When it comes to spending money, I have been known to suffer from selective memory. I can’t tell you how many times I have checked my credit card balance and thought, “Oh no, I’ve been hacked!” only to go in and confirm that all of those charges were, in fact, mine. Has that ever happened to you?
To help with this, a few years ago I started having my credit card company email me every time there was a charge over $15.00. I did it because I wanted to make sure I “felt” every charge when it happened instead of just when I reviewed my bill.
While I didn’t identify it as such at the time, it turns out in taking this step, I was acknowledging and proactively trying to address a weakness in my “money mindset.”
A money mindset, according to author and money psychologist Kathleen Burns Kingsbury, is your thoughts and beliefs about money. It is formed during childhood through your experiences with money, and observations of how the people around you dealt with money.
Kathleen discusses the idea of a money mindset on an episode of one of my favorite podcasts, HerMoney with Jean Chatzky. In the episode, Jean talks to Kathleen about her book Breaking Money Silence: How to Shatter Money Taboos, Talk More Openly about Finances, and Live a Richer Life (I haven’t read it yet but it immediately went on my list!). Here is what I learned.
5 Questions to Help You Identify Your Money Mindset
To identify Jean’s money mindset, Kathleen asked her five questions and had Jean say the first thing that came to mind. Jean’s answer to these questions were very positive. My answers, on the other hand, were not.
This surprised me because I thought I had really come a long way in improving my relationship with money. In 3 Tips for Managing Money Better Than Your Parents Did, I even wrote about the money lessons I learned in childhood and how I have worked to have overcome them.
Apparently, I still have a lot work to do.
Question #1: Saving Money is …
I answered this question with “necessary” which I guess is better than “hard” but still not exactly a word to inspire joy in an activity. Getting your oil changed is necessary. Flossing your teeth is necessary. Do I really want my attitude toward saving to be on par with getting my teeth cleaned?
A healthier attitude—and one that I want to adopt—is reflected in the word Jean responded with: “freeing.” I’m saving money now so that I have a sufficient income stream in the future so that I don’t have to work if I don’t want to. I know this and yet being free to choose what I do with my time wasn’t the first thing that occurred to me.
Now that I am aware of it, I am going to work on changing my attitude, and focus on the joy of saving for a future where I work because I want to and not because I have to.
Question #2: Spending Money is…
I think my response to this question—”complicated”—very much reflects my parents relationship with money. Spending money should be fun, and maybe in the moment it is, but the anxiety that fills me when I look at my income versus my expenses versus my debt quickly erases the fun in spending.
I am very curious to see if my attitude toward spending changes when I finally pay off all my debt (other than my mortgage) in a few months. It will be the first time since my freshman year of college that I’ve been out of debt so uncharted territory.
Question #3: My parents taught me money was…
As I revealed in a previous post, the main lessons I learned about money from my parents were 1) we never had enough of it and 2) what we did have we were terrible at managing.
This idea of scarcity is still an issue for me. I think it is one of the reasons I still balance my checkbook down to the penny (I have to buy check registers separately now because I go through them way faster than I do checks), and monitor my investment accounts so closely.
I do feel more confident about managing my money than I would have thought possible. This has been a more recent development in my life, however. I started putting at least 10% of my income toward my retirement at age 28 but more because the “experts” said I should then because I knew what I was doing. It wasn’t until my mid-30s that I really took control and connected this small act with some day being able to retire comfortably.
I probably missed out on some returns but I’m thankful I had the gumption to start when I did. Even if my returns were below market average, compounding worked its magic. By the time I took control, I had a decent amount to work with.
Question #4: Talking about money is…
As a personal finance blogger, it was my answer to Kathleen’s last two questions that I found most surprising. For this one, the word that immediately came to mind was “impolite.”
I often hear people say that money is the last taboo subject—even more so than sex—so I guess I shouldn’t be surprised by this thought. It is so wrong, though!
My mission is to help women, and especially single women, save and invest enough so that they can one day retire comfortably. Being able to talk about money to each other and with our investment advisors is critical to making this happen.
Question #5: People who talk about money are…
If my answer to the previous question was “impolite” then it is only natural that my immediate response to this question is “crass.” That’s me—impolite and crass.
As you can guess, this realization doesn’t mean I am going to quit blogging. But it does help me understand some of the writer’s block I experience when it comes to drafting posts: I sometimes find writing about money uncomfortable because I still harbor beliefs that it is rude to do so.
I am not sure exactly how to overcome these beliefs. For right now, I think the best solution is to just ignore the discomfort because this subject is too important.
What is Your Money Mindset?
How did you answer the the questions above? Did your answers surprise you? Let me know in the comment section below.