Financial Psychology | Behavioural Economics | It’s All Money and Emotion
There is a whole field of study around behavioural economics which I was surprised to learn when I started to do some research for this article. It’s in high demand and even has a Nobel prize available. To me, it all boils down to our ability, or inability, to separate our emotions from money.
My favourite money movie is Margin Call. There is a scene in it where the billionaire talks about what money is. He says something like it’s a tool we use so we don’t club each other to death over a hamburger. It made me reflect for a very, very long time.
If money is just a tool, then why did I feel so bad when I lost it all? Why did I feel like a complete failure at life? I lost everything therefore I am a loser. I couldn’t even buy a coffee.
It was this feeling of unable to participate in society and of being looked upon as less than that was the most challenging to my ability to get back up.
If you don’t have money, you can’t play the game. Any of the game. It’s all linked to money and if you don’t have it your choices are severely restricted. If you let it.
I have said before that I had an innate ability and understanding of money. This really came from my dad who was an accountant and a maths whiz. I think I just got it through osmosis but I knew how to manage it, how to save it, how not to spend it, how to find alternatives to spending, how to earn it, how to make it. I didn’t listen to or take on everything he said, and if I did I would be making about $200 an hour just to think had I stayed the academic course that I had originally wanted to and that he was desperate for me to pursue. I was too inpatient to get out into the world and start making money. Very short sighted in some ways, but as of today, I would still subscribe to this view. Again, ahead of my time.
Before I was in a relationship, I had my own relationship with money. I wasn’t obsessed with it. I just knew how to accumulate it and save it. I didn’t know exactly what I was saving for, but I knew I wanted to invest in the stock market and maybe buy myself a flat and to do those things I had to save a lot, because I was only making minimum wage because of my short sighted view of leaving university at the time.
So I had to get multiple minimum wage jobs and I did that. Saved all the money from two of them and lived on the other one.
Then along comes love. This was my emotional downfall. It also began my very complicated emotional relationship with money which up until that point had not existed. I had viewed money as a tool but it soon became a sign of my love. A gift I could give to help. A solution to someone else’s problem and unfortunate circumstances.
Oh boy – can you hear how naive I was? I sure can. But I also understand I was a product of my circumstances and it wasn’t all about being stupid and in love. It was about being emotionally vulnerable and hopeful that there was good in the world and maybe I had found it.
Nope. I walked straight into the worst and paid for it every step of the way metaphorically and actually.
It sucked me in like a black hole and it felt like a black hole that I couldn’t get out of. It slowly lured me in, piece by piece, meal by meal, rent by rent, tool by tool, car by car, house by house until I could separate myself from the fear of losing it all.
Once I faced up to the fear of having nothing. That all of my life had been financially worthless – I was able to leave. After all of my plans and scrimping and saving, when the time came, I walked out with $80, my car and the clothes on my back and my children. I imagined all of my worldly possessions and my grandparents heirlooms smashed to pieces and said so be it, instead of hanging on and protecting them for dear life – and my life and that of my children.
I was afraid of losing the things. I was afraid of losing all of my work and money. The fear of the loss was keeping me there – until it wasn’t.
We spend money for emotional reasons not practical ones. We disguise it as practical, we need tables and chairs, computers, phones, clothes, cars, and all the things. But these are constructs of the society in which we live in, within the first world. I’m not getting all high and mighty here I’m just saying that there are two things going on with money. Need and want. And the want turns our emotions into a need and the need is layered in acceptance and reward.
We all need to be accepted into society – mostly. Without money – it’s not an option. You have to have some money to get anything you want. Mostly. There are ways around this, but that’s for another post.
So this tool that was built so we wouldn’t kill each other, has become something that we will kill for. It is something we must have just to survive and something we need to prove our value to society in the goods and chattels we possess, the house we can live in.
When you add children to this, it becomes a million times worse because now you have to protect them and provide for them and make sure that they are not judged by your inability to provide and the whole thing becomes a hot mess of emotion. Over money.
Over a tool.
Losing everything for me, especially the money from my inheritances, has been cathartic, terrifying, uplifting and shattering all at once. I am a loser. I have lost. I couldn’t save a business I was sure I could. I couldn’t say no even though I knew I should. There was no more blood money in my hands that I was trying to protect out of the respect of those that had gone before me to earn it. I had lost it all through my own actions and felt a fool.
It took a while to get through that. It did not happen overnight. I didn’t lose everything and get up the next day and feel fantastic about and time to move on. I was devastated for a couple of months. Until I got perspective.
I was still alive. I still had my brain. OK so I made a HUGE mistake. People make mistakes. I’m still alive. That means I get to play again. I get to start again. I get to take everything I learned and apply it to me. I get to be my own client now. I get to give everything to me and my end goal.
To provide for my children when I’m not here.
I don’t care where I live as long as I have wifi and electricity. I don’t care what I eat as long as I make it myself and it’s vegan. I don’t care what I wear as long as I’m clothed.
I only care about what I can leave them. If it’s not monetary then it can be what I write. If this doesn’t work out they will have thousands of words and hours of video of everything I learned along the way to help them play the game.
Because it’s all a game. We are emotionally attached to a game on many levels. Now that I know this and can see this and I can play the game the way I want to ? I’m unstoppable and the emotion I had connected to money has gone and now I’m going to direct it to where I need it to go without the emotional baggage that I once attached to it.
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