[42] Limiting Money Beliefs, Money Coaching, Market Crashes, Underearners Anonymous and Liquidity Mining


written by oz chen

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Edition 42 personal finance newsletter behavioral investing tips

Compliment of the day: You’re coachable.

In this edition I cover the top limiting beliefs that stop someone from investing. Then I talk about how I’m offering my expertise as a Money Coach(!), Market Crashes, Underearner’s Anonymous and Liquidity Mining.

🤯 10 limiting money beliefs that stop you from investing

“I have extra cash to invest…but I’m not good at investing.”

Sound familiar? attached to that are also beliefs like “I’m not good with money,” or “Investing is too complicated for me.”

I wrote a biiiig post on 10 of these beliefs, along with a myth buster action to conquer each toxic belief.

[Read] 10 Limiting Beliefs That Stop You From Investing

Working with beliefs, emotions and mindset around money are a few of my special sauces. That’s why I’ve decided to offer money coaching.

💪🏼 I’m offering money coaching. Here’s how I help

In the past year that I’ve dedicated to writing about money, a new personal mission has emerged: help people feel a sense of ease and power around money. I do that through the lens of personal development, helping people:

  • Identify beliefs and thought patterns that hold you back from living a financial life.
  • Break down financial goals (and problems) into digestible actions
  • Create an investment approach that feels clear and automatic

I’ve been a career coach for years, helping students land six figure tech jobs. Now I’ll translate all the knowledge I’ve learned about behavior design, psychology, mindfulness and goal-setting to guide people through their personal finance problems.

Here are the details:

  • Who’s in: I will schedule 1:1 sessions for the first 5 people who respond to me with the phrase “Money Coaching” and a brief description of what you’d like help with.
  • Time commitment: will last 45 min to 1 hour
  • The promise: You’ll feel financially understood and walk away with an easy action plan that’ll make a meaningful impact in how you manage your financial life.
  • Deadline: Respond to me by Wednesday, December 15th.

How much will this cost? The first five who respond to me will get a money coaching session at no charge in exchange for your feedback. I’m still defining my style as a financial coach and this is why I’m happy to make this offer, even though my coaching rate is usually $250/hour.

If you or someone you know could use money coaching, send them my way. Thanks in advance!

💥 Market Crashes Are Free Financial Classes

With Omicron fears, inflation and something something supply chain, the market has taken a deep drop. A lot of the darling Covid stocks like Zoom and Peloton are down 30%+.

I don’t advocate for active trading, and recommend treating investing like a passive game. It’s harder to practice passive games because there’s less things to do. But every major dip that comes along represents a learning opportunity to train your psychology when your portfolio has lost money.

Some questions to train the mind during market downturns:

  • If months ago I said “I’d buy X thing if it got cheaper,” then shouldn’t I consider this a discount?
  • Is there any reason to sell my if my opinion about this stock/or asset hasn’t changed?
  • Aren’t these market cycles just cycles?

Whenever there’s a crash, the change in price attracts attention, then creates fear and uncertainty. This also creates free financial training. These are the times when real investing experience is gained; not when everything is green and positive.

😓 Addicted to…Underearning?

In my research on money beliefs, I stumbled upon a support network called Underearners Anonymous. This immediately piqued my curiousity – “X Anonymous” meetings are usually 12 step programs for alcoholics and sex addicts. Can someone be addicted to…underearning?

Psychotherapist Paul Sunderland thinks so. In a TedX talk he defines underearning as compulsively not generating enough money, despite having the ability, desire and opportunity to.

Underearning is considered a financial disorder, likened to the “anorexia” of earning. Mel Magazine breaks down common symptoms of underearning.

  1. Time Indifference: Procrastinating and failing to use your time wisely to support your visions and further your goals. In UA, this is also called being “time drunk.” 
  2. Idea Deflection: Compulsively rejecting ideas and advice that could expand your career and increase your income.
  3. Exertion/Exhaustion: Habitually overworking, becoming exhausted and then under-working or ceasing to work completely, often for little or no pay. 
  4. Undervaluing and Under-pricing: Undervaluing your abilities and services and being too afraid to ask for adequate compensation. 
  5. Misplaced Guilt or Shame: Feeling uneasy or fearful when asking for or being given what you’re owed. 
  6. Not Following Up: Failing to follow-up on opportunities, leads or jobs that could be profitable. Beginning projects and not completing them. 

Underearning helps me understand the fear of success, which has always been less clear to me than the fear of failure. “If I’m visible, I’ll be vulnerable.” It’s a fear of taking up space, owning one’s value, and being seen.

If this feels relevant, check out Underearners Anonymous to see if they have meetings near you.

⛏ DeFi concept: Liquidity Mining

Every time I’ve set a market order on an exchange like Robinhood, it’s gone through without friction. It made me wonder—is there really someone on the other side always ready to make the trade with me?

Nope. To support the ability to buy or sell any time, exchanges use market makers. These are third party institutions (banks) who are always willing to buy and sell assets. Market makers make money on the “spread” between bid (highest price a buyer is willing to pay) and the ask (lowest price a seller is willing to sell).

  • If market makers didn’t exist for centralized exchanges, you may want to buy a stock at the current price, but there’s no individual on the other side willing to do that exact trade. Your money is less liquid now.
  • Market makers, in this sense, provide liquidity for any given market.

DeFi (decentralized finance) flips this on its head. The whole point of DeFi, and arguably crypto, is to cut out middlemen. Using a DEX (decentralized exchange) like Uniswap, anyone can essentially be a bank by providing liquidity to the exchange. A user would provide the exchange a cryptoasset like Ether or USDC. This is called staking.

  • If you provide liquidity, you are a liquidity provider (“LP”) or essentially a market maker
  • Multiple individuals providing liquidity to an exchange create liquidity pools
  • Liquidity providers earn fees from transactions, which are distributed proportionally to everyone in a liquidity pool

DeFi is not only bankless, but it enables any individual to become a bank.

This is why DeFi is so freakin’ interesting. Crypto is much more than just investing in random cryptocurrencies or flipping JPEGs. The ability for any one person to become a bank in the decentralized world will be a profound theme that continues to play out.

I’m experimenting with liquidity mining on platforms like Cake DeFi. If you’d like to read more about DeFi concepts like this, let me know.

Just for fun: A restaurant worker was dancing to Loco after closing…then a customer suddenly came in and saw her. That golf clap tho! Link to video:

Friendly reminder: First 5 responders get free money coaching. Respond to me by Wednesday, December 15th with the phrase “Money Coaching” and a description of the financial topic you’d like coaching in.

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