The Emotional Side of Money

For a healthy perspective and relationship with money, we must focus on the past, pay attention to our present relationship with money and plan how we are going to improve our own financial wellbeing.

Written by Elaine King CFP® / August 5, 2022

Quick Bites

  • Understanding how your environment growing up influenced your view on money is key.
  • We should also examine our current relationship with money.
  • Once we understand ourselves and our perspectives, we can focus on our goals.

To master the art of financial wellbeing does not require a high intellectual quotient (IQ), but it does require a high emotional quotient (EQ). In fact, in my experience working with thousands of families I have found that most money decisions are made at an emotional level.

For a healthy perspective and relationship with money, we must focus on the past to uncover beliefs that were planted while we were growing up. We must pay attention to our present relationship with money and plan how we are going to improve our own financial well-being.

Uncover money beliefs

Money values are created in the environment where we grow up and are based on what we are told regarding creating, growing and using it. Children learn from their parents what is right, and wrong, and based on that information we start creating our own beliefs.

For example, I grew up in the late 80’s in Peru when the inflation rate was more than 7,000%. I was raised to save and choose wisely because the currency would lose value by the day and goods were scarce. Knowing this helps me be present when making decisions and aware of investing for the future.

Current relationship with money

What is your current relationship with money? It's good to evaluate your beliefs, actions and values and make sure they are aligned. If they're not, that could become a major stress, which can evolve into depression, taking time and money to heal.

Our modern world does not help. We're being sold things all the time, and material goods are often presented as trophies of success. How can we pass on these shiny objects that promise our acceptance and self-confidence? Take a close look at what your existing relationship with money is and if it's working for you.

Improve your financial wellbeing

First, consider what money means to you. Is it good, bad, abundant, scarce or hard to make? What were the messages that you heard growing up? Those shape the way you see money today and may be getting in your way to reaching your goals.

Now, ask yourself what you did the first time you earned money and what do you do today? Do you go out shopping? Save, invest or share? The first unconscious action will determine your money personality and its key to achieving your financial wellbeing.

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In my career advising individuals about holistic financial planning, I have learned that money DNA is also inherited. The good news is you have the power to transform it and shape it to your benefit, but only if you dig inside to truly understand what is in the original code. For example, I have one client who came to me for help saving. They had been raised to believe debt is good and it's fine to just pay the minimum on your credit card every month.

The third thing to learn about improving your financial wellbeing is to write down the money lessons you learned from your friends and family related to creating, growing and using it. For example, my mother taught me to never stop learning and today I allocate a percentage of my spending to learning.

Finally, define the value you give money today: Is it power, fun, creativity, security, care, competition, or obligation? However you choose to see money will be a reflection of what it is today and how you can align your values to reach your goals.

About the Author

Elaine King

Elaine King CFP®

Elaine has served as the Family’s Financial Planner for over 1,200 families and 100 multigenerational family enterprises crafting actionable family financial plans.

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