You suck at money? That’s awful because money is security, so your health suffers. Your quality of life suffers.
Money can’t buy happiness, but it’s much easier to be happy if you aren’t worried about money.
Why do you suck at money?
You don’t follow the golden rule of money:
Do you spend more money than you should?
Or do you all on the other end of the spectrum, not earning enough money to reasonably sustain your life?
Figuring this out is the first step.
Lack of Financial Fortitude
This is a big problem of mine, too!
Fortitude is defined as courage in pain or adversity. I want to tweak that definition just a bit: Financial Fortitude is sticking to your financial plan in hard times AND in good times!
There is no temptation to go over my budget when money is tight. I mean I have no choice.
My problem is when there is extra money, or perceived extra (it’s never really extra). I get stressed or happy, and all of the sudden my mind shoots to “Well, let’s take the kids to Burger King and let them play in the playground to get away from it all!” or “Let me go out and celebrate!”
Nothing is wrong with either of these responses. Both are common and do make us feel better. However, both show a lack of financial fortitude.
Lack of Financial Know-How
Personal finance was not a part of my educational experience, even though calculus was.
While I was lucky to receive a rigorous education, I was pretty clueless when I opened my first bank account. And it doesn’t take calculus to figure out how long until I am broke again (that is insipidly predictable).
The sad truth is that the American public education system leaves out personal finance. And parents can’t teach their kids what they don’t know!
Everything I learned about personal finance I did because of self-study. I sought out books, blogs, podcasts, and anything else I could to try to take control of my money.
And I am here to share that knowledge so you don’t have to make the same mistakes I have.
Lack of Support
This is the biggest problem I see among moms trying to build wealth. We are scared to talk about our bad choices, and there’s not a place we can go to just talk about money, judgement free.
We need a place we can celebrate, without spending money, and we need a place that we can vent our frustrations without someone sneering and saying something tacky.
And I am giving it to you! Money Savvy Mommas Facebook group is a place you can do just that!
You can easily get better with your money. Like over night. Without buying anything. You just have to know a few things!
The marketing world loves psychology because it gives them the tricks they need to manipulate you.
So they use specific language to trick you into associating their products with success, good feelings, or urgency.
This has led to an entire world of shady but successful advertising protocols that help push you to make decisions.
My favorite example is the JC Penny pricing scandal. In 2014, an employee came forward accusing the retailer of marking UP merchandise so they could then put it on “sale” for the ORIGINAL price.
Cognitive biases that make you suck at money.
Cognitive biases are patterns our mind automatically think. They are not conscious decisions, and you probably don’t recognize them.
The most obvious one is the Denomination Effect. This is a phenomenon where people spend more money if they carry small bills (like $5s and $20s) than they would if they carried large bills (like $100s).
This happens because you think “I don’t want to break this $100. That’s spending too much money!”
But when you carry a $20 bill, you don’t blink at spending it on something because it’s “Just $20.” However, having this attitude means that you can quickly spend $100 in small bills without realizing how fast it adds up.
Get a big list of cognitive biases that affect your budget here.
Analyze your Needs
Are you one of the people who could make better choices or are your circumstances the problem? Is it a mixture of both?
What triggers you into spending money? Where does your money go?
Not sure where to start? I have a free printable to help! Sign up below to get it!