As we prepare ourselves for the good, the bad, and the hung-over in the year to come, we’ve been doing a lot of introspection. How did we get to be where we are, and what does that mean for where we’re headed?
(And what we’ll be headed there in.) To understand the way we view ourselves, our lives, and our money, we turn to our emotional baggage. One of our most popular pairs of articles were about just that—how to identify our “money baggage” and how to overcome it.
Here’s what we learned:
Understanding why you approach your finances the way you do requires going back in time: Research by the APLUS project out of the University of Arizona found that parents’ financial behavior is one of the biggest influences on how people approach money as adults.
Everyone Enters Adulthood With Some Kind Of “Money Baggage”
Think of money baggage as an unconscious set of financial beliefs, attitudes, and behaviors that develop as a result of the way we saw money treated in our families while growing up. To start, try to think of a money philosophy that represents each of your parents. This could be something that you heard them repeat a lot, like, “Money doesn’t matter as long as you love your work” or, “There’s no way to become rich without taking advantage of others.” Chances are that even if you don’t agree with this belief, it’s still a voice that pops up in your head more often than you’d like.
Connect The Emotions
When you were younger, what was the emotional climate around money? Was there tension or fighting when bills arrived? Was money treated with contempt, like it was something dirty? Annette Lieberman, author of The Money Mirror, recommends trying to think of your first memory of money, as it has special emotional significance. Remembering the time when you realized your best friend’s family was rich or when you were yelled at for asking how much your parents earned can bring all of those feelings right back to you.
Examine Your Role Models
How did your parents go about everyday money management? Was it something routine or was budgeting only done when money was tight? Who did which task, mom or dad? The roles and responsibilities your parents took on provided a template that you will either repeat (or reject) in your own life.
Here’s how to ditch that extra baggage:
1. Don’t Fight The Feeling
Focus on tolerating your feelings instead of on changing them. You don’t need to like paying your bills, but you do need to sit down and finish the job. Use a technique called “Yes, and…” When you notice a negative emotion, say to yourself, “Yes, I feel [sad, anxious, angry]… and I need to [finish this budget, call my bank].”
2. Articulate Your Values
Is financial health important to you so you have the freedom to choose meaningful work? So you can give to others? So you can live in material comfort?
3. Create A Positive Vision
Set wise goals. A powerful goal has four key elements:
* It’s connected to your personal values.
* It’s stated in the positive (i.e., “I want to be debt-free” vs. “I want to stop charging things”).
* It’s within your control (ask for a raise vs. win the lottery.
* It has a stated time frame for achievement.
4. Find Your Structure
There’s a good chance you’ll repeat the financial patterns of your role models…unless you create a balanced structure that works for you. Determine:
* Your schedule for paying bills.
* How often you’ll reconcile your monthly earning/spending against your cash flow.
* When you will evaluate your progress on long-term goals.
Schedule these tasks in your planner and stick to them; don’t wait until you have free time (never happens) or until you feel like it (you won’t).
5. Be Flexible
Your feelings, values, goals, and structure will evolve over time. Don’t be afraid to review and revise. If something isn’t working for you, figure out how to change it.
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