❝Financial health is having a conscious and purposeful relationship with money.❞ -Brad Klontz
I'm playing pool with some close friends and some of their friends. I'm not very good at pool, so I spend most of my time talking. One of my friends' work colleagues tells me that she earned over $100,000 last year for the first time. Hitting six-figure status was very important to her. I don't make that, but I hope to soon. This six-figure status seems to be stuck in my head as a good marker of success. I live in an apartment with a friend of mine and drive a really old car. Once I start making six figures I'll have my life together - at least I hope. This becomes my goal in life; to make more than $100,000 per year. Well, I got there...and then some. The thing they don't tell you is that more money comes with more responsibility, more pressure, more demands, and ultimately less flexibility, autonomy, and freedom. Chasing money without first examining my relationship with money turned out to be the wrong choice for me. My guess is that it's the wrong choice for you, too.1
RELATIONSHIP WITH MONEY: WHAT IT IS
If you don't know you have a relationship with money, you probably don't have a very good one. If you have a pulse, you might be wondering what in the heck it means to have a relationship with money. It makes sense to have a relationship with someONE, because, you know, we all have relationships with living beings - partners, family members, friends, colleagues, even pets and other animals. But how can we have a relationship with someTHING? It's a good question. By analogy, think about your car. It's likely that you have a car, and you have a relationship with your car. This varies by person, of course, but some of you take really good care of your car in exchange for it taking really good care of you. Some of you don't really care about it and thus don't care for it; you take it for granted. Some of you keep it immaculately clean, and to others, the cleanliness of their car isn't something that people should care about. Some of you want to know exactly how it works and know how to fix it if something goes wrong. Others wonder if they have to replace their blinker fluid or take their car in just to have antifreeze put in (which, incidentally, I'm not ashamed to admit I just did an hour before writing this paragraph). Hopefully, it's now easier to understand how you can have a relationship with an inanimate object, like a car. That should shed some light on how you can have a relationship with money. Whether you know it or not, you have a relationship with money; everybody does. Whether it's good or bad, and whether you want to or not, this relationship exists. Without exploration, many of us don't know we have a relationship with money, making our relationship with it something we can't see.
RELATIONSHIPS WITH MONEY CAN BE COMPLICATED
Many of us don't know that we have a relationship with money, but even for those who do, it's not always a great relationship. Maybe you make pretty good money but aren't saving as much as you would like. Perhaps you spend more than you know you should and on things that you realize aren't important to you. It could be that you are afraid of money and don't ask for it, leaving you a habitual underearner. Maybe you make good money, are saving, and not spending too much, but you still feel anxiety and stress when it comes to money. Or, you and your partner have very different feelings about money, leading to money fights. Money is stressful for most people and made more stressful if we have a complicated relationship with it.
MONEY TOUCHES EVERY AREA OF OUR LIVES
It's no wonder money is so stressful. Money touches every area of our lives. Do you need to find a place to live? Do you rent or buy? How much can you afford? How high should your fixed expenses be? What's the rate on your mortgage? Are you looking for a job? How much will you make? Are there ways to keep taxes low? Should you open that 401(k)? Are you making what you're worth? Do you want to relax? Can you afford to take the time off? Does your job give you vacation pay or will your next paycheck be lower? Does your form of relaxation cost money? Can you afford that? Do you want to have a conversation with your partner? Does money come up? Are you both spending money in the same way? Are you trying to keep your partners from knowing how much you actually spend? I think you get the idea. There are very few life decisions that don't have a money component and even fewer money decisions that don't involve your life somehow. Money touches almost every area of our lives; we can't escape it.
IMPROVING YOUR RELATIONSHIP WITH MONEY IS MORE THAN INCOME
A common solution most of us jump to is that we simply need more money. That seems like an obvious solution. We perceive our issues are due to a lack of money and, therefore, if we had more money we would be better off. If you've gone through a major promotion, job change, or financial windfall, like a settlement or other payout, you probably know that your financial issues didn't go away. They may have changed, sure. But if you're frustrated because you haven't been able to change your financial habits or you still suffer from financial worry, it might be time to take a look under the hood and examine your relationship with money.
IMPROVE YOUR RELATIONSHIP WITH MONEY TO INCREASE FINANCIAL HEALTH
In order to increase your financial health, it's more important to address the hidden causes of your money troubles and that means exploring your relationship with money. In order to truly be comfortable with money, you need a better, healthier relationship with it. Improving your relationship with money will often lead to better outcomes, less stress, and less worry.