 a year, and you get to that amount in September, you might think, “Yay, I’m going to make $125,000 this year!” But what might actually happen is:


  • You find yourself unable to put any deals under contract for the rest of the year. On closer examination, an outsider might observe that you’re putting off looking at good prospects until they’re sold (because you get busy with silly things), or that you’re forgetting to include all the necessary addenda when you send in offers on REOs (even though you’ve done it a hundred times before)
  • OR, you might suddenly discover that you’re presented with no deals for the rest of the year that are “good enough”. You nitpick every property you’re presented with to the point where you decide that you’re not interested (even thought you’d want it under other circumstances), or you make an offer that’s so much lower than you usually would that you have no chance of getting it accepted. You spend 3 months completely confused about why there are suddenly no good deals in the world—and then in January, they suddenly reappear
  • OR, you might get a deal under contract, but drag your feet in contacting your private lender until you realize that he told you he’s going to Europe for a month, starting tomorrow, and it’s too late to close by the drop-dead date, so you lose it.
  • OR, you do several more deals, make the extra $25,000, but then your computer dies and you realize that you really need a new $25,000 server/computer system/printer/copier package, thus ending up netting your usual $100,000 for the year.

More likely though, you’ll simply do the same $100,000 in deals—but it will take a whole year, not 9 months, to achieve.


If you don’t see yourself in this—and I’ll tell you, most people DON’T, even when other see it in them—ask yourself if you’ve seen it in others. I bet you have.


So the real question is, if I have a money set point, how do I find out what it is, and then how do I change it?


The answer to the 1st question is simple: figure out what you’ve made, net, in the past 2-3 years, whether from real estate, another business, or a job. It’s probably around the same amount each year—and that’s probably your set point. And it’s important to know this, because without knowing it, you can’t move that number upward.


The answer to the 2nd is tougher, because “deciding” to change it isn’t enough. We’ve all, at one time or another, “decided” to make more money. We’ve set goals to make more money. We may have even “visualized” or created “affirmations” around making more money. So if deciding were enough, we’d all be making millions.


Not being a psychiatric professional, I can’t say that I have THE answer in terms of how to change one’s money set point (or, for that matter, whether it really exists!), but I can tell you from my coaching experience that it’s gonna take at least a 3-pronged approach:


  1. Identify the big “why” that makes it worth it to you to do what needs to be done (see #3) to make more money than you ever have in your life. “I want to be rich” isn’t a good why; nor is “I’m sick of being broke”. If you don’t have a real “why” to pull you toward the goal of raising your money set point, the anchors that are holding you back (see #2) are going to be difficult to overcome. Perhaps you have a passion for something that more money would make you more able to do. Perhaps you have a strong desire to support something that’s important to you—a cause, future generations of your family, whatever. Or maybe what you REALLY want to do doesn’t pay well, and a high income from real estate will allow you to do it without worrying about the money. In any case, this “why” will not be something you DON’T want—avoidance of (poverty, embarrassment, loss, whatever) will never be a strong enough “why” to pull you toward the goal of financial success.


  1. Identify—honestly—the thoughts and feelings that are holding you back from making more money. Do you feel guilty about making more than your friends, who all work difficult 60 hour a week jobs to barely scrape by? Guilty about making more than your spouse, who sees him/herself as the breadwinner? Anxious when money comes in? Afraid you’ll waste it or lose it? Regretful and judgmental about the way you’ve treated money in the past? Judgmental of people who make or have a lot of money? Do you have some fear about money, like that it’s an uncontrollable or incomprehensible force that will do as it pleases, no matter what you do? Does it stress you out to think that you might have to work a lot harder to make a lot more money? You’ll have to let these things go, or you’ll self-sabotage every single time there’s a chance that more money will come into your life.


And, by the way, where did these feelings come from? Try to remember the FIRST time you felt them, and what was happening at that time. For me, it was when I was 7, and my parents were fighting about money. My mother was convinced that they would have to file bankruptcy, while my father kept insisting that they were actually quite wealthy (though all on paper). This left me with both a fear and the distinct impression that money was an unknowable thing—that it was possible to think that you were doing fine but be on the verge of bankruptcy at the same time.


  1. Now let that go. Those feelings you have about money are just that—feelings. They’re not facts, they don’t exist in the real world, they aren’t the truth about what money is, how it behaves, or whether you deserve it. Imagine yourself blowing up those thoughts and feeling with a burst of light, or abundance, or the help of God, or whatever lets you get rid of all of that and move forward.


  1. Identify where you WANT your money set point to be, and how what you’re doing will have to change in order for you to reach this goal. Will you have to do more deals? Do better deals? Do different deals? Break it down—if you’ve never made more than $50,000 in a year in real estate, and you want to make $60,000 this year, how many more of the type of deals you do does that mean? How much more marketing does that mean? How many more hours per week does that mean?

Trying to change your set point without examining what it is, why it is what it is, and what’s stopping you from making that money now is, I believe, useless. Deciding to change it, then not actually DOING anything differently, is, in my opinion, magical thinking.

You’re worth more, as measured in money, than you think you are. If you can just convince YOUSELF of that fact, you’ll probably find that you can be as financially successful as you’ve always dreamed.




Leave a Reply

Your email address will not be published. Required fields are marked *