You must identify and understand your money attitude before you can make any financial changes. Otherwise, you are destined to make the same mistakes time and time again.
There is a say “Attitude is everything.” I honestly believe that. Your attitude towards every aspect of your life absolutely plays a vital role in how you think and act. But, did you know that your attitude can also affect the way you handle money?
Your money attitude is often the reason why you spend too much, are in debt or fear your finances. But, that doesn’t have to mean you can’t make a change.
Changing your financial outlook begins with your money attitude. If you don’t first get to the root of your problem, you will be destined to make the same mistakes time and time again.
WHAT IS YOUR MONEY ATTITUDE?
There are four different money attitudes that you may identify with. And, it is possible that you fall under more than one. However, when you ask yourself these questions you should lean more towards one than the other. Read these below to figure out which one you relate to.
If you adore money it means you love to spend it. In many cases, you buy things (often on credit) just because you enjoy shopping. You don’t worry about the fact that you must pay for it later. You look at the credit card bill and focus only on the minimum payment.
Simply put, you love to spend money. That’s it.
This attitude can best be described as “keeping up with the Joneses.” However, did you know that in all likelihood, the Joneses are up to their eyeballs in debt? Why would you want to keep up with someone who lives their life that way?
The truth is, the Joneses are showing you what you want to see. For all you know, they fight over money every night. Their kids may resent their parents for pushing them too hard. You can’t judge a book by its cover, so don’t hold yourself to an ideal you know very little about.
If you feel you don’t deserve money, then this money attitude is yours. It isn’t even just a feeling of not deserving money. You may also feel anxious or stressed at the mere thought of money. You just don’t handle it well.
This is one of most difficult attitudes to change. That doesn’t mean it is impossible. It means that you may have to work a bit harder to make it happen.
You might be cautious with your money. Some may call you frugal. Others may call you a miser. Whatever the name, you need to learn to let go once in a while.
This cautious person refuses to spend money. They are afraid to let it go and/or fear that it will be gone, never to return.
When you are overly cautious with money, you risk opportunities.
CHANGE YOUR MONEY ATTITUDE
Now that you know which attitude you have, now is the time to make changes. This is something only you can do. No one can do it for you.
IF YOU ARE ADORING
The first step in overcoming your love of money is to cut off its head. That means drastic changes. You should cut up your credit cards. If they prompt you to spend without limit, then this is the first change you need to make.
If you’re used to spending your free time in the store, you’ll need to find new hobbies. Find something to do with the time you would normally spend walking the aisles hunting for the treasures you believe you need.
The final thing to do is to make a list of everything you love in this life. Don’t leave anything off of your list. Got it? Good. Now, go through the list and cross off everything that does not love you in return. You’ll notice that what remains are the people in your life (and maybe a pet). Those other things? They’re just things. They do not matter.
IF YOU ARE ENTITLED
To start, you have to determine why you feel the need to keep up with them. There could be a deep reason why you feel this way.
You may hate your job and use these things to compensate. Low self-worth is another reason you buy items as you want to impress your friends. It could even be that you had nothing growing up and feel you are due. You owe it to that poor child.
If you use money to keep up with another individual, take a look at their life and determine what part of it intrigues you. He may have an amazing job that you would love to have; so maybe you should find one that makes you equally as happy.
You are only entitled to be happy and need to look at your life in that way. Things won’t make you happy.
IF YOU AVOID MONEY
If you don’t feel you deserve money, you need to ask yourself one question: Why not? It could be due to things you’ve done in your past.
Whatever the reason, you need to know that everyone deserves to make money. You need it to survive. You don’t need more than you can handle, but you do need enough to support yourself and your family.
The truth is, avoiding your finances doesn’t make money issues go away. In fact, it makes them worse. For example, if you found a lump on your neck, would you avoid it and hope it went away? No. You’d go to the doctor to figure out what it was, and then do whatever is needed to remove or treat it.
IF YOU ARE CAUTIOUS
When you refuse to spend money, you risk missing out on opportunities. What about that once-in-a-lifetime trip? You could miss the chance to go to dinner to meet the person of your dreams or make a key career connection. You don’t want to live your life with regrets.
I’m not saying to go crazy. I’m saying that you need to give yourself permission to spend money.
When you set up your budget, just add an item that gives you permission to spend. It will be OK. I promise.
IS YOUR MONEY ATTITUDE THAT IMPORTANT?
I have heard many people tell me that this really doesn’t matter as it doesn’t have that much bearing on your finances. The truth is that it can control the way you look at money – even if you aren’t aware of it.
In 2002, when I declared bankruptcy, I never took the time to understand what lead me down that path. Let me rephrase that. I never took the time to understand why I spent so much money and racked up that much debt. I walked out of the courtroom that day, thinking I’d never make any mistakes with money again. Boy, did I get that wrong!!
Around 18 months after that happened, I married the love of my life. We didn’t go crazy spending money, but we did accumulate debt. Here I was, a couple of years removed from the bankruptcy and debt was building back up again. Are you kidding me?!?!?
When my husband and I decided that we wanted to work ourselves out from our debt, I felt the same way I had years earlier. I came to realize that I simply put a Band-Aid on an open wound when I declared bankruptcy. I never took the time to understand why I did this to myself.
It took a lot of soul searching and understanding, but I figured it out. I had a mix of entitled and adoring attitudes. I never had money growing up. When I became an adult, I thought I owed my younger self the opportunity to experience these things. This, in turn, lead me to adore money. I loved spending and I loved getting things.
This time around, I did not have debt to excessive purchases. However, we had still overspent and were struggling to make ends meet. When we both committed to making the change, we talked about money and the way it made us felt.
Together, I helped him with his money avoidance and he with my entitled attitudes. It’s been more than 7 years now that we’ve been debt free. This has a lot to do with understanding our own money attitudes.
CAN YOU REALLY CHANGE YOUR MONEY ATTITUDE?
It will take some time to change the way you look at money and your money attitude. I promise that it won’t happy in one day. It may not even change next week. You may find it’s still the same three months from now.
The point is that you can now recognize your attitude and work with it. You’ll no longer fight your feelings about money. Instead, understanding the way you look at money – and the problems it creates – is a good thing.
Change cannot begin until you know what needs to be changed. No matter your attitude toward money, there are things that everyone needs to do:
- Determine your financial goals. Decide what’s important to you — and only you. Not the Joneses, not your childhood self. Once you know where you want to go, you can create a plan to turn your dreams and goals into reality.
- Figure out why you’re being held back. You have to understand why you feel the way you do about money. That allows you to move onto the final step.
- Make the changes needed to allow you to move forward. If you don’t change the way you look at money, you’ll never succeed in your financial reboot. You might have the right budget and financial plan, but if you don’t change how you deal with money on a very basic level, you’ll continue to have financial failures over and over again.
Now that you know your money attitude and are ready to change it, you’re ready to move on to the fun part: the action plan for your budget, your debt, and beyond!