A recent Kiplinger article explores the strong connection between how we handle our finances and what our personal “money scripts” tell us. Brad Klontz, a clinical psychologist and certified financial planner, says that these scripts generally fall into four categories:
1. Money avoidance – putting off addressing financial issues (which can lead to overspending or underspending)
2. Money worship – believing money can buy happiness
3. Money status – equating money with self-worth
4. Money vigilance – always saving for a rainy day (which is often helpful but can become harmful if the plan is too rigid)
Money scripts are so powerful that a recent survey of financial planners found that around 25 percent of their time with clients is spent on non-financial issues, such as family dysfunction, divorce, death, illness, depression and spirituality, showing the need for a more holistic approach to money management.
The article recommends journal writing as a way to figure out the patterns and problems in our own money scripts and determining ways to fix them. Money journaling gives a new perspective that we can easily overlook in our day-to-day lives:
For many people, simply recognizing a problematic financial belief or behavior is enough to change it. Others need to work at rewriting dysfunctional money scripts. One way to raise your awareness is to keep a journal, jotting down thoughts that pop up in any given financial situation. The scripts are there, subconsciously driving behavior. Journaling slows the process, and it captures patterns in your thinking. Once you're aware of the patterns, you can work on changing them. Say you've had a bad day at work and your first impulse is to go shopping. Journaling puts some time between the impulse and the action, allowing you to make a conscious decision to, say, spend time with friends instead.
Sit down with your journal and write out your own personal money script. If your relationship with money were a play or a movie, what would be the main themes and the major plot points? What beliefs shape your script? Where did these beliefs come from? Are they accurate and helpful, or are they flawed and damaging? What habits have you formed – good and bad – because of your script?
Once you have identified some of the negative elements of your money script, brainstorm actions you could take to change your behavior. What are small steps you could take on a daily basis? What are your larger, long-term goals?