- You can work with a financial therapist or a financial adviser to talk about your approach to everything from work to relationships, and the effects it has on your money.
- Need help with your money? SmartAsset's free tool can find a financial adviser near you
ADVERTISEMENT
Financial therapy isn't just for people struggling with money — it's for anyone who wants to understand how their thoughts affect their bank account
Financial therapy helps analyze what you believe about money and how those beliefs affect your behavior.
financial therapy
ADVERTISEMENT
In addition to helping you manage your budget, invest your money , and reduce financial risk in your life, some financial planners like Utah-based planner Dave Lowell are also focused on helping their clients develop healthier mindsets around money so they can meet their financial goals and live more balanced lives.
Lowell calls this strategy financial therapy, and he says it's helped many of his clients gain control over areas of their lives that once felt overwhelming.
Financial therapy isnt about numbers its about thoughts
ADVERTISEMENT
Financial therapy is typically an informal conversation clients have with their financial advisers or financial therapists about habits and mindsets that might be interfering with their financial goals or causing conflict or unhappiness in their lives. Basically, this conversation analyzes what you believe about money and how those beliefs affect your behavior.
Often, Lowell says, the best way to do this is to go back and examine some of your earliest memories with money and what lessons you learned for example, maybe your parents habitually paid bills late , and as a result, you feel a sense of insecurity around your budget. "Understanding these money scripts or unconscious beliefs will help you understand why you do what you do with money and what emotions come with it," Lowell says.
It's easy to compartmentalize our financial lives, but the truth is, our money and our emotions are inextricably linked. Financial therapy sets aside the logic of your financial situation and dives into the "why" behind your financial behaviors. Understanding these emotions can help you gain perspective on your habits and routines so you can ultimately change them.
"Why don't we do what we know what we should do? What keeps us from progressing to the next level and building real wealth? Financial therapy analyzes the subconscious beliefs we have about money so we can consciously override them and act more rationally," Lowell says.
Financial therapy includes discussions around work, relationships, and happiness
ADVERTISEMENT
Lowell says he frequently sees conflict between couples in which each partner has their own, contradictory belief about money, which can result in considerable relational and financial stress . "This often results in no budgeting, because it's too frustrating, and no real progress towards goals, since the topic is too sensitive to discuss," he says.
Another issue he sees often is over-spending, which he says is usually a result of believing that money, and spending money, will make you happier. "So you spend more to get a rush, but then the guilt sets in that you aren't being responsible with money and doing what you should be doing," he says. "So then you just spend more to fix that problem."
Another common mindset he helps clients with is workaholism the thought that once you hit a certain income, or have a certain amount of money, then you will be happy and you will have "arrived." "This results in sacrificing things that are actually important to your life in the present, like relationships or hobbies, in order to get to that predetermined point faster," Lowell says. "When you do arrive if you haven't moved the goal posts, so to speak you usually find you have sacrificed everything and still aren't happy."
Therapy isnt just for people struggling with money
Even if you don't have "out of control" financial behavior, Lowell says taking time to discuss your financial history and perspectives can be a great way to see your situation clearer so you can come up with strategies for managing your money that make the most sense for you.
ADVERTISEMENT
Lowell shares an example of a couple who had struggled with feeling guilty for spending money on themselves. "As we talked through why they felt that way, they realized it was because they felt they 'should be saving money' instead of spending it, which had been drilled into their heads at a young age," Lowell says.
In response, Lowell broke down their financial situation for them: They had plenty of savings and were being responsible with their money, so they could make room in their budget for spending without guilt.
"This shifted their mindset and let them feel joy about spending money on things they love," he says, "which has had a real day-to-day impact on their lives."
Need help with your money? SmartAssets free tool can find a financial adviser near you
ADVERTISEMENT
See Also:
FOLLOW BUSINESS INSIDER AFRICA
ADVERTISEMENT
Recommended articles
A look into the diverse tax reforms being implemented across Africa
Dubai firm to lend South Sudan $12.9 billion in exchange for 20 years oil repayment
China dethrones USA as the most influential global power in Africa: Report
Major African economies expecting inflation ease into next year, except Nigeria
10 African countries with the lowest price changes in household commodities
Dangote refinery outranks Europe's 10 largest refining facilities
Africa may just have the lowest level of cyber threats compared to other regions
A look into Kenya’s Shs1.1 billion climate funding from the UK