4 Ways To Change Your Relationship with Money
I am terrified of being in debt, yet I am currently sitting under a mountain of it. More often than not, I feel completely overwhelmed and anxious about my financial situation — clueless and hopeless as to how to change it. How on earth did I get into this mess, and how am I supposed to shift it?
To begin with, I grew up in a household that took money for granted. My mother grew up in a wealthy midwestern family. Although she made it a priority to become financially independent, their wealth, combined with some early investments, has kept our family more than comfortable. My father was a very different story. He grew up with nothing, in a a blue-collar suburb of Los Angeles. He worked two jobs while being a full-time student, and didn’t become financially stable until he was in his late 30's. He feared money his whole life, always in a mindset of scarcity, never trusting that there would be enough or knowing what to do with what he had.
My first conversations about money with my parents involved how it wasn’t polite to discuss with others, and how we had people who were actively managing it for us — via accountants, lawyers, and investment firms. I was allotted a weekly allowance when I hit my teen years, which I constantly exceeded. The sit downs that ensued carried a great deal of disappointment and shame on the part of my father. He couldn’t figure out why I was having so much trouble keeping to this weekly budget. It was more than enough for a fourteen year-old girl to afford public transportation, lunch, and the occasional new piece of clothing to match my changing physique. What was he doing wrong, and what was I missing?
One Word: Values
Whenever I would ask my parents for help in figuring out how to manage my money, they referred me to our financial institution. And sure, these people that had been managing my parent’s investments for years had lots of great advice about stock options, retirement accounts, and general strategies for saving — but what I really needed was someone to sit me down and talk to me about values.
I was a teenager trying to figure out how to structure a budget and the most my parents could tell me was to track what I was spending and base my budget off those numbers….When what I really needed to hear about was what I should be placing value on, and that how I chose to spend my money actually dictated how I chose to take care of myself. My parents expected me to understand that ensuring I had a place to live, a mode of transportation, food to eat, clothes on my back, and basic healthcare, should be my main priorities. Even though I didn’t see this behavior demonstrated in their habits.
My father would come home with a brand new TV along with a suite of surround-sound speakers on a whim. My parents bought new cars every 5–7 years, and frequently planned lavish vacations abroad. They paid for my health insurance, my phone bill, my car, my moving costs, my education, my clothing, etc. At 18, they gave me control over my college fund, which paid out a neat salary in addition to covering the entirety of my tuition costs. It always seemed like there was more where that came from, and that it was never going to run out.
Now, as an adult, I am finally beginning to put the pieces together regarding my denial and avoidance around money management. Because the money did run out, as it does when don’t you don’t know how to effectively budget, I finally began to feel an underlying panic. At the end of the day, it came down to one fundamental piece that was missing — I didn’t know actually how to take care of myself.
Don’t get me wrong — I am BLESSED. I feel incredibly lucky to have the childhood that I did, where every talent was nourished and every physical need was always met without question. I am indeed privileged, and grateful for that privilege. Intertwined with that privilege is also a great deal of shame and fear. I feel guilty for being given what I never had to work for. I feel shame for my naiveté and sheltered upbringing. I judge that I should know better, that I should have learned how to manage this on my own — by now. I can’t ask for anything more because my parents have never said no to me. Listening to these judgements only creates more shame, more avoidance, and more denial for me.
Why don’t you just make more money?
This is a question that has been posed by numerous sources recently, given that I am college educated, have a robust resumé, and am currently working for minimum wage in a coffee shop. The problem with this question is that the money isn’t actually the problem. It’s my relationship to the money that truly matters.
No matter how much money I make, if I don’t know how to take care of myself, I will always be in a mindset of fear and scarcity.
If I see money as something to be feared — or something to be taken for granted, I will never learn how to manage it to best suit my own needs. When I am afraid of the money I owe, my instinct is to throw the entirety of what I earn at my debt, without considering the consequences. Logically, this makes no sense. If all of my income is going towards paying off my debts, what will be leftover to fund what I actually need day to day? How will I prepare for future expenses, or create a budget that is designed to take care of me? I needed to rearrange my priorities where my debt wasn’t the focus —it was making sure all of my most basic needs were actually being met.
What does that look like?
Well, it means putting my living space and anything that goes into maintaining it FIRST. It means making sure I can afford my rent, mortgage, property taxes, utilities, necessary repairs, my internet service, my phone bill, etc., before I set money aside for anything else. It means fixing my car before I pay off my credit card. Yes, really. It means choosing to buy food from the grocery store rather than ordering takeout. It means budgeting for car insurance, health insurance, home owner’s insurance, before I pay off that loan I took out to pay for my healthcare in the first place. It means placing value on the things that actually matter, vs. the things that give me momentary highs or feelings of fleeting validation. It means that I put the state of my life as it is now, above my future credit score.
Sounds terrifying, right? You’re not alone in that fear, I promise.
If there’s anything I’ve learned over the past year, it’s that money is wrapped up in a whole lot of scary vulnerable self-awareness stuff! It’s also an extremely sensitive and taboo subject that most people would rather not discuss. I was always taught that my credit score and my financial standing was the most important thing in my life — that it would be the #1 determining factor in my ability to move through life with ease. My father’s response upon hearing, “Do I have to?” was always “The only things we really have to do are die and pay taxes.” Perhaps a little grim, but not entirely inaccurate.
Want to know the secret to identifying those values and prioritizing them?
#1. Stop avoiding. Start keeping track.
Stop spending money that you don’t have. This seems simple enough, but putting those credit cards in a drawer and switching all of your online subscriptions, automatic withdrawals, and bill-pay accounts over to your debit card can seem…daunting. That’s OK, because you only really need to accomplish this for one day. Don’t worry, you’ll start over tomorrow, and go on from there.
Make a budget. Start with housing, move onto food, then account for your transportation needs. Take a look at clothing, personal care agendas, and healthcare requirements. If you can, set aside a little money for what entertains you — be it books, movies, music, going out, traveling, etc. Include what you need for educational purposes, personal business ventures, and yes, taxes. Then, and only then, can you budget for your debt.
Track what you spend. You can use apps like You Need A Budget, Mint, or good ol’ Google spreadsheets. Record money that goes out on a daily basis, and categorize it in your budget accordingly. If you know you have necessary expenses coming up, put them in your calendar, or set goals for yourself to have certain account balances by those dates.
#2. Learn how to ask for help.
This might be the most important piece aside from being aware of your financial needs. It is OK to ask for help. Let me repeat that- it is OK to ask for help. This could mean scrounging up the courage to ask your credit card company for a lower interest rate, or APR. It may mean working with your financial institution on refinancing, or consolidating debt. It could mean asking friends to be mindful of your financial situation. It could even go so far as to asking family members for gifts, or loans, to help relieve your most immediate expenses.
No one can save you but yourself, but you can’t do this on your own. Yes, you will have to do the majority of the daily leg work in shifting your perspective and changing your own financial habits. This doesn’t mean that you have to be stoic and perfect in your transitions. Gifts, charity, and fantasy are not reliable sources of income, but being able to receive help and care from others is essential to this process. Swallow that pride, quell that shame, share how you’re feeling, ask for what you need, and be willing to receive it with no strings attached.
#3. Get our of your own way.
This leads me into the shame, fear, judgement, and self-loathing that I’ve been describing this whole time! Shame is not an effective motivator for change. Social workers have studies this social phenomenon. Look it up. I think there’s this pervasive ideology that we only attract more money into our lives when we are truly in need, desperate, or pathetic. That we can only be motivated to solve our financial woes if we’re one inch from being completely ruined. This might work, temporarily, but in the long run, it will only set you up for failure.
The more shame and self-judgement you feel, the more you attach to the idea that something is wrong with you, that you are bad, that you deserve to be this way because you got yourself into his mess and now you have to wallow in it. Hence, the less likely you are to believe that you are worth taking care of — which is the whole key to renegotiating your relationship with your debt.
#4. Build self-trust.
To quote my therapist, “Trust is built slowly over time and is based on actions, and the congruence between words and actions. You may need to DECIDE if you can trust yourself, taking some time and gathering the information you need in order to make that decision.” For example, ordering yummy unhealthy food because I’m feeling ashamed and self-judgy not only undermines my ability to trust myself with my own physical health, it undermines my ability to trust myself fiscally.
If you want to build trust in yourself, you have to choose behaviors that inspire trust. Making a healthier choice will inspire trust in yourself, thus increasing the odds that you might be worthy of trust. Pay attention to your motivations for repeating certain patterns and behaviors around your spending. Tracking your outflow will also help you identify these patterns and give you the motivation to build trust and awareness around how you choose to take care of yourself with your money.
In conclusion, I know from personal experience that being in debt can feel suffocating, and that asking for help can feel like it’s the scariest thing in the known universe. Please remember that you’re not alone in these feelings, or in your experience. The Motley Fool literally just published an article about how the majority of us (upwards of 80%) are currently in debt. There are also great resources out there to teach you how to manage your debt, and how to change your relationship to money. NPR has a wonderful free podcast called “Life Kit: Get Out Of Debt.” Counselors and bloggers like Jackie Beck have wonderfully inspiring stories and step by step programs to help you reorganize your life and take the fear out of your finances. Debtor’s Anonymous is a fabulous free solution for those who want the support of a local community and a more structured setting.
Last but not least, I want to end on an an affirmation, or reminder, of sorts. I trust that I did got get to where I currently am because I am a bad person, because I deserve what’s come to me, or because there is something wrong with me. I am worthy of my own care. I have the ability to care for myself. I have faith that I can figure this out. I trust that I am not alone in this. May I keep moving forward, to the best of my ability, one day at a time.