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Too Much Money Can Be Stressful: Financial Comfort Zones

Have you ever figured out the minimum amount of money you need, both savings and income, in order to be comfortable? Most people haven't done this exercise, although most people do recognize that there is a minimum amount of money below which they would be uncomfortable.


Fewer people yet have thought about the maximum amount of money we could have in order for us to be comfortable. Sounds strange, right? How could anyone ever have too much money?


There Is A Minimum AND A Maximum


It is is easy for us to think about having too little money. We have bills to pay and a lifestyle that we've chosen. We need to keep that going. If we don't have or make enough money we can't afford our lifestyle anymore.


It's harder for us to think about having too much money, though. If you don't believe me, try this thought experiment. Think about people you know or have heard of who make twice or three times what you make. Then think about the people who are worth 5 or 10 times what you are worth. What do you think about those people?


We Try To Fit In


Humans have a desperate need to fit in. We need to be part of a tribe. When we find ourselves outside of what we are comfortable with financially, we don't feel like we belong. If we come into more money than we're used to - an insurance settlement, an inheritance, a promotion or a business that took off - we now have a different set of problems to worry about. Problems that we're not familiar with. We see ourselves as those "rich" people we used to dislike. This comes with discomfort.


We're Comfortable In Our Childhood Neighborhood


In their book Mind Over Money, Drs. Ted and Brad Klontz ask you to imagine what it was like growing up in your childhood neighborhood. If you're like most people, you felt safe and secure because that is what you knew. You knew the rules. You knew the people. This is the place you felt most comfortable. If you moved to a different neighborhood later in life, it could feel uncomfortable. That discomfort happens whether you had to move to a worse neighborhood or were able to move to a better one.


Similarly, our upbringings gave us a financial comfort zone. In what was "normal" to us financially growing up, we learned the rules. We knew the people. The rules and people are different as you move up and down the financial scale. This is uncomfortable.


We Will Try To Reduce Our Discomfort