CHAPTER 4
Self-Esteem and Its Influence on Wealth

What lies behind us and what lies before us are tiny matters compared to what lies within us.

—Henry David Thoreau

The day Tony Cupisz saw that shining black limousine, he began to realize that he wanted something different for his life. He had not yet found his dream, but by taking small steps, he started to climb out of the hole of negativity and low expectations that life had presented to him. He started to change his life.

The Road to Freedom

“I wanted more. I wanted freedom,” Tony explains. He knew that would mean having a career. When he left school, he began to look for a path that interested him and that could earn him a good living. He had heard of the concept of residual income from a friend’s dad who was in insurance sales.

“I loved that idea—the work you do now continues to pay in the future,” Tony explains. “My friend’s dad was successful, and I wanted this thing I’d heard him talk about. I thought the concept was great. You sold health insurance to companies and helped them save money, and you received a small percentage each month. I really liked the thought of getting a check every month for work I had done once—you do it one time, and you get paid over and over.” Tony laughs when he recalls, “I didn’t even know what health insurance was at the time, but I liked the sound of it. Residual income represented freedom.” A seed was planted. Years later, Tony and his brother Mike would build their futures and their fortunes on the concept of residual income.

Tony asked his friend’s father if he could work for him. With the dad’s assent, Tony got his start in sales. He got a desk and a phone, and he went to work selling insurance on straight commission. Now he had not only a job, but a mentor. “I was 19 years old, and I was at a very low point in my life: no money, no prospects—not good at all. My friend’s dad lent me a series of audiotapes by Tom Hopkins called How to Master the Art of Selling. He gave them to me to teach me how to be a salesman.

“This tape series was a combination of motivation and sales instruction. It teaches how to control a conversation, how to answer questions, how to present. On the very first tape, the first thing Tom Hopkins said was, ‘I was 19 years old, I was depressed, and I was broke.’ That was exactly the situation I was in: I was 19, I was depressed, and I was broke! So the minute I heard that, I identified with him, and I started listening to those tapes every moment I could. I listened every day, every day, every day.

“As I listened, I discovered that success was all a matter of your mind. Listening to those tapes was important, because it allowed me to hear a human being actually say, ‘You can be better, and here is how.’ I really needed that. Right then I started rebuilding myself. I started learning how to be more positive. I was studying the psychology of success and the psychology of wealth, and I was learning about my own potential.”

As Tony practiced what he was learning, he found that his confidence grew. Of course, he realized that nothing was going to fall from the sky. He had to do the work and remain open to the possibilities.

“At first, I listened only to that Tom Hopkins series,” he said. “It taught me all the basics of communication. And I applied what I was learning. Every day, as I was prospecting and selling, I practiced what I heard on the tapes. When I could talk to a grown man and he listened to me, I started gaining more confidence. Another thing that helped me build my self-esteem was seeing other people who were confident. Simply knowing there were people like that, I thought, ‘It can be done.’ Next, it was: ‘How do I get there?’”

To help him learn how to take his next step toward success, Tony began exploring another tape series, The Psychology of Achievement by Brian Tracy.

“The psychology aspect helped me because it was all about how to think and why we think the way we do. I didn’t realize it at the time, but those tapes were doing more than teaching me the psychology of success. It was like going to a psychologist. It enabled me to understand my whole life and why I felt the way I did. I suddenly realized that throughout my life, the wrong stuff had been going into my brain, and I could change that. I understood that I was talking to myself negatively, rather than how I should be talking to myself, with positive statements. I started changing the way I was thinking and the things I did. I listened until I could almost repeat the entire tape series. And I continued to apply what I learned every day.”

Tony was so excited about his discoveries that he wanted to share them. “Every day, I would tell my friends, ‘You’ve got to hear this stuff. We can actually be successful. We can actually do this.’ And my friends would laugh at me, because here I was, a 19-year-old listening to motivational tapes. They told me to shut up and put music on. They called me Aristotle, making fun of me because I was listening to this philosophical stuff.”

But through the tapes and books, Tony was surrounding himself with personal coaches. “The other things I read that helped me were How to Win Friends and Influence People, by Dale Carnegie, and Napoleon Hill’s book, Think and Grow Rich. Those four authors helped me with a combination of motivation, positive thinking, and communication skills—how to listen, how to talk, how to relate to people better. They gave me something I could use every day. And it worked. Step by step, I started to climb out of the hole. It saved my life.”

Tony’s friends had—perhaps inadvertently—gotten it exactly right. If Aristotle were alive today, he just might be making motivational tapes of his own. As this wise man said in the fourth century BC, “First have a definite, clear, practical idea—a goal, an objective. Second, have the necessary means to achieve your ends—wisdom, money, materials, and methods. Third, adjust all your means to that end.”

How Do We Create Self-Esteem?

Perhaps more than anyone else I spoke to in the course of writing this book, Tony was revealing that, at its heart, the psychology of wealth is a psychology of self-esteem and self-respect. While our culture often considers wealth to be the accumulation of money and assets, true wealth and prosperity hinge on these important psychological intangibles. Fortunately, the steps that we must take to create a prosperous life are most likely the very ones that will ultimately create self-esteem, self-worth, and self-respect. Tony’s daily practice—putting into action these powerful ideas that were new to him—was critical to his success. By the way, as we’ll learn later, there’s even more to Tony’s story. And the twists and turns to come have more to add to an understanding of the psychology of wealth.

How exactly are self-esteem and self-worth created? Far too often, money has a disproportionate influence on our sense of self-worth. People frequently believe that if they could somehow acquire more money or more assets, they would feel wealthy. Some believe, for example, that if they received a raise, they would finally feel good about themselves. An individual with this notion who has struggled financially or has failed to meet a financial goal may feel diminished. Over the years, I’ve seen this struggle in some of my clients—including affluent ones. They feel that something inside them is missing, and that if they only had a bigger house or could afford a more expensive school for their children, they would at last gain entrance to the charmed circle of the truly okay. Yet with each new purchase or rise on the ladder of worldly esteem, the inner void remains unfilled. Although it may seem paradoxical, beliefs like these hold us back from prosperity and prevent us from achieving our highest potential.

It is easy to associate a sense of belonging, worthiness, and security with financial success. Our society both shouts and whispers this association, from the heights of the Fortune 500 list to the depths of our collective psyche. When we know that we can meet our basic financial needs, some types of personal uncertainty are definitely eased. But eventually we discover that simply having a lot of money does not provide inner security or a sense of worthiness. While money helps many things, it has little long-term impact on our self-worth.

Psychologist and wealth counselor Szifra Birke observes, “Money tends not to solve personal problems; money solves money problems.”¹ Birke also reports that many financially wealthy people are actually burdened by a vague sense that they don’t deserve what they have. Our view of our worthiness seems to hinge in part on how we came by our financial gains and whether we have worked for them in incremental steps. Feelings of unworthiness are especially common in folks who suddenly or unexpectedly come into a large sum of money, such as through an inheritance (or, as we’ve seen, through a lottery win). They commonly experience “sudden wealth syndrome”; with the acquisition of financial riches, they feel lost and overwhelmed. If you base your self-worth on whether you have reached a particular rung on the ladder to wealth, and if you define wealth by the things you have, an endless loop of dissatisfaction and self-defeat may be the result.

It would be difficult to create financial wealth or any measure of true success without having an intact core sense of self. If you believe that having money will bestow on you a sense of self-worth, you will be caught in a classic Catch-22 loop in which self-esteem must be preceded by wealth, but wealth is possible only if you have self-esteem. Indeed, financial wealth does not automatically confer either self-esteem or self-respect. On the contrary, self-esteem and self-respect seem to be prerequisites for achieving a life of true wealth and prosperity.

The psychology of wealth is a psychology of self-esteem and self-respect.

The Immune System of Consciousness

Self-esteem is a fundamental human need. We simply cannot thrive without it. When we have a solid sense of self-esteem, we feel strong and confident of our ability to cope with life’s challenges, and we are able to function at a high level, with a sense of control over our lives. We can expect a measure of success because we know we are capable of being effective.

Psychologist Nathaniel Branden describes self-esteem as a vital combination of two qualities: self-confidence and self-respect. Indeed, self-respect may be the most essential component of self-esteem. With self-respect, we see ourselves as being worthy and deserving of happiness, achievement, and love. Branden says, “I think of self-esteem as the immune system of consciousness. A healthy immune system doesn’t guarantee you’ll never become ill, but it does reduce your susceptibility to illness and can improve your odds for a speedy recovery if you do get sick. The same is true psychologically. Those with strong self-esteem are resilient in the face of life’s difficulties.”² People who are comfortable with themselves and their achievements take pleasure in being who they are. They face each new challenge with a few deep breaths and a measure of confidence that they’ll succeed. As they achieve each new goal, their self-respect grows—and, with it, the ability to fulfill their potential.

When our basic human needs for self-esteem and self-respect are not met, we give up easily, blame others, strive for less, and often fail to achieve our goals. Arrogance, self-righteousness, manipulation, and boastfulness actually betray low self-esteem, primarily in extraverts. Such behaviors are futile attempts to compensate for a sense of unworthiness. Other signs of low self-esteem are a tendency to criticize oneself heavily and to habitually feel dissatisfied with one’s performance. For introverts, poor self-esteem may be manifested as an excessive desire to please others and a reluctance to say no out of fear of causing displeasure. Because of an exaggerated fear of making mistakes, people who lack self-esteem avoid taking risks. These unfortunate tendencies sabotage success, acting like internally constructed obstacles to achieving a fulfilling and prosperous life.

In short, creating a psychology of wealth requires a hardy and healthy sense of self-esteem. With it comes a willingness to put oneself on the line and make whatever efforts and stretches are necessary in order to move forward.

One Step at a Time

What if you don’t have the self-esteem required to create the life you want? This is where the good news comes in—for the steps that we must take to achieve prosperity are the same steps that increase and strengthen our confidence and self-worth. Indeed, the process of creating a prosperous and successful life is actually the same process that is needed to build self-esteem—one step at a time and one goal at a time.

Robert Reasoner is someone who knows a thing or two about self-esteem. Past president of the National Association for Self-Esteem,³ he is a former school administrator and the developer of a model for measuring and building self-esteem that has been adopted by schools throughout the United States. Reasoner asserts that true self-esteem “comes from accomplishing meaningful things, overcoming adversity, bouncing back from failures, assuming self-responsibility, and maintaining integrity.” He continues, “Some have referred to self-esteem as merely ‘feeling good’ or having positive feelings about oneself.” This incomplete understanding, he says, has stemmed from some popular but incomplete strategies for building self-esteem that include heaping children with praise that isn’t based on accomplishment. “Any efforts to build self-esteem,” Reasoner says, “must be grounded in reality.” It is not possible to grant another person an authentic and durable sense of self-esteem—it is a quality that we gain through our own experiences.

It is not possible to grant another person an authentic and durable sense of self-esteem—it is a quality that we gain through our own experiences.

As Tony Cupisz’s experience demonstrates, another effective way to build self-esteem is by raising our awareness of how we think and by making a conscious habit of replacing negative language with positive language when thinking and speaking about ourselves and others. Surrounding oneself with positive messages and with successful and happy people are powerful methods for increasing one’s sense of self-worth.

Simply by being alive, we are worthy. If our sense of self is damaged, battered, or fragile, it can be strengthened. Self-esteem is something that we can learn and build upon. And one of the best ways to learn it is by doing. The way to create self-esteem in ourselves is through accomplishments. When we accomplish something that is even somewhat difficult, creative, or challenging, we demonstrate to our harshest critics—ourselves—that we are capable. These accomplishments can be small. Yet as long as we realize them, even if we occasionally fall on our faces in the process, we experience our own capacity to achieve and to develop inner strength and tenacity. Going through this step-by-step process is the most powerful thing we can do to build our own self-esteem and self-respect.

In fact, occasional failures and stumbles may be among our best teachers on the path to self-esteem. Many studies, specifically in the past decade, have shown the potentially strengthening effects of adversity. Human beings have an innate resiliency that can turn challenges and setbacks into opportunities for growth. That is why it is so important that we do not beat ourselves up at any point on the path to success and prosperity. We can and must learn from our mistakes and missteps. Turning setbacks and adversity into lessons is one of the most powerful ways to speed progress toward a goal, to gain the strength to carry on, and to create a better life.

Walt Disney exemplifies this principle. A constant innovator, Disney brought an exceptional vision to his work that changed world culture forever. Among many other honors, this beloved icon won 26 Academy Awards, was awarded a Congressional Gold Medal, and had a Los Angeles concert hall named for him. Yet he admitted that his life was riddled with crushing setbacks, disappointments, financial failures, and occasional bouts of depression. His conclusion? “All the adversity I’ve had in my life, all my troubles and obstacles, have strengthened me,” he declared. “You may not realize it when it happens, but a kick in the teeth may be the best thing in the world for you.”

Although we don’t want to invite adversity into our lives, we can learn a great deal from it, especially when we have the support of strong family and community bonds. In 2000, Glen H. Elder and Rand D. Conger looked at data from several Iowa counties to see how the catastrophic farm crises of the 1980s and 1990s had affected children growing up in rural areas.⁴ They found that the majority of these kids were academically successful and had established paths to significant life achievement. Their hardships may actually have strengthened their ability to move forward.

Interestingly, among the resources that helped these challenged kids develop into successful adults were strong, positive bonds with their parents, being required to do productive work, and a family emphasis on “nonmaterial goals.” These children had learned that what was most valuable in life transcended money. They had also discovered their own value by facing and accomplishing challenging tasks—one of the most powerful ways to build, strengthen, and empower a sense of personal esteem and self-respect.

Trust yourself. Create the kind of self that you will be happy to live with all your life. Make the most of yourself by fanning the tiny, inner sparks of possibility into flames of achievement.

—Foster C. McClellan

Wild Child

In her mid-twenties, my friend Lennie Alzate had no idea what she wanted to do with her life. Raised in Las Vegas, Nevada, she had been a “hell-raiser” in her teens, according to her mom, but one with an irrepressible curiosity and a thirst for knowledge. Now, with a bachelor’s degree in psychology, Lennie was floundering. “What next?” she wondered. Always passionate about reading, she had discovered a fascination with the law and considered becoming a lawyer. But her self-image was still colored by her having been a bit of a “wild child.” This seemed incongruous with her notion of what it would take to be an attorney. She had thought a law career was out of her reach, but now that she was an adult and was going nowhere, she reconsidered. “Maybe a law career is possible,” she thought. “Why not at least apply to law school? If I can get in, I’ll take it from there.”

To her amazement, she was accepted at one of the schools she was most hoping to attend. That hurdle passed, she took the next step: she applied for a significant loan and scraped together a few other resources to pay for tuition and to buy her books. She reasoned, “Even if I don’t become a lawyer, I’ll learn, and I’ll be better prepared to make my way in life.”

I met Lennie shortly after she had graduated from law school. She was studying for the bar exam, and her focus and determination shone like her infectious smile. I saw that this young woman exemplified the principle that confidence and self-esteem are built one step at a time. Shortly thereafter, she told me that her determination and application had paid off—she’d passed the bar exam on her first attempt. Only 10 percent of her classmates had achieved this feat. Now newly licensed, she became one of a countless number of lawyers who were without a job and hoped to find one. However, her growing confidence in her own ability to have a successful law career had taken a tremendous leap.

At first, Lennie struggled just to survive and had to take odd jobs to get by. She washed cars, worked as a temporary employee in the offices of other attorneys, and performed work that was far beneath her qualifications. Yet she grew stronger in the process. Lennie saw herself as moving forward, one step at a time, despite her apparently slow start. She stayed positive. In spite of her disappointments and financial struggles, she kept going and did her best. She had no idea how success would come, but she had shown herself that she could take on a challenge and overcome obstacles. Her trust in herself—built step by step by doing whatever it took and stretching herself just beyond her comfort zone—was only continuing to grow.

After many months of working at unfulfilling jobs, Lennie received an opportunity that fit more closely with her education and desire. She was asked to join the staff of a successful but small real estate law firm. For months she wrote briefs and learned more about the business. The firm’s partners soon recognized her talent and drive. Within a year of their hiring her, she was promoted to lead attorney, and her employers set up a corporation in her name. A mere two years after passing the bar exam, Lennie had a full roster of law clients and was the owner of a new corporation. She had achieved her dream and was doing work that she valued, while enjoying a comfortable income.

Although she had few financial resources, Lennie had decided to roll the dice on her interest in the law. She hadn’t known exactly how it would pan out. Moving forward meant putting her self-doubt on the shelf for a while and placing one foot in front of the other in the direction of her goal. Along the way, she had discovered a strong and capable young woman who inspired her to keep going. That young woman happened to be herself.

Investing in Ourselves

While the self-esteem required to achieve true prosperity may seem to have little to do with material possessions, sometimes a well-thought-out and wisely selected purchase can help to boost our self-esteem. This might mean buying a new suit for a job interview, taking out a well-considered loan to buy a more reliable car, or upgrading one’s computer to expand one’s capacity to serve customers. When these kinds of investments are thoughtfully approached and consciously made, they can increase one’s self-esteem and self-respect. Part of the value of such investments is that when we project worthiness and success—whether it is through our attire, our attitude, or the tools we use—the world responds to us in kind. This feedback from our environment can reinforce our self-confidence and inspire continued confidence from others.

When I was growing up, my grandfather Guy demonstrated the value of investing in attire. It is one of the simplest, yet most powerful ways we can project a positive image and feel good about ourselves. It was my grandfather’s habit to buy the best clothes he could afford. I recall the many well-tailored suits and ties he wore. Whenever he left his house, he made an effort to look his best. I have no doubt that, as an African American school principal in 1960s Tennessee, he did this deliberately—and to great effect. He was well known and respected in his mixed-race community and was elected to the county board of education. His competence, intelligence, and natural self-confidence won him that seat, but his desire to look the part sure didn’t hurt.

Sour Note Turns Sweet

Another key factor in establishing self-esteem and self-worth is to find an avenue for the expression of something you love. Love is expansive, attractive, and cohesive. Here again, one of the most publicly successful people in America, Donald Trump, has wisdom to offer. He asserts that having passion for your work is a key to achieving true wealth. “If you love what you do, you are going to work harder, you are going to try harder, you are going to be better at it, and you’re going to enjoy your life more,” he writes. “Many people believe that I started out with a lot of money from my father. The truth is that when I started out in business, I was practically broke. My father didn’t give me much money, but what he did give me was… the simple formula for getting wealthy: work hard doing what you love.”⁵

When I was an undergraduate in college, I had a friend whom I will call Nathan who loved to sing. Whenever my friends and I rode in Nathan’s car, he would turn on the radio and sing along with popular tunes. The problem was that he wasn’t very good at it. My friends and I soon grew tired of listening to his off-key efforts and complained all the way. Finally, we chose to stop riding with him. We would occasionally see him driving around campus, singing his heart out tunelessly, but with gusto. After about a year of refusing the pleasure of Nathan’s serenades, there came a day when it happened to be convenient for us to catch a ride with him. As usual, Nathan had the radio playing, and when a popular song started, he began to sing along. We were astounded. Nathan could now deliver the song just as well as the singer who had recorded it. He could see that we were stunned—and impressed—with the skill he had developed. When the next song came on, we asked to hear more of his spectacular voice. Knowing that we had previously stopped riding with him to avoid his singing, he grinned and refused to oblige us with another song. Denying us was his sweet revenge.

Through his love of singing and his relentless practice, Nathan had transformed his voice. Shortly after he surprised us in the car, he became the lead singer in a popular local band that played on and off campus. On several occasions, I saw him perform to large crowds with a stunning display of virtuosity and to screams of approval from the audience. Later, he and his band won acclaim on a tour of the United States. Nathan was well aware that his friends had thought he had no talent. We believed, as most people do, that singing is a talent that you either have or don’t have. But he had believed in himself and persisted, practicing daily to no one but his dashboard and his shower curtain. With each passing week, he could hear the improvement in his own voice, and his trust in himself and his own ability grew. Using the tool of his voice and much practice, he developed a skill until it became a talent. Through Nathan, I learned that self-confidence, persistence, and loving what you do can fuel the farthest journey to a cherished goal, as far-fetched as it may seem.

You’ve got to find what you love. And that is as true for your work as it is for your lovers. Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle. As with all matters of the heart, you’ll know when you find it. And, like any great relationship, it just gets better and better as the years roll on. So keep looking until you find it. Don’t settle.

—Steve Jobs, June 12, 2005,
Stanford University Commencement Address

Small Steps

SUCCESS magazine publisher Darren Hardy is an eloquent proponent of the “small steps” principle. He has put the idea into action in his own life, and he has seen it in the lives of the many successful people he’s come to know through his work. He says, “Once you start tracking your life, your attention will be focused on the smallest things you’re doing right, as well as the smallest things you’re doing wrong. And when you choose to make even the smallest course corrections consistently, over time, you’ll begin to see amazing results. But don’t expect immediate fanfare. When I say ‘small’ course corrections, I’m talking truly invisible. Chances are no one’s going to notice them anytime soon. There will be no applause. No one’s going to send you a congratulations card or a trophy for these disciplines. And yet, eventually, their compounding effect will result in an exceptional payoff.”

As someone whose life is focused on success every day, Darren has learned this lesson so well that he can spend an entire hour discussing it with an audience and not lose their interest for even a moment: “It’s the littlest disciplines that pay off over time, the effort and preparation for the great triumph that happened when no one was looking. And yet the results are exceptional. A horse wins by a nose, but gets 10 times the prize money. Is the horse 10 times faster? No, just a little bit better. But it was those extra laps around the track, the extra discipline in the horse’s nutrition, or the extra work by the jockey that made the results a little bit better with compounded rewards.”⁶

You have brains in your head.
You have feet in your shoes.
You can steer yourself in any direction you choose.
You’re on your own.
And you know what you know.
YOU are the guy who’ll decide where to go.

—Dr. Seuss, Oh, the Places You’ll Go!

Pioneering psychologist Abraham Maslow asserted that self-esteem allows us to face life with more confidence, benevolence, and optimism. It makes us willing to aim a little higher and stretch a little farther, to take the risks that are necessary if we are to achieve our goals. To develop self-esteem is to expand our capacity to be happy. Moreover, it is only when we have self-esteem and self-respect that we can realize our full potential—that we can become who we are and all we are capable of becoming, emotionally, creatively, and spiritually. Each step along the way—each small goal achieved, each bruised attempt to jump higher in life, and each debt repaid—teaches us about ourselves and our abilities, and paves the way to success and prosperity, however we define those things for ourselves.