Love & Money
Do you have a Love or Hate Relationship with Money?
February is the month of love and the ideal time to answer a very important question: what kind of relationship do you have with money?
It is a crucial question, because your relationship with money affects every financial decision you make, from how you earn and spend money to how you save and invest.
Here are three ways to improve your relationship with money for a better financial future.
1. Identify your Money “Script”
Our relationship with money, and our knowledge about money and how to manage it, are shaped by the lessons, examples and stories we learned as children.
The story we believe about money – or our “money script” as financial psychologist Bradley Klontz describes it – profoundly influences every decision we make about money.
Identifying your money story gives you an opportunity to re-evaluate this “money script”, and whether it is helping or hampering you in building a successful financial future. Remember, you can change your “money script” to a more empowering story, in which you enjoy a great relationship with money and it becomes an ally in realising your dreams.
Klontz’s Four Types of Money Scripts
- Money Avoidance – ignoring money problems, avoiding money management, spending mindlessly, believing “money is bad/trouble” or “poverty is a virtue”.
- Money Worship – overworking, believing money is the only key to fulfilment or happiness.
- Money Status – overspending, unnecessary spending, believing “money equals status”, or “success is measured in income or possessions”.
- Money Vigilance – being anxious about money, being risk-averse, being stingy or underspending (for example, skimping on regular vehicle maintenance only to incur huge repair costs).
2. Invest Time and Effort”Script”
As with any other successful relationship, your relationship with money requires time and attention. You can’t have a successful relationship with anyone or anything if you ignore it or refuse to give it any time or effort.
Make a date at least once a month to focus on and pay attention to your financial affairs. Use this time to plan your financial future, to better understand your finances and how you manage it, and to learn more about money.
Respect is a crucial part of any relationship. It can be defined as understanding the value of someone or something, treating them well, and taking good care of them.
Respecting money starts with appreciating the money you have, understanding its value and taking good care of it. That means spending it wisely, saving some of it regularly and investing it carefully to unlock its full potential.
With Valentine’s in the air, grab the opportunity to re-evaluate your relationship with money. Commit to affording your money the time, effort and respect that will redefine your money “script” and, consequently, every financial decision you make this year.