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Writing down how you feel whenever you interact with money can help you understand your money story.
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If you’ve had a hard time with your finances, it might be because your feelings about money are complicated.
It’s important to understand your money story — the beliefs you have about how you get and spend money.
To figure that out, think about your feelings when you interact with money, and write it down.
If you’re like most folks, you might struggle with following popular personal finance advice. Why’s that? Well, for many people, that’s because it comes off as dry, technical, and a tad out-of-touch. Further, it doesn’t sync up to many people’s dreams, values, beliefs, and emotions.
For many of us, decisions we make around our finances aren’t based in logic and pragmatism. Rather, they’re rooted in emotion.
There’s a disconnect between financial literacy and emotions, because success with money appears to be simple, explains Jacent Wamala, a licensed marriage and family therapist.
“The steps you need to take to create financial freedom and independence are very straightforward, but most people don’t follow through with otherwise simple frameworks for financial success,” says Wamala. “That’s because they haven’t addressed the psychological contributions to their financial situation. It can be really painful to face emotions and money stories often filled with trauma and turmoil.”
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Understanding your money story
Our ability to have a positive relationship with our finances is complex, to say the least. And it starts with our money story, which is shaped by the beliefs and perceptions we have around our finances. For instance, we might believe that we don’t deserve to enjoy financial stability, and the only thing we’ll ever know is to feel constantly strapped for cash.
“The most dominant approach in financial literacy is telling people what to do — aka, focusing on their behaviors, how much they should save, how to start investing, and so forth — without including the importance of their thoughts and feelings,” says certified financial therapist Lindsay Bryan-Podvin.”Doing so omits the importance and power of one’s money story and emotions.”
Bryan-Podvin points out that the outcome of focusing on behavior only financial literacy and education is that it shifts the blame of a person’s financial situation solely onto their willpower.
“It’s not as sellable to say, ‘Hey everyone, your money story deserves some loving and empathic exploration as you work on improving your financial health,'” says Bryan-Podvin.
The connections between emotions and money are cyclical in nature, explains Wamala. “Emotions can cause and contribute to how you spend money, and vice versa, how we spend can cause and contribute to our emotional state being affected.
“All of this stems from the money story you learn growing up — from how family talks about and interacts with money to the overt and covert messages received from friends, school and community regarding money,” continues Wamala. “You often pick up the habits we see from others or swing in the other direction because we’re deterred by what we see.”
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Audit your emotions — and consider a journal
To get in touch with your emotions around money, keep track of them, suggests Wamala. How? Start by gauging how you feel when you make purchases or look at your bank account. “I always tell my students to conduct audits,” she says. “Check to see where your money went the last 30, 60, 90 days and ask yourself, did your emotional state contribute to how you spent money in that time?”
Plus, were there any life-altering circumstances — think losses, breakups, birthdays, celebrations, hormonal fluctuations, or illness — that could have affected how you spent your money? “Documentation is always helpful when it comes to tracking habits, behaviors and decisions,” says Wamala. “This can be in the form of budgeting.”
Wealth starts with wellness, says Wamala, and that includes emotional health. “Ignoring your emotions keeps you in the dark when it comes to how and why you spend money,” she says. “Most purchases are made emotionally. Awareness of your emotions empowers you to have more influence in your situation. And because of it, you can start to see more financial progress.”
Bryan-Podvin recommends journaling about your money and emotions that pop up for at least a week. It works like this: Every time you have a money-related interaction, write it down and what it felt like.
For example, once you’ve paid for groceries, ask yourself how you felt about it. Did you feel proud? Anxious? Unbothered? Or, let’s say you get a Venmo request from a friend that you’d forgotten to pay for your share of a recent ski trip. Do you feel embarrassed? Relieved? Avoidant?
“We’ll always have emotions, especially when it comes to money,” says Bryan-Podvin. “Rather than demonizing our money-related emotions, it’s a much more empathic and sustainable approach to get curious about your emotions.”