Father sitting with daughters putting money in a piggy bank
Personal Finance

Key takeaways

  • Our childhood experiences related to money can lead to anxiety in our adult lives.
  • The first step in improving the relationship is to examine your feelings about money and where they come from.
  • Then you can identify steps to create new habits.

While you’re celebrating this Valentine’s Day, spend some time thinking about your relationship with money. Would you send it a sweet card or a dozen dead roses?

A survey released by the American Psychological Association in October 2022, reported that inflation was a source of stress for 83% of Americans, and 57% said their main source of financial stress was not having enough money to pay for things like rent and mortgage. Stress and anxiety over money are not good for our physical or mental health. Having a healthy relationship with money is important because it leads to a sense of financial wellness, making us feel secure and satisfied. Financial wellness is an important factor in our overall wellness.

This article will explore what an unhealthy relationship looks like, why a healthy relationship is important, and how to improve yours.

What is an unhealthy relationship with money?

To appreciate what a healthy relationship with money looks like, let’s look first at the characteristics of an unhealthy relationship.

The messages we give ourselves about money have deep roots. In fact, psychologists say beliefs about money are set early on, probably by the age of 7. If there’s money anxiety in a household, children pick up on it and it colors their money relationship later in life. If a family spent money unwisely, was in debt, and didn’t pay bills, that early experience can also be encoded in the child’s mind.

Rather than simply blaming childhood for your poor relationship with money, acknowledge it, then address your adult beliefs and behaviors.

Here are some signs your relationship with money has room for improvement. As in any relationship, emotions play a big role.

Not knowing your financial situation

Right now, do you know what you have in your bank account, how much debt you owe, and your credit score? If you avoid looking at your bank and credit card statements, that fear and purposeful ignorance are signs that you feel powerless when it comes to your money.

Spending impulsively, or being afraid to spend

You might think an unhealthy relationship with money means someone is living beyond their means, but the opposite can also be true. If frugality and fear of spending, even on things that would make your life easier, are causing financial anxiety, that’s another sign of an unhealthy relationship.

Feeling shame at a lack of financial health

Do you feel jealous about what you perceive as others’ financial satisfaction and security? Or do you feel ashamed because you’ve worked your whole life and don’t have much in the way of savings to show for it? A bad relationship with money may be at play.

Feeling you have to spend money to enjoy yourself

Does “having a good time” always involve spending? That can lead to spending too much on things that make you feel good in the moment but are of transitory value, like dinners, vacations, alcohol, clothes, and cars.

Credit card debt

A large load of consumer debt is a glaring sign that your current relationship with money needs mending. The debt is making it virtually impossible to save money. Things are even worse if you’re only paying the interest on those credit cards or the monthly minimum payment.

Not talking about your finances

People are usually reluctant to talk about money in general, but if you have a positive relationship with it you should feel comfortable talking about it with your spouse, partner, or children. Not talking about it at all is a sign of a poor relationship with money.

Breaking the cycle

Just as the signs of an unhealthy relationship are tied up with emotion, so are the steps involved in breaking the cycle and improving your relationship.

In this section, we’ll offer some questions you might ask yourself. No matter how you answer these questions, don’t beat yourself up about it. Changing old habits is hard, but you’re trying to set yourself on a better path.

What were my early experiences with money?

Financial beliefs are embedded for most of us in childhood. Even if your parents didn’t explicitly teach you about money, you still learned through observation. If they were overly frugal in their money habits, you may have the same habits. Or, you might have completely opposite ones, treating yourself to the things you couldn’t have as a child.

How does my relationship with money affect me emotionally?

When you think about money and your use of it, does it conjure negative feelings? Maybe even fear that you’ll run out of money? Or, does spending give you a temporary sense of euphoria, making you more likely to whip out that credit card?

What triggers me to spend or save?

Take a hard look at your own money habits. How do you use credit? Do you prioritize saving? Do you spend because you don’t want your friends to think you can’t afford it? Or do you pinch every penny and regularly deny yourself things that could make life more pleasant (like the occasional dinner out or a pedicure).

Once you have the answers to these questions, create a forward-looking statement about why you want your money relationship to change. Some examples:

  • I want to feel less stressed about money so I can be more relaxed and have fun with my children.
  • I want to use money as a tool rather than as an emotional crutch.
  • I want to feel confident in how I handle money, so I don’t experience guilt when I do spend.

Examining your own money habits and figuring out what needs to change isn’t easy to do on your own, so include your spouse or partner in the discussions. You may find it useful to seek professional help from a neutral third party, such as a financial planner, CPA, or therapist.

Establishing a new relationship

Now that you’ve examined your relationship with money, it’s time to create a new one. With the insights you’ve gained, you can find a path to where you want to be. Then, identify small steps you can take to get there. These steps may include:

  • Create a weekly or monthly budget that distinguishes between needs (food, shelter, transportation) and wants (small stuff like a night out or big stuff like a new car). Make sure that budget includes the occasional indulgence. If you’ve planned for it, you won’t feel guilty about spending it.
  • Set a financial goal, whether it’s to save at least $100 a month, pay off credit cards, or put aside money for retirement or college.
  • Think before spending so that your use of money is more intentional and less impulsive.
  • Plan how to congratulate yourself when you reach a goal or milestone.
  • Be alert to signs that old habits are resurfacing.

Taking these steps can, over time, diminish your negative feelings toward money, give you a greater sense of financial wellness and set you on a path to financial confidence and security. Most of all, you’ll be using money in its proper role–as a tool–rather than letting it take you on an emotional roller coaster.

This article is for educational purposes only and is not intended to provide financial, tax or legal advice. You should consult a professional for specific advice. Best Egg is not responsible for the information contained in third-party sites cited or hyperlinked in this article. Best Egg is not responsible for, and does not provide or endorse third party products, services or other third-party content.


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