When it comes to managing money, our attitudes, beliefs, and habits play a critical role. Managing money isn’t just about crunching numbers—it's also about how we think and feel about it. For example, have you ever thought about what kind of attitude you have towards money? Or what beliefs about money you had growing up and do you still hold on to those? How do you feel about money?
Many of our financial behaviors are driven by unconscious beliefs about money formed by our upbringing, culture, and personal experiences. These are known as “money scripts” and they significantly impact how we manage our finances. For example, some people were taught and believe that you should always save your money and try not to spend it. Some believe that money is the root of all evil, and others believe that you must work hard for money. All these beliefs influence our financial behaviors and decisions in subtle ways.
The four most common money scripts are money avoidance, money worship, money status and money vigilance. Money avoidance views money negatively, leading to neglect or under-earning. For example, you believe that money is the root of all evil and so you feel guilty about having more money than others and you may tend to give more money away, keeping your savings low. Money worship believes money solves problems, causing overspending or dissatisfaction. Think shopping spree on luxury items in the hopes that they will make you feel better or more complete. The problem with this is that you may struggle with unwanted credit card debt and you will never be satisfied, constantly chasing the next new thing. Money status links self-worth to wealth, resulting in overspending to maintain an image. Ever heard the saying, “you are only as successful as your bank account”? Trying to maintain a wealthy image in order to equate it to your worth is damaging, so don’t do it. At Monthly Financial Coaching we specifically change the term “net worth” to “net assets” just to further disconnect someone’s sense of self-worth from their net worth. And finally, Money vigilance prioritizes frugality, potentially causing excessive saving or spending anxiety.
These money scripts all seem negative, but they don’t have to be. When you become more aware of your financial behaviors and thought patterns, you can actively work toward reframing those negative beliefs and develop a positive financial mindset. How do you go about this? Start by shifting from a mindset of scarcity or fear to one of empowerment. Use money as a tool to spark joy, enhance your life and reduce stress. Talk to your family or friends about money and address the emotional aspects of money management.
What’s a belief about money that is deeply ingrained in your mind and is negatively affecting how you feel about money?
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