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How to Change Your Beliefs About Money

We can only generate, save and invest as much as our mindset allows us to.

Dealing with money is unavoidable in a commerce-driven world like ours. Money is one of the most powerful tools people interface with on a daily basis, whether they realize it or not.

The money you earn represents labor, provides purchasing power and facilitates large-scale movement and change. For such an essential tool, however, money all too often becomes a negative force in peoples’ lives.

Money is both powerful and divisive. And in a society increasingly caught up in consumerism, it’s not surprising that many people have bad relationships with money.

Those who have lots of money may use it unwisely or find themselves unable to stop grasping for more, while those who have less may feel trapped, powerless or resentful of others.

Whether you have too much of it or too little, money can be a significant point of stress in your life. Negative beliefs about money — and your relationship to it — can influence poor spending and budgeting decisions and generally decrease your sense of contentment in your life.

In order to budget better, spend smarter and live happier, you need to change the negative attitudes you might have towards money.

If you’re interested in changing your relationship with your finances for the better, do some soul searching and take steps to remedy underlying issues.

To start out, here are some ways you can actively work to change your beliefs about money.

1. Identify Your Money Scripts

The attitudes about money formed through childhood experiences and parent stories and struggles continue to influence people into adulthood. These early-forming attitudes and behaviors are called money scripts, and they have a lot to do with how you handle money today.

Some money scripts are healthy. Others are not.

For example, people who believe money is indicative of self-worth, who idealize money and material gain or who belittle money’s importance are all more likely to have lower financial outcomes than those who don’t hold those beliefs.

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Isolating a problem is the best way to figure out how to fix it, so if you think your issues with money might come from a negative script, it’s a good idea to try to identify it for what it is.

Because money scripts are often formed in childhood, it’s possible to learn about the origins of your attitudes toward money by talking with your parents and relatives about their own attitudes. However, you can also discover your money script by consulting your memory to figure out where your beliefs come from.

Once you’ve identified a problem, you can work by yourself or with a financial psychologist to counteract negative thought patterns and habits.

2. Recognize Cultural Attitudes Toward Money

Like your family environment, your cultural environment can influence your financial attitudes as well. In the United States, people are encouraged to beat out their economic competition to become “the best.”

Because wealth is often equated with success, this can leave people with modest bank accounts feeling unnecessarily down on their achievements. This isn’t the case around the world, however.

One writer found, for example, that the Swedish culture’s prioritization of humbleness and conformity made financial life easier, even though the living expenses were higher.

Money is a part of culture. Therefore, attitudes toward money vary around the world.

Some beliefs are healthier than others, and they all have their advantages and disadvantages, but you can learn a lot about your relationship with money by comparing it to those in other countries.

When you gain a broader view of financial attitudes, you can begin to weed out the parts of your beliefs that aren’t benefiting you.

3. Remember that Money is Physical Object

Back before online banking, money was a tool that you could hold in your hand, something physical that communicated value. Today, however, the individual value of a dollar is often forgotten as we look more at the total sum of our wealth rather than each piece of the whole.

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Recognize that money isn’t a universal given but rather a tool and system that was adopted for its convenience. You should treat money as a physical object instead of a symbolic idea, especially if you want to stop conflating your net worth with your self-worth.

If you need a reminder that money is a tool, you could start carrying bills again instead of relying on a debit or credit card. Some people also collect coins, which keeps the physical and even historical aspect of currency at the front of their minds.

By using physical tender for small purchases, you can better recognize the power of the money you do have while remaining conscious of how much money you’re spending.

4. Differentiate Wants From Needs

A lot of peoples’ dissatisfaction with their financial situation comes from the feeling that too many things are out of reach. However, most people who feel this way probably have enough to provide for their basic needs, so the stress and frustration their dissatisfaction causes them might be doing them more harm than good.

Happiness and income level are not directly related. In fact, happiness seems to plateau before annual income even reaches $100,000.

This goes to show that money really can’t buy happiness. If you have enough to satisfy your needs, you have enough to be happy.

The trick, in this case, is differentiating wants from needs. Consumers are constantly bombarded with messages telling them they need this or that product to be happy, popular, successful, loved, etc.

In order to foster a healthier relationship with money, you need to resist these messages and define your needs for yourself.

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Be conscious of the reasons behind every purchase you make and avoid substituting material goods for a real solution to emotional problems.

5. Talk About Your Mistakes

A lot of people feel shame about their financial situations, especially if they aren’t as well-off as they might have hoped to be. Because of this shame, people often avoid talking about money at all costs to keep themselves from looking incompetent.

This silence is unfortunate because it allows negative attitudes to fester and bad habits to carry on unchecked.

In her podcast Bad With Money, Gabby Dunn breaks the silence and talks to others not just about money but also about money problems. Her example is a good one to follow.

Money shouldn’t be something to be ashamed of. Talking openly and honestly about money with your friends, loved ones or a professional can help you figure out how to improve your relationship with money.

If you’re brave, open up and talk about some of your money mistakes. If you just can’t bring yourself to do it, though, you can still learn a lot from other people by reading reputable books, listening to podcasts like Dunn’s and doing your own research.

There are plenty of resources available.

By trying out some of these tips, and by figuring out what methods work best for you, it’s certainly possible to improve your relationship with money. Old beliefs don’t have to hold you down and influence how you budget and spend your money.

In fact, by understanding what you believe about money and working to counteract any negative attitudes that might be harming you, you can live a healthier, happier, less stressful life.

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