There are a lot of reasons why we have trouble sticking to good habits or developing new skills that could help us improve our life. But more often than not, the biggest obstacle to change is sitting right inside of your own head.

Your mind is a powerful thing — and it controls your life a lot more than you probably realize.

A “mindset” is defined as: a fixed mental attitude or disposition that predetermines a person's responses to and interpretations of situations.

In other words your mindset — made up of your beliefs, thoughts and expectations — is the lens through which you see and experience the world. It tells you how to react and respond to situations, as well as how to interpret them.

We all tell ourselves stories about our life — what we’re capable of being, doing, having, achieving and more. Your mindset, or how you view and experience life, is shaped by this internal narrative you tell yourself on a daily basis. And whether you’ve noticed or not, this is the same narrative that you’ve likely been telling yourself your entire life.

When it comes to changing your financial reality — and really any part of life — your mindset plays a major role. It’s what tells you whether change is possible or impossible — and as a result, it can set you up for, or prevent you from reaching, the level of success you desire.

A quick anecdote for the skeptics

Your beliefs become your thoughts,
Your thoughts become your words,
Your words become your actions,
Your actions become your habits,
Your habits become your values,
Your values become your destiny.
-Ghandi

If your first reaction to this quote is what a bunch of baloney, I get it, because I used to think the same thing.

One of my best friends is a mindfulness-based psychotherapist and I spent years telling her she was full of $#%! — at least that’s what I was thinking when I would nod my head and try to act interested in whatever she was saying about inner growth or healing or something about the universe.

Frankly, I thought it was just a bunch of hooey and an easy way to trick unhappy people into paying out the ass for a chance to discover their inner truth, which in my mind was something that didn’t really exist. To give you an idea of what I’m talking about, here’s a sampling from her blog:

Connection to self is the portal for inner healing. By tapping into our strengths, increasing our self-care and embracing sacred stillness, we become more empowered to recreate the life we want to live by healing from within.

Our perpetual busyness can narrow our lens of life, thrusting us into mind states where we hone in on the negative circumstances of our existence. As the seasons change, step back and widen your lens. As you continue your life's journey, accept dead ends that detour you towards paths in which you needed to travel. Endings are merely detours you were meant to take. Release what's no longer serving you while honoring the fear of unknown terrain.

What a bunch of garbage I’d say to myself. My “lens” was just fine. I had a great job, a great life and I created my own success through hard work — not by just connecting to my “inner self,” whatever that meant.

So, how was that mindset working out for me? Not so great. I was living paycheck-to-paycheck, using credit cards for things I couldn’t afford and was making zero progress toward my bigger goals. I was so focused on making sure things looked great on the outside — that I appeared in “total control” of things — that I reached a point where I was totally unsatisfied on the inside. My life wasn’t progressing and I was stuck — not just financially, but overall. The truth is, I was too afraid of facing my reality, because I was afraid of failure. Until I realized that the longer I put it off, the longer I would continue living a life that didn’t bring me satisfaction.

So I finally decided it was time to make a change. I had to challenge my way of thinking — my internal lens or outlook on life — and adjust my lifestyle to be aligned with my values and what I actually cared about. I finally took a step back to figure out who I was — the beliefs, values and passions that truly make me happy. I figured out what mattered to me so I could then figure out what I needed to do to live the life I had always dreamed of. Yes, figuring out “who you are” is a process. But if you can begin to become more aware of what you want in life and your goals, you can start to make a plan to get there.

I was able to let go of worrying about what society told me about how things should look and what other people thought. Because the truth is, people think very little about others because they’re so focused on thinking about themselves. No one was paying attention to my spending habits and no one would notice if I missed out on a few things, so why did I feel the need to “keep up”? Changing my money habits wasn’t failure, it was recognizing that I wasn’t on the path I truly wanted to be on — and doing something about it. Challenging my existing mindset and creating a new one freed me up to focus on my priorities and goals in life — and what I needed to do in order to achieve them.

When I took a step back to challenge my way of thinking and whether or not what I was doing was helping me reach my goals, it opened up an entirely new perspective. I was finally able to understand all the BS my friend had been preaching for years. Her message was simply about taking the time to acknowledge the path you’re on and identifying what needs to change. Letting go of things that perpetuate an unwanted cycle isn’t failure, it’s freedom to start the journey you truly want to be on in life. She just said it in a fluffier way.

Where your mindset came from and how it impacts your life

We don’t see things as they are, we see them as we are.

We do not see our beliefs, but rather our beliefs tell us what to see. This was Ghandi’s point — your beliefs, whether or not you’ve acknowledged what they actually are, are driving your life. And this is why it is so crucial that we take the time to discover what our beliefs actually are — and whether they are helping or hurting us when it comes to getting on the path to reaching our goals.

Over time, our life experiences form the basis for our set of beliefs and expectations — including those about ourselves and the world around us. This belief system is typically shaped by our parents, other family members, relationships, past experiences and more. So in order to discover whether your beliefs and way of thinking are actually your own, and not those of your parents etc., you must challenge this internal narrative you’ve been telling yourself for years. Because as Ghandi so eloquently put it, your beliefs and expectations influence your behavior — and ultimately, they shape your destiny.

When you grow up believing that money is the root of all evil and that you shouldn’t expect to get whatever it is you want in life, then you will probably spend adulthood believing exactly that. Maybe you grew up in a household where this belief was perpetuated often or experienced an event in which money created a pretty crummy situation — these are ways a belief like this gets implanted in your mindset.

If you think, believe and expect that you will never be rich — because maybe you grew up poor and were told as a child that it just wasn’t in the cards for you — then very likely, the way you live your life will fall right in line with that philosophy. And as a result, that limiting mindset causes you to lose out on opportunities to make more money and get what you want in life, simply because your mind won’t allow you to see those possibilities. It isn’t in the cards for you. So you stop trying to make it a reality.

Our internal narrative is shaped by a lifetime of experiences and it’s fueled by evidence we find all around us. Whatever we tell ourselves, we look for evidence to prove it to be true — i.e. a fixed mental attitude that predetermines a person's responses to and interpretations of situations.

The way your life looks is a direct result of the stories you tell yourself (and were told by others) and what you believe is possible. If you believe you aren’t good enough, you’ll find plenty of evidence out there to prove yourself right. When we tell ourselves something over and over, we begin see it all around us. It’s all our mind allows us to see. It’s just part of being human. My perfectionism told me for years that nothing was ever good enough. Rather than recognizing that something was great, I saw it as not perfect — and it took me a long time to realize how big of an impact that mindset was having on my life.

Unless we make a conscious effort, we don’t see things objectively, we see them through our own personal lens that has been fogged by past relationships and experiences in life, as well as the beliefs that we ourselves have continued to perpetuate. On one hand, this lens is meant to protect us — to help us avoid making the same mistakes twice. But on the other hand, this same lens can also limit us greatly by adding our own subjective filter.

Many people who grew up poor believe they don’t deserve to be rich, because that’s what life (and likely the people around them) has taught them for as long as they can remember. But that’s ridiculous — there’s plenty of money to go around and anyone can be rich if they’re willing to do what it takes to get there. But in order to set yourself up for that kind of success (which is also subjective), you have to be aware of what it is you tell yourself every day. Millionaires who came from nothing believed they deserved to be rich as much as the next guy — and that mindset motivated them every step of the way.

When you think I can’t get a higher-paying job, you limit your opportunities to those you believe you’re qualified for, when you could probably qualify for much better positions. But since this is what you believe to be true, you don’t look for — and in turn don’t get — a higher-paying job.

When life doesn’t seem to be going your way — financially or otherwise — it can be difficult to really believe in yourself and your potential. But what makes it worse are all of things that you may not even realize you tell yourself on a daily basis.

Start to become aware of your thoughts and beliefs about yourself, money and life in general. Regardless of where you are or where you’ve come from, forgive your past. Whenever I have trouble letting go of something, I always tell myself, “you can’t write the next chapter of your life if you keep re-reading the last one.”

So let’s start rewriting your story.

How to change your mindset, and ultimately, your life

If we can learn to believe something, we can also learn to un-believe it — it just takes practice.

Change is difficult because it requires challenging what has become your natural mindset — the thoughts and beliefs that very likely have been there for as long as you can remember (or can’t even remember). The truth is, changing the story you tell yourself is far from easy, which is why so many people are stuck going through life on autopilot — because it’s easy, familiar — and most of all — it’s comfortable. There is no real work involved. But consequently, there is also no real change.

Changing your mindset isn’t like flipping a switch. Your internal narrative has been shaped over the course of many years, and you can’t just turn it off in an instant. Reshaping your mindset about life, yourself and what you’re capable of takes practice. It takes telling yourself a new story over and over everyday until one day, it becomes your natural outlook on life.

What we tell ourselves sets up the entire framework for how we see ourselves and the world. Constantly thinking I should this and I should that sends the message that what you are actually doing isn’t good enough. Sure, maybe you could improve some things, but you likely don’t frame it that way in your head.

Rewriting your internal narrative

The answer isn’t to ban yourself from thinking “negative” thoughts — that’s just dumb and impossible. Instead, try to become aware of your thoughts — constraining and limiting things you tell yourself on a daily basis — and then replace them with more effective ones.

For example, telling yourself I should be saving money can easily give you a negative perception of yourself because maybe you aren’t currently saving. On the other hand, telling yourself I want to save money (and thinking about why) can give you the motivation you need to start doing it.

A few common thoughts about money that create a limiting mindset:

• I don’t make enough money to save.

• I’ll never be rich, so why even try?

• I’ve made too many mistakes to fix things now.

• I’ll never get out of debt.

• Money really isn’t that important.

• Saving stops me from experiencing life.

All too often, limiting thoughts and beliefs become exactly what keeps people from getting ahead financially. These beliefs not only bring you down emotionally, but they also very often becomes self-fulfilling prophecies.

When these thoughts dominate your mind, you begin to truly believe that you will never be able to make more money, you lose confidence in your abilities, and eventually, you stop dreaming big. These thoughts have created a reality in which you are sure that you aren’t capable of accomplishing what you want in life — and so you never do.

Think about it this way: would you ever tell a teenager that she’ll never be successful?

Didn’t think so. So stop telling yourself that.

Once you decide to change what you tell yourself, it’s not hard to change the way you think about money.

Here are a few ways to rephrase those limiting thoughts to make them more effective in your life:

• I make enough money to save xx amount.

  • If you buy anything that is not the necessary food, shelter and clothing you need to live, then you make enough money to save. How much you save just depends on what you’re willing to sacrifice in order to give yourself a better life.

• I want to be rich and xx is what I’ll need to get there.

  • The concept of being rich is relative. You just need to decide what it is that you want and then start making a plan to get there. Here’s a guide to help get you started.

• I’ve made too many mistakes to turn things around now.

  • This is just an excuse. And the sooner you stop telling yourself this, the sooner you can turn things around!

• I will need xx amount to get out of debt.

  • People get out of thousands and thousands in debt every single day. Saying you’ll never be able to get out of debt is just an excuse for not wanting to do what it takes to pay it off. When you rephrase this thought into one that gives you a plan of action, it will become a lot easier to make the necessary changes in order to make it happen. Here’s a guide to help you start digging out of debt.

• Money allows me to afford the things I want in life.

  • Let’s be real. Everything requires money and therefore, money is important. Unless you want to be Mother Theresa, you need money. And if you’re reading this, then it’s safe to assume you want more money. So start telling yourself about all of the good things in life that money CAN buy — and use that as motivation to start turning things around. Here are 40 things you can do today to take control of your financial life.

• Money gives me the freedom to do what I want to do, when I want to do it.

  • When people say they’d rather “experience life” than save money, they’re just making an excuse for being irresponsible and not wanting to actually take control over their own life. The truth is, there is no rule that says you can’t experience everything you want in life and save money at the same time. You just have to prioritize what you really want. Because if you don’t, you’ll end up sacrificing what you want in the future for all the things you thought had to have now.

When you start to take control of what’s going on inside your mind, you can begin to reshape your reality and create a life experience based on your priorities and personal values.

And the sooner you change your mindset, the sooner you’ll reap the rewards of a financially successful life.