Types of Relationships with Money

Do you know the kind of relationship you have with your money? Is it toxic or healthy? There are so many factors that impact your relationship with money. Culture, religion, gender, family, childhood upbringing, and education play an essential role in how you relate to money. Turning to your childhood can be a great way to understand your current type of relationship with money.

Where your type of relationship with money begins

According to a PBS report, children can understand basic concepts about money as early as age 3. By 7, their values around money are already set. Thus, how we acquire, spend and manage money is primarily influenced by the nurturing we receive during childhood about money and values. 

A man is sitting on the ground, holding an ice cream cone in one hand and his son with the other while smiling. His son also has an ice cream cone, smiling while looking at it. The over laid text reads How Your Childhood Impacts Your Relationship with Money. The read now button links to the article How Your Childhood Impacts Your Relationship with Money.

For example, suppose you grew up witnessing arguments about it. In that case, it can trigger a range of emotions, such as anxiety, resentment or feelings of elitism that we carry through life. Such experiences and emotions shape our values and relationship with money.

Having been raised in a strict Christian family, I witnessed my parents consistently tithe without fail. Years later, even though I hardly attend church, 10% of everything I earn goes to charity. 

The fact is, you already created a relationship with money. This relationship with money lies on a spectrum. On either end of the spectrum is financial insecurity. With one end, you may be extremely frugal and concerned with the relative scarcity of your means; on the other, you may be very irresponsible. The way each of us processes and organizes money messages—as well as how we model money behaviors—is unique.

Your relationship with money influences your life, career choices, spending habits, and even what you ate for dinner last night. Thus, having a healthy relationship with money is vital as it positively impacts your interactions with money.

What does a healthy relationship with money look like?

A healthy relationship with money, also known as financial wellness, leads to financial freedom and independence. It involves having a satisfying, conscious and purposeful relationship  with money that is not overly stressful

Our overall wellness improves when we have a loving and healthy relationship with people. Similarly, our financial health improves with a positive relationship with money and declines when we have a negative one.

Financial health means understanding how money works, using it to help you maintain good health, live a life with less stress, and invest in things that will support you long-term.

Signs of a healthy relationship include:

  • Having well established financial plan that aligns with your monetary values
  • Spending money based on your values
  • Having low or reasonable debt that you are actively paying off
  • Creating a budget and sticking to it
  • Having an emergency fund.
  • Saving to achieve financial goals

What does an unhealthy relationship with money look like?

An unhealthy relationship can lead to poor financial choices. This poor relationship also affects the other relationships in your life. For instance, finances are a significant cause of divorce for many people and can cause money conflicts in families.

Signs of toxic relationships with many money may include:

  • Feeling guilty when you spend money: Having money but not enjoying it is one of the most toxic financial behaviours. To develop a healthy relationship, you need to start perceiving money as a tool that enables you to live a fulfilled life. Budget your money, and spend, save and invest according to it.
  • Thinking that you will be happy when you have a certain amount in the bank: Money does not bring happiness; thus, you need to be content with what you have.
  • Playing the blame game as an excuse for your poor financial conditions: ‘I am broke because of my meagre salary.’ ‘I broke because of the crippling medical expenses that go into caring for an aged loved one.’ There are a million ‘valid’ excuses you can give for why your financial state is wanting. However, if you want a healthy financial life, you have to stop giving excuses or complaining and start working towards improving it,
  • You resent people who seem financially stable: If you think rich people earn their wealth through dishonest means, you will not prosper. Not everyone rich person has accumulated their wealth the wrong way. Most self-made billionaires started from scratch and built their businesses over time to become the conglomerates that they are right now. Instead of resentment, learn from them!
  • Spending prematurely on luxuries: How often do you swipe up your credit card to pay for an expensive dinner out? Maxing out your credit cards to pay for ‘wants’ is a sign of a toxic relationship.

Other signs include chronic worrying about not having enough, quickly falling victim to scams or get-rich-quick schemes, and always having an excuse not to save.

A woman lying on the couch with ten and twenty dollar bills in her hands covering her face. The over laid text reads How to Improve Your Relationship with Money. The read now button links to the article Why You Need to Improve Your Relationship with Money.

How to improve your type of relationship with money

Now that you know what impacts your relationship with money, it’s time to start creating a positive relationship with money. Here are tips to get you started:

Evaluate your current relationship with money

Image of a cell phone showing a payment of $91.07 to Dog Gone Holistic Monday, 21 June. The text above the image reads Transaction Swiping. Track what you spend. *Fall in love* with your progress.

Are your thoughts about money? Are they positive or negative? What relationship did your parents have with money while you were growing up? Are you mimicking the money relationships of your friends? Seek to understand your relationship with money by asking yourself these questions. 

Also, consider your thoughts and feelings when interacting with financial tasks. For example, how do you feel when you get your paycheck? Or when you hand over your credit card to pay for something? Being aware of the type of relationship you have can help you transform it to where you want to be.

Establish how your version of a healthy relationship with money looks

Once you identify the type of relationship with money, the next thing is to determine what you want your relationship with money to be. I want a relationship with money that feels easy and makes me confident and calm. You get to decide what a good relationship with money looks like. Start by thinking about your values and ensure your relationship with money aligns with them.

Create a roadmap to implement changes to your type of relationship with money

If you are in a toxic relationship, aim to change it and if you are already in a positive one, aim to improve it. Begin by taking small, manageable steps to get where you want to be, and practice at a pace that works for you daily, weekly, or monthly.

On the road to success, mistakes happen. Learn to forgive yourself and quickly move on from mistakes. Even the wealthiest people make money mistakes, learn from your mistake and keep trying until you get it right.

Have a positive mindset

A positive money mindset and the right attitude can strengthen your relationship with money. Appreciate and be content with what you already have. That sofa you have is good enough. You don’t have to upgrade it to a new model. Celebrate all wins, no matter how small. Any progress you make towards changing your relationship with money is a win. Remind yourself to focus on you, and avoid resentful thoughts like “it isn’t fair!” or “must be nice.”A positive mindset empowers your relationship!

Seek professional help

It’s OK to ask for help. You can read books, articles, and blogs to get educated and make informed financial decisions. However, on some issues, like exploring your past, improving your habits or increasing accountability, you may need to lean on someone like a money coach. For trauma related to money, you may be best starting out with a financial therapist. For specific advice regarding including investments, or managing assets, you may need the guidance of a CPA. Professionals will work with you to create a plan for your money and help you to feel good about your money.

Bottom line: your type of relationship with money can improve

Like any other toxic relationship, having an unhealthy relationship with money can wreak havoc on your life. Evaluate your current situation and identify the type of relationship you have with money. If it is toxic, implement deliberate measures to help you transform it. Push past your discomfort when thinking or talking about money so you can learn, grow and improve your life!

Related Reads

Defining Your Relationship with Money

Why You Need to Improve Your Relationship with Money

How Your Childhood Impacts Your Relationship with Money

Type of Relationships with Money

Image of the author of this article, Nyamonaa Agata.

Nyamonaa Agata is a content writer specializing in creating value-based, search-engine-optimized content for informational and marketing purposes. With over five years in the banking and financial services industry and an MBA, she has an extensive background in writing on personal finance, investment, fintech, B2B, and B2C topics

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