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Build a healthier relationship with money
Break away from old patterns to avoid a holiday hangover.
Article published: December 11, 2023
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In this article:
- Money issues often surface this time of year and lead to a new year tinged with regret or anxiety.
- Issues can be rooted in family concerns, past financial worries or even how money was treated in your childhood.
- If youve been anxious, resentful or otherwise stressed about money, your financial planner can help you get to the bottom of it and make a plan to deal with it.
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Ah, the holidays. For many of us, theyre a time of year to focus on family, traditions and fun, and the usual guardrails that keep us from overindulging go out the window.泭
Not that theres anything wrong with that. But when it comes to money, a holiday hangover can bring with it guilt, anxiety and regret in January.
If you find yourself falling into financial patterns that leave you feeling down now or throughout the seasons the new year is a great time to take a closer look at how money is intersecting with your life and whether youd like to make some changes.
Use this as an opportunity to talk to your financial planner about how to make the coming year different. Here are some potential areas to explore.
Do you fall into a spender vs. Saver dynamic with your spouse or partner?
Its rare for two people to agree on everything. And money is a deeply sensitive topic, so finances are ripe for disagreement in a marriage or partnership.
Perhaps nowhere are those disagreements more frequent than between a couple where one person is a spender and one is a saver. And for obvious reasons, that spender-saver dynamic tends to be especially sensitive around the holidays.
You might be part of this dynamic if you often argue over things like:泭
- When its appropriate to upgrade or replace items
- How much time and energy to spend shopping for the best price
- How to respond to financial challenges like high inflation or an income loss
- How much transparency each of you owes the other when it comes to spending
- How much to support family members or charities
- And, of course, how much to spend on holiday gifts, travel, experiences, decorations, and food
46%
of Americans have fought with their partners about money, according to those surveyed in our Everyday Wealth in America research report.
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Whats the solution? Talking about it can help, sometimes quite a lot. 83% of people surveyed say that it helps them resolve disagreements, and 38% say they want to talk about money more.
But your talks need to go beyond we-cant-afford-this-yes-we-can. Most importantly, youll each need to put your judgments aside and understand where the other is coming from in your overall approach to money.
Once youve made progress there, you can take actions like agreeing to a spending budget (especially helpful for the holidays), deciding how much you can each spend at will, and aligning on what it will take to reach your financial goals. Learn more about fostering financial intimacy and the benefits of talking about money with your partner.
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Tip #1
Talk to your spouse or partner more intentionally about your financial decisions, especially those that have been a source of conflict. And泭get together with your planner泭if you need a neutral perspective or help understanding the potential consequences of a decision.
Do you have a scarcity mindset when it comes to money?
If your answer is yes, the holidays are probably especially stressful for you. But a scarcity mindset can negatively affect your feelings all year long, and you owe it to yourself to get to the bottom of it.泭
If you started out with fewer resources, you probably learned to be prudent with your spending. Sometimes these emotions can morph into a scarcity mindset the belief that your wealth is limited and must be protected.泭
People with a scarcity mindset might:泭
- Avoid taking any financial risk for fear of loss泭
- Refuse to spend money on non-necessities, or always choose the budget option by default泭
- Prioritize their net worth over personal relationships泭
- Believe theyll never have enough money for their needs泭
- Obsess over the markets ups and downs泭
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Stephen Covey, who developed the idea of a scarcity mindset in his classic bestseller The 7 Habits of Highly Effective People, argued that this mentality keeps people from achieving their goals because it promotes short-term thinking, a zero-sum worldview and tunnel vision focused on risks instead of opportunities.泭
And behavioral scientists Eldar Shafir and Sendhil Mullainathan found that people who are preoccupied with the idea of financial scarcity do significantly worse on intelligence tests than when theyre not most likely making decisions differently than they otherwise would.泭
If you have a scarcity mindset, you might want to:
- Have a financial devils advocate to help you focus equally on risks and opportunities
- Intentionally practice gratitude for what youve been able to accomplish
- Budget a certain amount that you must spend on things that bring you happiness
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Tip #2
Ask your financial planner for a reality check on whether youre taking the right amount of care with your money or way too much. They can also be a sounding board to help you reshape your mindset.泭
Do you have limiting beliefs about money?
Everyone has their own thoughts and beliefs about money and its role in their life. These beliefs arent necessarily right or wrong theyre based on feelings, not facts. And some of them can cause you to make decisions that dont help you reach your full potential or to miss out on some of the joy of the holidays.泭
Some examples of limiting beliefs might be:泭
- Saving is always better than spending泭
- The future is uncertain so its better to spend what you have泭
- I dont deserve my wealth泭
- Stocks are too risky泭
- People should always financially stand on their own two feet泭
All-or-nothing thoughts like these commonly go back to your childhood or to a traumatic financial event, like a job loss. But if youre making decisions based on these rules without actually considering whether theyre true, you could be holding yourself back.泭
What to do? Financial therapist Amanda Clayman suggests people who have been negatively affected by money messages in childhood need to recontextualize those learned responses in adulthood to conquer financial stress and anxiety.
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Tip #3
Talk to someone you trust about how your family handled money and what lessons you took from it. A spouse or partner can listen and offer insight, but a financial planner can also play that role and help you differentiate facts from feelings.
Your wealth should be a blessing, not a curse
The hard work youve put into building wealth can enable you to live the life you want, enjoy helping others and reach a level of safety and security you may not have thought attainable.泭
But if your money often leaves you feeling upset, stressed or anxious, were here for you 2024 can be different. 91做厙 Engines planners can give you insight into your thought patterns, help you communicate better with your loved ones and show you the potential impact of your decisions.
Need more help?
Set up a free meeting and get guidance tailored to your unique circumstances.
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