Sometimes people will ask me, “How do I know if I need financial therapy?”
My most common response is, “If you’re stuck around something related to money.” That may be a bit too broad, because my position is that just about anybody can benefit from financial therapy. But there are some specific problematic money behaviors that we can be on the lookout for in ourselves or others in our lives. I wouldn’t call them warning signs, because they’re usually more like entrenched patterns, and they are blockages to achieving financial and emotional wellbeing
The American Psychological Association found that three out of four Americans identify money and money stressors as the number one stress in their life—more than work, physical health, or children. So obviously, money is a big deal. It affects everything that we do.
Problematic money behaviors, then, are also a big deal that affect much more than just our financial bottom line. Among these behaviors are overspending, underspending, hoarding, compulsive shopping, gambling addiction, keeping money secrets, financial enmeshment, financial enabling, and workaholism.
These problematic behaviors come from parts of ourselves that have completely good intentions. The part holds the belief that this behavior will protect us, usually by helping us to avoid feeling the pain of intense and unresolved emotions that are tied to trauma. The behaviors may not be serving us well today, but at one time they did serve to protect us and were necessary survival skills.
Sometimes problematic money behaviors are described as disorders. That’s a term that needs to be used with some care, because in the mental health field “disorders” usually has a specific diagnostic meaning. In his 2001 book The Money Trap, Ron Gallen describes problematic money behaviors as emotional and spiritual imbalances that express themselves as continuing problems with money and work. I like that term, because it goes well with the framework of Internal Family Systems theory, which describes the way normal internal parts of us are wounded by trauma and forced into roles as exiles or protectors.
The exiles are the parts carrying the intense and unresolved emotions from the financial trauma. Their protectors are parts which carry thoughts and behaviors that are adapted to make sure that those intense emotions stay locked away and never come up.
It’s important to realize that these problematic money behaviors are typically not caused by a lack of money.
It might seem logical to conclude that problems and stress around money can be cured by knowing more about money. Yet research is showing more and more that is not the case. This bears out what I’ve seen over the years in working with financial planning clients. My estimate is that you can solve perhaps 20% of money problems with more money knowledge. It’s a great place to start, but it alone is not enough.
That’s why we have to look a little deeper. Money problems are really rooted in people’s early experiences with money. They may be showing up in real time in real life right now, but almost every one can be tied back to childhood experience and early wounding.
The experience that comes out in our money behaviors may not even be a specific financial trauma. It can include what would be viewed as both positive and negative experiences during childhood. They can be cultural influences. They can come from school. They can, of course, come from our primary caregivers. They can come from other influences in our life. But usually they affect us when we are young and unable to filter out the messages that we’re getting as being logical or illogical, correct or incorrect.
Sometimes our problematic money behaviors are very visible and obviously harmful. Other times they’re not very visible at all. Some aspects of some of them are often seen by society as positive or signs of success. Many of them are secretive, in part because talking about money is one of the biggest taboos in our society. In working with people’s emotions around money issues, I have come to realize that there is more shame around money issues than almost any other area, including addictions and sexuality.
We will cover some problematic money behaviors in upcoming podcasts. Maybe you will see yourself or someone you love in some of those. You will also see that there is hope and healing. We can explore, understand, and modify destructive money behaviors and begin to flourish.
Check out The Financial Therapy Podcast by Rick Kahler