Does Your Money Mindset Make You Vulnerable to Scams?
An off-kilter money mindset may take you down dark paths, as Lynda Moore explains.
2 August 2023
In an increasingly digital world, the threat of scams looms large, and New Zealand is not immune to this problem. Being scammed can have devastating consequences, both financially and emotionally. While we often focus on the tactics employed by scammers, it is important to recognise the role our money mindset plays in falling victim to these fraudulent schemes. In this article, we will explore the connection between money mindset and scams and offer practical tips to safeguard your finances in the unique context of New Zealand.
What is a money mindset?
The term refers to our beliefs, attitudes, and behaviours towards money. It shapes our financial decisions, risk tolerance, and vulnerability to scams. A negative money mindset, such as a scarcity mindset or a fear of missing out, can make us more susceptible to fraudulent schemes.
Common types of scams
New Zealand faces its share of scams, with fraudsters constantly evolving their tactics to target unsuspecting individuals. Prevalent scams include the following.
Online shopping scams: These involve fake websites or sellers who lure victims with attractive deals on popular items. Unsuspecting buyers make payments, but the products never arrive.
Investment scams: Scammers often promise high returns on investments in sectors like cryptocurrency, property, or forex trading. They exploit the desire for quick wealth and lure victims into risky or non-existent opportunities.
Romance scams: Fraudsters create fake online profiles and engage in emotional manipulation to establish romantic relationships. They eventually request money under various pretexts, leaving victims heartbroken and financially drained.
Money Mindsets that attract scammers
Impulsiveness: People driven by impulsivity can be more prone to making quick financial decisions without conducting due diligence. Scammers exploit this tendency by creating a sense of urgency or offering limited-time opportunities.
Fear and scarcity: A scarcity mindset, characterised by a constant fear of not having enough, can lead individuals to make impulsive and ill-informed financial choices. Scammers capitalise on this fear by presenting lucrative offers that seem too good to pass up.
Greed and quick wealth fantasies: A strong desire for quick wealth can blind individuals to the warning signs of scams. Fraudsters play on these aspirations, promising exceptional returns and exploiting the greed of their victims.
How to protect yourself
By cultivating a positive and balanced money mindset, you can focus on financial well-being, long-term planning, and diligent decision-making. Recognise and address any negative beliefs or fears that might make you vulnerable to scams. Shift your focus towards long-term financial stability rather than quick gains.
Embrace careful decision-making and research opportunities thoroughly before committing to ensure they are legit. Just like spending on a big-ticket item when you’re in a shop, pause and count to 20, then re-evaluate.
Stay informed about common scams and tactics used by fraudsters in New Zealand to help foster resilience and self-empowerment, trusting your own judgment.
Protecting your finances from scams requires a proactive approach that encompasses both awareness of scams targeting New Zealanders and a healthy money mindset. By cultivating a positive relationship with money, staying informed, and practising due diligence, you can reduce the risk of falling victim to fraudulent schemes. Remember, your financial well-being is in your hands—remain vigilant, stay informed, and protect yourself against scams in the digital age.
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