How to Think About Wealth and Guilt


"You can't pour from an empty cup. Take care of yourself first."


-Unknown


Eric grew up in an upper-middle-class family. He attended private schools for most of his life, didn't have to worry about how to pay for college, never felt a sense of deprivation, and was given tens of thousands of dollars every year because his grandparents wanted to transfer money to later generations in a tax-advantaged way. Eric had no idea when he was growing up that he was rich by most people's standards. To him, it just felt normal. It wasn't until later in life that he realized just how much privilege he had. The idea that so much opportunity was given to him for seemingly no reason other than he was lucky to have been born into the right family made him feel undeserving. Eric feels guilty for his relatively easy ride through life.


Michelle grew up very poor. There were days in her childhood when she had to skip meals because there was no food in the house. Most of her clothes were hand-me-downs from her older siblings. When she finally got a job, she lived paycheck-to-paycheck, and sometimes the money didn't even last until the next paycheck. She married her high school sweetheart, and they both lived this way, struggling to get by. Later in life, Michelle's husband was tragically killed while he was working. As a result, Michelle received several million dollars as part of the settlement. On the surface, this seems like it would help alleviate some of her emotional stress. In reality, though, Michelle views this as blood money. Her husband had to die in order for her to get it. Michelle would give the money back tomorrow if it meant she could have her husband back. Michelle feels guilty for enjoying this money without her husband.


Sean and Candice have been working hard to implement a budget. They've done a lot of research, read several books, and downloaded all the right apps. Together, they implemented some household spending rules that would help them get ahead in the future. Sean enjoys going out to lunch with his work colleagues. Not only does this save some time in the morning not having to pack a lunch, but he gets to feel like he is part of the group. Going out to lunch is not part of their spending plan. Candice works as a nurse and sometimes comes home feeling stressed out from a long day at work. To help alleviate some of the stress, she finds herself doing some online shopping, or what she calls “retail therapy.” She knows that her online purchases are not part of their spending plan. Both Sean and Candice feel guilty for spending money in ways they know will help them in the long run.


Eric, Michelle, Sean, and Candice all feel guilty about their financial situations. These feelings of guilt weigh on them like a heavy vest. It's difficult to feel tranquility, joy, or happiness with guilt weighing them down.



Guilt From Having Money When Others Don't


One of the more common ways we tend to feel guilty around money is when we realize that we have money when others don't. There often are feelings of injustice or unfairness that come with this realization. These feelings of guilt tend to be more common among the children of financially successful people. This is because it feels more like a handout. When it feels like we didn't have to do anything to earn our standing in society, then it can feel like we got something we may not deserve.


Different people make different incomes for a wide variety of reasons. The same thing applies to wealth. If you're going to create a chart showing either how much people make or how much they have, there would be some people that have a lot and others that have a little, but most people would be in the middle. It would look like a bell curve. You have to be somewhere on this curve, and often it's through no fault of your own. This means that there will necessarily be people on the right side of the curve. If you happen to be one of those people, it's common to feel guilty about your relative position.


Gratitude is a great starting point, and somewhat of a silver-bullet. Shifting your focus from guilt to gratitude is not easy, but it is worth it. As soon as you can recognize how lucky you are, you can begin to be grateful for your luck. You can be grateful for your skill. You can be grateful for the privileges that you had.


Once you feel grateful for what you have, you can go to work helping others, if that is something you value. For some, that might mean giving your time or money to organizations that help people on the left side of this distribution. Others might find more value in contributing to organizations that focus on education and training. Still, others will find a lot of value in combating income and wealth inequality. Values are personal and everybody is different. The common thread is that you have to take care of yourself first before you try to change the world.



Guilt From the Source of Money


A financial windfall is a large amount of money that changes the rules of our financial game. Windfalls include legal settlements, pension payouts, insurance proceeds, inheritance money, and least commonly, lottery winnings. Financial windfalls are difficult to manage in and of themselves, but when the source of the windfall is tied to the loss of a loved one, it's very common to feel guilty.


When somebody on the left side of the wealth or income distribution receives a financial windfall, there are several issues to deal with. One issue is that the rules very likely have changed. The recipient will likely find themselves in a new financial neighborhood, possibly outside of their original financial comfort zone. In addition, if you're used to spending all the money that you get, having a windfall sitting in an account will give the impression that there is unlimited money. It makes it harder to make your money last because of the feeling that there will always be enough money. Additionally, we may subconsciously try to get rid of the money.


When you layer feelings of guilt on top of this, it becomes nearly unbearable. Nobody would intentionally trade a loved one for a pile of cash, but this is exactly what it feels like.


Recognizing that some things are outside of our control and that our time on Earth is limited, we can start to mourn our loss. Bad things happen, and bad things happen to good people. This is expected and a normal part of life. However, when it happens to us, it's harder to accept that fact. By recognizing that bad things happen is outside of our control, we can start the process of untangling these two events, something bad happening and receiving money. By separating these two events in our heads we can slowly start to ease the guilt that we feel about having money instead of a loved one.



Guilt From Cheating Ourselves


Sitting down to create a budget or a spending plan takes time and mental energy. Talking about money is not easy, nor is thinking about it. So if we spend this much time and energy creating rules for ourselves, we feel really bad when we don't follow those rules. This is especially true when we know we are breaking our own rules while we are breaking them. This is when we buy something online and immediately regret it. This is when we are debating a purchase and finally say to ourselves, “The heck with it.” It gives us a little bit of a high at the time, but we feel really bad tomorrow.


When we find ourselves feeling guilty because our behaviors and our values don't match, it's often because we've tried to create a plan based on willpower, restrictions, and deprivation. We often try to motivate ourselves with extrinsic motivation; motivation that comes from outside of us. This could be warnings, judgments, punishments, and even peer pressure.


When we notice this tension between our behaviors and our values, it is a good opportunity to explore our motivators. Intrinsic motivation is when we want to do something for the sake of wanting to do it. When we have intrinsic motivation, nothing can stop us. This stems from having the confidence to do something different, recognizing how important it is to do something different, and making sure that we're ready to make a change.


When we find ourselves not sticking to our plan, it could also mean that our plan is too restrictive. Take a look at your plan. Is it realistic? Does it have any chance of working out six months from now or a year from now? If not, it's probably time to revisit your plan.


Money Scripts and Beliefs About Money


All of our behaviors and beliefs about money are driven by our money scripts. A money script is a belief about money that lies below our conscious awareness. These are little rules that we don't know that we're following. One person might have a money script that says I don't deserve money. Another person might have a money script that says you should never spend money on yourself. Others might have money scripts to say I deserve to spend money, and I should always spend money on myself. Other money scripts are money is bad, rich people are bad people, you should always save for the future, things would be better if I had a little more money, or my self-worth equals my net worth.


Without exploring our money scripts, we won't be able to have access to the source of our beliefs and behaviors. And if we can't change our beliefs and behaviors, it would be very difficult to have any lasting change on our financial well-being.


The set of money scripts that we develop for ourselves determines our financial comfort zone, which is both the lower and upper bounds of income and wealth within which we are comfortable. A perception of having money that we don't deserve, or having money when others don't, is a signal that we might be above our financial comfort zone. Receiving a windfall can push us above our financial comfort zone. Spending money to try and purchase a lifestyle that we can't afford is a likely sign that we are below our financial comfort zone.


Understanding your money scripts is the key to understanding your financial comfort zone. Only once you know what your money strips are can you work to expand your financial comfort zone.



Focus on What You Can Control


It pays to get really clear about things that are inside our control and things that are outside of our control. If there is something that you can't control, then give yourself permission to let go of the worry related to that. Instead, spend some time to determine what things are in your control. You may be familiar with the Serenity Prayer. If there is something in your control, ask yourself what you can do to change it. If something is outside of your control, stop spending your energy worrying about it. Knowing the difference between things that we can control and things that we can't control will help focus our resources going forward.



For example, you can't control where you were born, the socioeconomic status of your parents, or how you were raised. You have no control over things that happened in the past. You don't have control of things that have already happened to you. Give yourself permission to stop wishing for a better past.


What is in your control, however, is what you choose to do about it. You have control over your outlook on your situation. You have control over the actions you take tomorrow and the next day. What micro action can you do today that is in your control?



Take Care of Yourself


There's an old saying that you can't pour from an empty cup, so take care of yourself first. If you find yourself in a situation where you feel guilty because you have something that others don't, you can't do anything for others if you don't first take care of yourself. Recognize and accept your situation for what it is. Get clear about what you value and what's important to you. Spend some time figuring out what you want to do about it.


If you find yourself in a situation where you received a windfall because something bad happened to somebody you love, you may find yourself back in your old financial neighborhood if you don't take care of yourself. Recognize the things that have happened in the past are outside of your control. Accept your situation as it is, and think about how you want to live your life going forward. Give yourself permission to grieve the loss of your loved ones, but don't do so in a way that sabotages your financial future. Ask yourself how your late loved one would want you to manage your financial windfall. Then spend some time figuring out how to do more of that.


If you find yourself in a situation where you feel guilty for the ways in which you spend money, spend some time exploring why you feel guilty. Was your spending plan too restrictive? Are you purchasing things to alleviate emotional stress? Do you believe that buying more things will bring you happiness? Spend some time to figure out what's important to you and how you can use the money that you do have to help you live more in alignment with your values. Brainstorm ways you can bring more money in. Perhaps you can take some training at work and apply for promotions. Maybe there's a side hustle that you've been thinking about pursuing. Figure out what's important to you and why, and take steps to create a plan that takes care of both present you and future you.



Money is associated with a lot of negative emotions. Fear, shame, envy, and anger are very common when it comes to money. Guilt is another very common emotion when it comes to money. You are not alone. Guilt isn't comfortable, but it’s manageable. Spend some time exploring the source of your guilt, the source of your beliefs, and what's important to you. Recognize that some things are outside of your control and that's okay. You do have some control over what you do in the future.


You only have one life. Live intentionally.



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Related Money Health® Reading
References and Influences:

William Irvine: Guide to the Good Life

William Irvine: The Stoic Challenge

Brad Klontz, Ted Klontz: Mind Over Money

Sarah Newcomb: Loaded

James Pennebaker, Joshua Smyth: Opening Up by Writing It Down

Massimo Pigliucci: How to Be a Stoic

Carl Richards: The One-Page Financial Plan

Simon Sinek: Start With Why


Note: Above is a list of references that I intentionally looked at or thought about while writing this article. It is not meant to be a definitive list of everything that influenced by thinking and writing. It's very likely that I left something out. If you notice something that you think I left out, please let me know; I will be happy to update the list.


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