Money is a tricky subject for many of us. You may struggle to plan ahead and constantly feel like you’re failing to reach your savings goal. You may feel anxious when you check your bank accounts or credit card statement. You may be accumulating debt but feel unable to stop the cycle. If any of these pain points apply to you, know that you’re not alone! In today’s blog post, I want to explore financial therapy and how it can improve your relationship with money. Let’s get started!
According to the Financial Therapy Association (of which I am a member), financial therapy combines the importance of financial management with the skills needed to handle the cognitive and emotional challenges associated with money.
As a financial therapist, I want to help you approach your relationship with money with abundant compassionate curiosity and zero judgment (what I like to call ACC0J). We can use this approach to explore the underlying motivators for financial hang-ups and to speak to the fact that most “money” things aren’t actually about money. In fact, I believe ACC0J is the best tool for effective exploration.
Two Common Money Mindsets
Let’s use ACC0J to dive deeper into two common mindsets: a mindset of scarcity and a mindset of abundance. Note that a mindset is a belief that feels like a truth. Both of these mindsets show the emotional side of money and how it impacts your behaviors and decisions.
Mindset of Scarcity
prompts you to believe that every dollar could be your last and to behave accordingly. This mindset might show up when you feel anger, betrayal, and victimization—for instance, if a clerk overcharges you. You may even observe your own reaction as an “overreaction.” If you apply ACC0J here, you’ll notice that, instead of judging your reaction and scolding yourself, you can shift your response by applying compassion and saying, “Oh, there is that scarcity mindset again.”
Mindset of abundance
often shows up with the belief that there will always be enough. There is nothing wrong with believing that there is enough, but what we want to focus on here is when the mindset gets in the way of feeling sufficiency and peace with our money. In this case, “abundance” may be the word, but avoidance is the action. You may avoid checking your bank account balance rather than mindfully observe your purchases. You may fail to develop a business plan, thinking it will all work out regardless, rather than set clear action items to help you reach your goals. If you apply ACC0J here, instead of shaming yourself, you can uncover your fears and anxieties and begin to heal.
These examples may seem like over-simplifications of potential issues, but they are just small examples of the hundreds of ways that mindsets can influence our money interactions.
How Financial Therapy Can Improve Your Relationship With Money
The ultimate goal of financial therapy is to help you develop a healthy relationship with money. Below, let’s look at the three game changers of financial therapy and how each one can help you improve your relationship with money.
Track the thoughts and feelings associated with your purchases:
I offer a tracking sheet for free to my newsletter subscribers. Thoughts can often be a doorway into our feelings. For example, we may buy a shirt and have thoughts like, “This is a great-looking shirt, and I will look confident at my interview. I will finally prove to my family that I am smart and capable.” These thoughts, then, can open up to feelings of “fear, excitement, fear, fun, and fear.” This practice is a great way to begin to identify patterns and potential mindsets. There is also an expanded version of this tracking sheet, which can help you step a bit more deeply into your thoughts and feelings as you identify your mindsets.
Make friends with your pain points:
Whether it’s avoidance, anxiety, or fear, accept it and welcome it into your life. The power here lies in approaching your weaknesses.
Live out your plan, not your bank balance:
As a financial therapist, I help my clients build a plan—not a budget but a plan—that embodies flexibility and kindness. The plan works best when it includes an understanding of how to make necessary adjustments and how to communicate these changes to yourself and others with ACC0J.
Oftentimes, my clients will start financial therapy with the beliefs that they are “bad with money” and that they “can’t have a conversation about money without a fight.” After several sessions, they report decreased reactivity as well as increased compassion and kindness for self in connection to money. They also experience more insight into their behaviors and a “real change in their money life.”
If you’re ready to rewrite your money story but don’t know where to begin, consider my 5 Days to Finding Financial Clarity. Using my foundational journaling practice—called “Breathe, Intend, Move”—and a workbook to track your progress, you’ll increase your money mindfulness and gain confidence and clarity in your financial decisions.
Wendy Wright, LMFT, CEDS, CIEC, Financial Therapist, is a psychotherapist and consultant based in Denver, CO. She offers financial counseling and helps you name the blocks that get in the way of your best financial life. In her early career, she was a mortgage loan officer, business owner, and successful house flipper. Then, she later became a Licensed Marriage and Family Therapist. It is the blend of the therapeutic and the financial that can help you find more clarity and freedom in your relationship with money, spending, saving, and debting.
Wendy is the founder and CEO of Financial Therapy Solutions, LLC, a financial therapy group practice based in Denver, CO. The Financial Therapy Solutions team of therapists also offer telehealth services. She is a featured guest on several podcasts, including It’s Not a Crisis and the Nav.it Podcast, and was also a featured speaker for the Mental Health and Wealth Summit in 2021.