Definition
Locus of control is a psychological idea describing where a person locates the cause of what happens to them. Someone with an internal locus believes their results flow mainly from their own decisions and effort. Someone with an external locus believes results are driven by luck, circumstances, or other people.
The term comes from the psychologist Julian Rotter, and the distinction has since been linked to differences in achievement, persistence, and financial behavior.
Why it matters
How it works
The locus operates as an interpretive habit. When a venture fails, the internal mind asks what it can do differently; the external mind concludes that the system is rigged and stops trying. Over many cycles, these interpretations produce very different track records.
Shifting toward an internal locus does not mean denying that luck and circumstance exist. It means focusing attention on the slice of every situation that is genuinely within your influence and acting on it. The wealthy mindset treats setbacks as feedback about controllable factors rather than as proof that the outcome was never yours to determine.