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What is the behavioral component and psychology of money? How do you deal with it tactically and practically? Your relationship with money is a big deal and makes a significant impact on your day-to-day decisions.
In this episode of the Finance for Physicians Podcast, Daniel Wrenne talks to Danielle Seurkamp, Certified Financial Planner (CFP®) and founder of Well Spent Wealth Planning. Danielle focuses on the behavioral side of financial planning and personal finance and helps individuals and families to effectively achieve their financial goals.
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Daniel: What's up everyone? I am excited to have a guest with me today. We're going to be talking about money, of course, but talking about your relationship with money. My guest today is Danielle. Danielle, can you give us a quick intro? Say hello to everyone.
Danielle: Everybody, I'm glad to be here with you. My name is Danielle Seurkamp. I'm a CFP. I am the founder of Well Spent Wealth Planning based in Cincinnati. I am fortunate enough to be in a study group with our illustrious host, Daniel.
Daniel: Yeah, illustrious. It's good work. Danielle's not given you the full story. She's got an incredible background. She has all these designations and has all sorts of great involvement in our industry.
If I was to boil down, Danielle has kind of gravitated towards the behavioral side of financial planning and personal finance. You have certified financial behavior specialists, that's one, and then you have a Master's.
Danielle: Right, yup. Actually, my Master's was my first kind of introduction into the psychology of money, and behavioral finance, and the relationship we have with money. I'm really happy that I took those courses, and then that just started my interest in IT. I went from there.
I got involved with the financial behavioral specialists, which is through the Financial Psychology Institute. I was able to learn a lot in that program by just going right up to the edge of psychology and bringing in some of that information into the way that we deal with money. It made me move to the practical side.
Daniel: Yeah, we're both financial planners by day. Most financial planners you talked to will acknowledge this whole behavioral component and the psychology of money. We have an appreciation for it. We realize it's a big deal, it's something you should be paying attention to, and that sort of thing.
For example, for me, when it gets into the tactical aspect of it, or problem solving, or how to work through it. I'm not an expert by any means. That's what's been cool about Danielle. What you're doing is you've dug in more to that aspect. It's a big deal. We're going to talk about it today, what we're talking about as far as behavioral finance and relationships with money.
When I think of relationships, I know I think about people. I'm like, what are you talking about, relationship with money? But everybody has a relationship with money. We see it every day in our work with people one-on-one. Danielle has just taken that initiative to really dig into that. It's impactful stuff, because once you understand this, you'll start to realize this is the undercurrent for a lot of the things that we do day-to-day and the decisions we make.
Danielle: Absolutely, yeah. I guess maybe just to kind of kick off, what does this even mean? What does the relationship with money even mean? What do we think about it? The way that I think about it is, okay, let's talk about financial literacy. The definition of financial literacy is the ability to use knowledge and skills to manage financial resources for a lifetime of financial well-being.
You hear knowledge and skills there, and that's the part that a lot of people focus on. But the part that has more to do with our relationship with money is the ability to use the knowledge and skills. That's the important piece that this relationship with money brings in.
When you think about that, you might think of our relationship with food and exercise, just that basic idea of, okay, I know I shouldn't have had doughnuts for breakfast, I know I should have probably got up and worked out. These are the basics of having a healthy body and mind.
If I'm feeling crummy, I'm tired, I'm stressed, I'm lonely, whatever it might be, I'm not going to be able to use that knowledge. I'm not going to get up and eat the thing that I should. I'm not going to get up and work out. It's the same way with money. Really when we think about the relationship, you said it was about people, and it is, but it's about our knowledge of ourselves and how we relate to money.
Daniel: Yeah. It seems like everybody or the general focus, like you said, tends to start on that knowledge and skill. That's where a lot of people go, and a lot of people stop there in terms of what they focus on. They focus on educating themselves, which is all good stuff. That's important.
Learning the skills, and the tactics, and the proper technique and of maxing out accounts and whatever, and making more money. People spend countless hours focused on those sorts of things, and building wealth, and whatever. It's also kind of more of a shiny object. People enjoy, I think, reading about that kind of stuff or understanding that stuff.
It seems like this is more of one of the things that has a tendency to be overlooked. People look at how they relate and it's, like we said, super important. We both said it's really important, but why is it so important? If we boil it down, why is this so important to understand?
Danielle: I think it comes down to, knowledge is pretty useless if we're not able to apply it. The things that get in the way of our ability to apply it are either the mental biases we have, cognitive biases that are just errors and thinking that apply to everybody. Everybody has these normal things, where our brains just don't necessarily always reflect information the right way.
Just as an example, if you've seen three news stories about an airplane crash, you're probably going to think their plane crashes are going up in likelihood or they're happening more often, even if statistically, they're becoming less often. They're just errors and thinking around our brain that all of us experience, but then there are these emotional biases as well that don't apply to everybody the same way, that have a lot more to do with our individualized experiences, our day-to-day well-being.
Either one of these things can get in the way of our ability to use good financial knowledge and skills. If we're not able to get over the hurdles of those things, then all of the best financial planning, or all of the reading online, or whatever we do to educate ourselves and try to do the right things, aren't going to be as effective and may not be effective at all, depending on how intense some of those things are.
Daniel: Right, yeah. I've seen it in working with families one on one. It seems like it commonly surfaces or comes up. They're articulating these values or priorities. We have given them concrete steps to make progress towards the goals, values, and that sort of thing.
In other words, they have the knowledge of what steps to take, but they're continually failing to execute on it over and over again. A lot of times, there are some underlying issues in regards to their relationship with money.
Danielle: Absolutely, yeah. I think that one of the themes of being able to hone your relationship with money is noticing things. If you are having an experience where an advisor has told you something to do, and you have felt resistant to do it for whatever reason or you haven't taken action on it, that's actually a really good indication that there might be something around that topic that is causing you to have a little bit of resistance, or hesitancy around implementing those recommendations. Or, you've just been stuck on something that is a good place to start digging in, looking at what's going on there, and what that might be for you.
I was going to give you a little story here just to illustrate what we're talking about as we start to explore these emotional biases or these things that come up in our relationship with money, just to give us a framework of a place to start. Does that sound okay?
Daniel: Yeah, I always love stories.
Danielle: Okay, this is about Billy and Bobby. They were eight years old. Both of them saw a bike that they wanted to buy in the store window. Both of them decided to save money for it. Billy kept his money that he got from birthdays and holidays. He asked his mom to do extra chores if he could make his own lunch, save his lunch money, and even do some things for neighbors and grandparents.
Finally, he got enough money to save, and he bought this bike. He loved it, he rode it for years. That's Billy. Now we have Bobby. He also started to save money. He did extra chores and he sold some of the CDs.
One day when he went to put some of that money into his little piggy bank, he found that everything was gone. His older brother had taken it from him, and there was no way that he was going to get it back. His brother actually threatened Bobby and said, if you tell anybody, I'm going to make you really sorry. Bobby was afraid to even say anything about it, so he didn't. He just started basically saving again on the side, but hid his money a little bit better.
Finally, he gets up enough money to buy the bike. Then less than a week later, the bike was stolen. You have two situations here that are very different. I'm just curious. Daniel, what do you think about when you hear that story? What do you think the impact of Billy and Bobby would be in that situation?
Daniel: It developed some skepticism around or at minimum towards other people. Maybe you even put blame on the money. I don't know. Having money causes these problems. You can connect the money to the problem, I think. More money, more problems—the little little kids version.
Danielle: Exactly, yeah. Right, the eight-year-old version of this. That's exactly right. Most people are not going to think back to childhood and necessarily think, oh, my whole relationship with money boils down to what happened when I got this bike when I was eight years old. But these are the kinds of experiences that end up shaping how we interact with money.
I would say that experience for Billy and Bobby, I would describe that as a financial flashpoint. That basically just means that is a moment in life or something happened that was significant enough to shape your views about money. It can be a one time thing like this.
This was an isolated incident around this bike, but it can also be something more just every day. You saw a parent consistently in debt, overspending, or whatever it might be. It doesn't have to necessarily be a huge deal. But what happens is, then, we have these flash points. We're kids, we're growing up. We don't have the framework to necessarily talk ourselves through the rationale there.
We just know, this experience, if you're Bobby, was painful, and I don't want to feel that way again. What happens is we make a promise to ourselves something like you said, Daniel, I'm never going to be stolen from again. I'm not going to be a victim of that again or whatever.
You're trying to avoid that feeling of fear, so the behavior that might come out of that is that Bobby might not save money anymore because in his experience saving up money, got his brother steal from him, buying the bike, got someone else to steal from him. He may have a negative feeling about saving money.
Going forward, just from that, it could carry through his whole life. That's just one example of how these experiences, these financial flashpoints, can then turn into these promises that we make to ourselves or these beliefs that we have that are sometimes called money scripts, because we replay them over and over in our head. That's just one little example of how you can flow through in the behavior.
Daniel: Yeah, I like it. It's basically equating money to painful experiences. Everybody wants to avoid pain in the future. I think the issue is that we often bury it and aren't aware that it's affecting your day-to-day world.
Everybody has a past that is affecting their day-to-day world. Sometimes it causes problems and you're burying it. That's where therapy can come into handy and digging into the past. Maybe before we go down that route, what's a good way to start to identify your own flashpoint?
Danielle: I would say, first things first is just start to think about your past. In light of hearing how a story about a bike can have that big of an impact on you, start to think back. What are the financial memories that come to mind? What do you remember about money and your childhood?
Just to give you a little more of a prompt to think about that, there are a variety of different things that could impact your beliefs about money or these experiences that you've had about money. A few things to look for as you're going back and analyzing your history. Things like gender roles in your family, who was responsible for paying bills? Who was responsible for earning money? Who did those things? Those types of things can carry forward into the future.
Even gender norms in our society can affect how we feel about money. There's actually a really interesting study that T. Rowe Price did about boys and girls as kids and the relationship parents had with them. Boys were talked to by parents about investing and in starting businesses. Girls were talked to about money, with paying bills, coupons, and stuff like that. Even little things like that.
Again, this doesn't necessarily draw back to one significant event, but it does sometimes shape how we think about ourselves in relation to money. Am I really someone who can start a business? Am I somebody who should be paying the bills?
Looking at the professions and education history of your parents and family. What kind of spending behavior did they have? Did anybody have debt? Were they good savers? Even stuff like what were their relational issues in the family, like addiction, enabling, secret keeping, all of this stuff can flow through to how we relate to money.
Those are just some thoughts in terms of where to go back into the past and start to think about, where do my money beliefs come from? There might be specific moments in time that relate to these different things. It also just may be the way that you were raised and brought up everything from the socio-economic status of your family to just the individual roles and challenges that parents had as you grew up.
Daniel: Yeah. I've done an exercise before. I don't remember what it is called, but draw a visual representation of your youth. I guess you started by thinking back in the past, all the way growing up, and the financial key points, I guess, from your memory. Then you draw a picture about it, and you kind of map it out like a timeline or something along those lines. What are the takeaways, that sort of thing.
My parents were very unwell or they had a lot of financial challenges. I think some people come away from that. You get in the cycle of that's how it is, and then other people come away with that. It's like, I have to work really hard to avoid that situation. That completely is part of what has caused me to be how I am financially.
It's probably what drove me into the profession I'm in, which is helping people with money. I was basically acting like a financial planner in middle school or something. Looking back at that type of stuff is really helpful. Also you can find underlying issues, like you said, and identify maybe these hurdles that are holding you back in life.
Danielle: Yeah. I actually relate a lot with that, Daniel. I had a lot of financial insecurity growing up as well. Those are moments, again, where what comes to my mind is I'm going to make a promise to myself. For me, I can think back to a very specific moment in college where I was going to school full time and working full time, and I was balancing my checkbook, and I had $7 for the next two weeks, and I was just feeling really broke.
The stress of that was meaningful for me. The promise in my mind is I'm never going to let myself be broke again. I'm not going to let this happen. It may have been different for you in what kind of thing that you decided on or whatever. What happens from that can be positive or negative, in my case.
It sounds like in your case, too, it drove you into a successful profession, made you focus on earning money, all of those things. That's good. But I think that tricky part is, when we make these promises to ourselves, sometimes we only focus on the part of the truth that suits what we've been through.
In my case, where, as an example of where this promise to me came into conflict with something that I wanted to do, was I had this feeling of never wanting to be broke again. Then at some point along the way, I started having the urge to have my own business. Those two things do not go together.
Giving up a nice, consistent W-2 income to go out on your own, start a business, and take risks around money does not really align with this fear that I had or this promise that I made to never be broke again. This is where we start to run into our own promises that we've made. We have to work on that. It took me a long time of working on that, to be able to go out in my own business and take the risk financially, and be able to tolerate the fear that went along with that.
The part of what helped is doing kind of the devil's advocate against your own argument. For me, it was, I don't want to be broke again. If I start a business, I'm going to be broke. I'm going to have financial insecurity again.
What sometimes can be helpful is to say, what argument could you make to me about starting my own business where I wouldn't wind up broke? There are plenty of things that you can say to me, like, you may earn more money, you may have more control over your job security. There are lots of arguments you can make on the other side. But when we have this emotional block, we don't make that counter argument.
That is another place to start. If you feel really strongly about something financially, just try to play devil's advocate. I call them financial half truths. Another one might be like, all debt is bad. If you really have a bad experience with debt, all debt is bad. But if you don't take debt, you can't go to college.
Sometimes, you can't buy your first home. You can't necessarily start a business. There's good debt and there's bad debt. If you have a stuck belief in there somewhere, it helps to kind of make that counter argument to yourself.
Daniel: For me, coming out of one of the effects of my childhood is I guess a promise I made. It was like, I'm going to work extremely hard, professionally, or whatever. Like in high school or whatever, manual labor or whatever I could get. Work extremely hard to make sure I never have that financial stress or problem ever again.
Fast forward, that inevitably causes problems, because that's not my only value. If I work extremely hard, eventually, and I have a family, three children, and I am not seeing them any, for example, that starts to cause problems. Maybe I already have plenty of resources financially and I'm still working hard. That's where you get into that cycle and all of a sudden, you are having marital problems, maybe you're divorced, or maybe potentially, one of the causes might be that I worked so hard.
That was the sole focus, because for me, it was a big, huge focus. I was like, this is a high priority. It has caused problems in my marriage here and there. I'm fortunately still happily married.
Fortunately, I married a woman that will bring up problems, raise them to my attention, and that sort of thing. Even me, personally, it could have gone several different ways. This hard work ethic could have been ultimately causing tons of problems in life, especially when I'm not aware of it, or I'm making excuses for it, or that kind of thing.
Danielle: Yeah, I think what you're talking about is so common. In our experiences when we're young and we think about it, how can I fix this? How can I fix this problem? I don't want to be financially insecure really, really hard and never feel that way again.
Sometimes that works, and you've seen that. You've seen positive things come out of that. You have a successful business, you're able to take care of your family, and all of these things. Eventually, this same solution to this problem can become a hindrance in other areas. What we've been doing doesn't work anymore in the same way that it used to. That is sometimes the time when we become aware of the fact that we've been holding on to belief.
I don't want anyone to say that they should throw away the beliefs that they've held. It's not that. There's another side to the story that you need to make to yourself and say that, yes, working hard is important. I will continue to work hard, but there's no point in me working hard if I'm not going to be able to see my kids, my family, have time with them, and that sort of thing. What you're describing is often what happens when we would come up with a system to fix the problem, and then eventually, that system doesn't necessarily work for us in our current situation.
Daniel: I think a good place to be is where you're aware of this underlying relationship with money—your background and the cycles of how you believe around money. Then on the other end, having awareness of what you value. I think if you can look at the two of those, your relationship with money on one hand and then your values in life on the other hand, it seems like those two things, together, is where you can really start to make good progress.
I find that all of it conflicts with each other. When you're not aware, that's the problem. When you're not aware of either one of those, we're talking about the relationship with money today, but either one of them, when you're not aware of it, that's where it's dangerous.
Danielle: Right. Yeah, and I think that part of the reason, a lack of awareness is challenging, is that whatever we believe or whatever we're doing is probably to cope with some kind of feeling that we're having. If you're not aware of that and you're not aware of how you might be using money to cope with that feeling, then you're not able to necessarily understand your own needs, and find another way to cope with it.
As an example, you might have a fear around spending money. That's a pretty common one, I think, that we sometimes see in our business. People have saved a lot. They've worked hard. They've pinched pennies and all of that stuff, but then they have a hard time spending that money. A lot of times, it comes back to some of the stuff like we were talking about, financial security and our past, that sort of thing.
If you really drill down to that at a deep level, money is how we provide food for ourselves. It's how we provide shelter for ourselves, and it is how we stay alive. To not have money is a huge, huge fear for people. That fear runs pretty deep. It may not necessarily be financial insecurity that you necessarily had that's feeling it, but there are also things like fitting in.
We grew up in a certain socio-economic world. That's what feels comfortable to us. Sometimes being wealthier, that doesn't feel comfortable. That gets down to being ostracized from your group. Again, this gets down to survival instinct, where we're doing things in a sense to keep ourselves safe, so we have to find that awareness around that to say, how can I make myself safe in a different way?
Just understanding that there is depth there. A lot of times, if you're not spending money or if you are spending money, it can be in response to those deep emotional feelings. But we have to find another way to sort of address them in order for us to make our better choices, financially.
Daniel: Yeah. Do you have any suggestions for gaining better awareness? I know, we've thrown out some ideas for people. That's a hard thing to do. It's easy to talk about, but blind spots are hard to see.
Danielle: Let me throw out a few. I'll throw out a few examples that may resonate with people. Then we can talk about some ways to work on this if you need to raise awareness or keep digging into this a little bit.
Here are some examples. Again, if the feeling that you're having is fear and your behavior is not spending, you might look at things like financial insecurity in your past. That behavior that could come out of that might be not spending money, it might be keeping secrets from somebody, hiding money, that kind of stuff. Look for that sort of thing.
If you're feeling sad, stressed, guilty, bored, your behavior might be to spend money. Things you might look at there are spending as a coping mechanism. I spend it when I'm sad. I spend it when I'm bored. I get online and shop. Coping with those feelings is one thing we often do, so look for those patterns there.
Look for when we're spending money to fit in and stay safe. This is the Keeping Up with the Joneses thing, but it's at a deeper level. It's like we want to be accepted by the Joneses, so we need to spend money to look like our neighbors and all those things. Looking for the patterns around that can be helpful.
Looking for things like status. Like, okay, one of my guilties is I like to give really nice gifts to people, which, okay, does that sound so terrible? No, but I stress out about that. I will probably spend more than I have in my budget, because what someone thinks about me when I give them that gift matters to me. That's a status thing, just like it is to drive a nice car, or have a nice house, or have nice clothes, or whatever. That's a status thing.
Maybe that sounds shallow, but really, it's about my self-worth and being accepted from other people. Those are the kinds of things we can look at in terms of reasons why we might spend money. Coping with a negative emotion, trying to fit in and stay safe, trying to demonstrate our worth or fit in with people. It even sometimes can be as simple as like, I deserve this, I worked my butt off, thoughts like that.
I know you have a lot of doctors that listen to this, and you struggle through residency and you're broke. Then it's like, okay, I finally got the job, I have the money. The feeling might be that I finally deserve to spend this money. All those kinds of thoughts can get in there. Just paying attention to those a little bit is really helpful and bringing that back to, where is this really coming from?
Where is this need in Danielle to give fancy gifts? Like, why do I even care about that? Where does that come from? Just kind of thinking about that a little bit more.
Also, keep in mind, none of these behaviors are necessarily problematic, unless they're causing problems in your financial plan or causing problems in relationships. Spending or not spending is not inherently bad or good. It's just, how is it working for you and your situation?
Daniel: Yeah. I think that you hit on a couple of good ones that are, I think, a lot of you listening probably have felt the pull of or experienced before. The desire to reward yourself or it's been a long, hard road and I deserve to pat myself on the back, some people take that.
First of all, that's not a bad thing, like Danielle was saying. It could be a great thing, but some people take it way farther than other people. It seems like a house decision. A lot of people have that right around that time, too.
In my experience, I noticed that a lot of the struggles, physicians, especially, a lot of it comes down to those decisions made in the transition points in time. But what happens is, say it's like the ultimate underlying desire is patting myself on the back, I need to take care of myself a little bit, and maybe they go a little too far on that. It seems like what sometimes happens is that you bury your head in the sand.
Some people get it and are like, okay, a mistake or I'm aware and it's causing problems in my plan. But other people are aware of it, but they're not really recognizing that it's causing problems. They just work through it or maybe work more hours to try to make more money. It can cycle down the other direction.
Maybe I'm listening and I'm feeling like I'm aware of it. I'm like, I got that. I realized I need to pat myself on the back, and that's what I did. I don't think I took it that far.
I don't think I have any problems in my plan, but I'm kind of not saving anything or I hired a financial planner and didn't take their advice. We see that sometimes as if people don't take our advice. It's like, are you working with us? It's hard to self-identify that sometimes.
Danielle: Yeah, and I don't know that it happens immediately. I think it's just noticing, noticing, noticing. Practice noticing what you do and when. If you just went through an experience where you did YOLO and went for something, because you really felt like you deserved it, worked hard for it, and that's what happened. You're like, I don't know if that's bad or good, or indifferent, or whatever.
You might just pay attention, like, how was I feeling around that time? Maybe you're really tired. You're exhausted from overwork. You're just not feeling the good stuff that you need to feel or you're not balancing something else. Then start to think about, okay, what do I do when I feel like that?
When I'm tired, and I just like worked my butt off all week, and I just really don't have the energy to go coupon clip or whatever the thing is, what do I do in that moment when I'm ordering dinner? Do I go shopping online? What do I do in those moments when I feel that same way that might have led me to make that decision?
It's really just thinking a little bit more about it. I can give you an example of something that I did if that would be helpful. I had a habit of every time I was invited to a big networking function, where I wasn't going to know a lot of people, I had a habit of going out and buying myself a new outfit. This outfit was super important, because to me, it was my armor going into these events, and I needed to fit in. That was what made me feel okay to fit in to these things that I was going to.
I go and shop. Even though I have financial insecurity in my past, and financial security is a big deal to me, that need got subjugated to the need to fit in at this event. Sometimes we even have ones that contradict each other. This is an example for me, where I have things that are contradicting themselves.
The need to fit in was more urgent for me at that moment than the need to have financial security, so I went out and I'd shop. I would stress out and walk around the mall. I'd always spend more than I needed to, and it will kind of mess up my budget sometimes.
I finally started to just have the negative emotions of like, oh, I'm running through this mall, my feet are killing me. I've worked all day, I'm just trying to find this outfit. Why am I doing this? What I started to do was just say, okay, I'm going to pay attention to what happens to me when I get invited to these kinds of things. What I noticed was I have the urge to go out and get my armor.
In those moments, I started to do something differently. I would say to myself, all right, I have a networking event in a week, I'm going to go through my closet and search to pick something out that might feel appropriate for me. Sometimes I would still go out and shop, but I knew what I was doing at that point. I knew I was doing this to make myself feel better. That helped, even when I did it anyway, because I knew what I was doing.
That doesn't come up for me as much anymore. But it took me time to figure out that I was doing it, first of all, and then to figure out, why was I doing it? Why was this need so important? And then, how to take care of myself in a different way?
It's not just, don't feel like that anymore, Danielle. It's, okay, I'm going to feel this way a little bit. How do I care for myself in a different way that doesn't necessarily mess up my finances the way it would have if I just went out and blew a bunch of money on clothes?
Daniel: Yeah. That's just good awareness in general. Like you said, even if you continue doing it, to some extent, awareness is the key. Was this one of the symptoms like, maybe the closet is getting full of the stuff that I'm not wearing? That could be an observation you make.
Danielle: For me, it was the negative emotions. I am putting myself through this insane shopping marathon. Why am I doing this? I'm not happy. This is making me unhappy. Again, what I was doing was working for me and making me feel safe, but now it's causing me to stress out, go crazy, and make myself nuts about what I'm wearing.
Something will come up, maybe, something that doesn't feel great. That is a time to just dig in and notice a little bit more. There are a number of different exercises and things you can do as well. I'm happy to share any of that if you want.
Daniel: Yeah, I would love to. I'll go back to that. I wanted to throw something out there. The career track of medicine is a challenging one and that it takes you through the training, especially. Sometimes the training, rigorous hours carry forward or you get used to it and you just keep doing it.
I think the challenge there is, for me at least, when I'm killing it, grinding it out on whatever it might be, like work especially the one that can take over, when it's taken over, it's like I don't even have any capacity to be aware of anything. It's like I get in this zone, I guess. I feel like this type of awareness requires having some space or something. I don't know how to describe it, but I feel like it's much more difficult to get in that mindset when you're so overwhelmed.
It might even be something different at work. It might be some challenge, or emotion, or grief. I think when people are going through grief, they just can't. They are totally overtaken by it. Sometimes that's okay, but I just think that's a good thing too—because in training, for example, a lot of times, you do much about that, so you just have to do the best with what you have, and work through it, and don't be too hard on yourself. Has that been your experience, Danielle?
Danielle: Yeah, and I think part of what you're talking about is there are moments where we don't have the capacity to be thinking rationally, and be self-analyzing, and all of that. That capacity for that is really important. It's actually why this relationship with money matters, because when we're regulated, calm, and feeling good, our thinking brain is able to make more of our decisions for us.
Our thinking brain is the one that understands, like, okay, I need to delay gratification, I need to save for the future, I need to do whatever I need to do for myself rationally. But as soon as we're overtaken with emotion, and whether that's the stress of grinding it out at work, or grief, or whatever it might be, panic about an event you're going to, it is very difficult at that point to use our thinking brains. They go offline.
Our emotional brains take over. When our emotional brains take over, and we're trying to protect ourselves, or soothe ourselves, or whatever, it's very, very difficult to make wise choices that are based on the future.
Daniel: In any area.
Danielle: Yeah, exactly. You can't expect yourself in those moments necessarily to be able to do anything about them, but it's what we do when those moments pass. We reflect on them when we think about what's going to happen, when another moment like that comes, when we can try to decide to do something differently. We do have our wits about us.
Daniel: Right. It's like taking a minute. For example, with the training, taking a minute in between training and starting your first job might be a healthy exercise. I've worked with many people that go straight into practice, but taking a month or at least a few weeks.
It's going to be chaotic anyway, but give yourself some time to take a silent break or something and observe it. Maybe you look back and you realize this kind of thing in your case, and you're like, oh, that's important to know as I look at future jobs. I don't want to get myself in the exact same situation as I was before, where I got the blinders on and I'm just crushing it at work, but that's it.
Danielle: Right, yeah. I think, like what you said earlier, that's a great opportunity to sit with your values for a little while and say, okay, I'm looking for a job, what do I need out of this job? That might be financial security. It could be a certain level of income or whatever, but it might also have these other things. That's a great opportunity to check those decisions in those moments with values and things like that.
Daniel: Yeah. I think it's hard in our culture or maybe even professions you choose. Sometimes it's very difficult to just have that space. Everybody's afraid of boredom or with all that stuff going on. You have social media and smartphones—I'm guilty of it.
You're looking at your phone when you're bored, and it's difficult. You almost have to be really intentional about allowing for a minute to think about stuff like this, observe awareness, journal, or whatever. It's possible. You can do it, you just have to be intentional.
The other thing I wanted to mention was I think it's been helpful for me to listen to other people. Maybe that sounds obvious, but I have been guilty of not listening to other people, kind of warning or raising the red flag. Especially the people that are direct and honest, that you trust. For instance, my wife is super honest and direct. When she says something, it's more than likely very true.
It's hard to hear that. I want to not listen, but listen to those people because they'll throw out the warning signs, those people in your life. They'll be hints, I guess. Maybe there's this issue and I think, sometimes, it can tie in to all this stuff.
Danielle: Yeah. The other thing is sometimes we find out about some of our struggles from other people, because it's a lot easier for them to see it than it is for ourselves. Even in marriages, a lot of these things come up, a lot of the stuff we've talked about. Imagine if one person is motivated by an intense fear of going back to being poor, and someone else is super motivated by wanting to have nice things and fit in with their crowd. One's going to save, one's going to spend, generalizing, of course.
The reason that's so hard to reconcile in a relationship is because the needs are very intense for both of them. It looks like, oh, my God, you're so cheap and, oh, my God, you spend too much money. Really, it's a lot more than that. Even when we hear it from someone else, it's like, oh, you're being cheap. Well, I can't just stop saving money, because that's what keeps him safe. In my mind, that's what keeps me safe.
Even sometimes, when we get the message from somebody else, it's hard to reconcile or take it in, because letting go of that behavior feels like letting go of what's keeping you safe. In reality, some of that is keeping you safe and some of that is causing you conflict in your relationship, or in other areas, or whatever it might be. The hard part is then examining that and seeing what you're doing maybe isn't serving you the same way it used to.
Daniel: Yeah. Let's go back to some of those exercises. As we wrap up, maybe we can talk about you mentioning some exercises or tactics to kind of help.
Danielle: Yup. The basic one is just notice, notice, notice—pay attention. How do you feel? How do you act when you feel that way? Some people will actually do a journal around that and say, I went shopping, because I was feeling stressed about going to an event or whatever, so keeping track. Even journaling around that can be really helpful.
Daniel: And writing about your feelings?
Danielle: Yes, the horrible thing of paying attention to our feelings.
Daniel: I am not very in touch with my feelings. It's important, I think, to clarify that I have to be very intentional if I'm going to write about my feelings and remind myself, because I have journaled for years, and years, and years. If you read my journal, it's probably not very feeling-oriented. It's going to be difficult for you to get an idea of what I was actually feeling, unless I was really intentional about it. Reminder for those of you that are like me, you have to remind yourself to talk about those feelings.
Danielle: Yeah, and to think about it. It's hard. A lot of us do avoid our own feelings. Like you're saying, it's easier to get on social media than it is to think about how we feel, because sometimes it's not great how we feel. It's hard to go there.
It doesn't have to be a long journal. It could just be what happened, how did I feel, what did I do about it? All it is is just trying to raise that awareness. How will you keep track of it? Is that a work for you? Just paying attention to it can be really helpful.
Another thing, we've been talking about these promises we make to ourselves. If there are any promises that you've made yourselves or beliefs that you hold strongly, if you don't think about it as a promise, whatever it might resonate with you, write it down, and then think about how that flows through financial behavior, and then try to make the counter argument. Again, just being devil's advocate in a very intentional way of pushing back against what you consider truths, but might actually be half truths.
Daniel: Yeah, even though it goes against every grain of your inner being. That makes absolutely no sense. I'm not going to justify the opposite of my belief. That does not even make any sense to me. But go against that, like the urge, that it makes absolutely no sense to make a counter argument about something you've already made your mind up about completely.
I can tell you, it's worthwhile to make a counter argument about something you're already 100,000% committed to or believing in. At a minimum, you can start to gain a little bit of understanding of appreciation or even seeing other people in how they view things, but sometimes it'll surprise you what you come up with.
Danielle: Right, exactly. It's a lot easier to argue with ourselves than to have someone else tell us the other side of the argument, because we're pretty much guaranteed to ignore the other. We need to come to run our own, which is hard.
Okay, a couple other things. You can do a genogram, which is basically a chart of your family history. Just google genograms. Basically, you would just draw out your family history. There's a lot of detail you can add to it, it's up to you. But if you're really trying to figure out patterns or things that might have been held over from previous generations or upbringing, it can be really helpful to look at something like that just to see what comes up. That's another technique.
There is a quiz you can take. It's called a money script inventory. If you google that, you can take a quiz and find out. If you fall into one of the main four kinds of money scripts, avoiding money, seeing money as status, seeing money as the solution to everything, and then being very vigilant about money, those are the big four that you'll fall into. You can kind of see, does any of that resonate? That's another thing you can do to gain awareness.
There's also just that value piece. I don't know if you have anything, Daniel, but if there's a miller values exercise out on google that has basically a huge list of all the values that you might hold, and if you're trying to get clarity around what those values are, that can be helpful, and then looking at that against what your current financial behavior.
Daniel: Those are good. Coincidentally, I think the episode that's going to come out before this one, I talked about different values exercises.
Danielle: Oh, perfect.
Daniel: There's a bunch of different ways to dig into that. I'll link to each of these in the show notes so you guys can see that. There's a bunch of different ways to tackle this. The last thing I wanted to ask you or I was thinking about is we talked with your friend, actually, many episodes ago about financial therapy. You know what that is, and we cut into some of this stuff a little bit, too. In your view, at what point do you seek out help specifically for this?
Danielle: If you're looking at the situation, and your finances are in trouble, or your relationships are in trouble, and you're just not finding resolution in the things that you're trying, then financial therapy can be really helpful. It's basically just a format or you and your partner to be able to talk about these things with a professional that knows all of the details, that can walk you through some of this more intentionally, and do it in a way that holds space for both people's feelings, and those people's needs, and all of that.
They also have the expertise around money to bring into it. That's the unique thing about financial therapy. You get the emotional component, the psychological component, but then you also have the financial component, at least, understanding there to bring that into play as well.
The moment that I would seek someone out is if you're really in a situation where there's a problem that you're just not finding resolution toward, and maybe something like this could be helpful. Financial planners are helpful too, financial coaches are helpful too, but definitely financial therapists or certified financial behavioral specialists are going to be the most experienced with these particular issues.
We all have them, so don't feel bad. Every single one of us has beliefs about money. It isn't like there's one for all of us. It's so many different ones that make up how we feel about things. Really, it's just about getting to know yourself better. That's sort of the thing with life, right?
Daniel: Yup. It's sometimes complicated. Sometimes we don't want to dig into it, but it is worthwhile to dig in at least, especially if it's causing problems. Even if it's not, it's just good awareness, because eventually it can. That's how it's been for me. It's like, oh, some of these issues or past experiences weren't causing issues, and then they were a little bit, and then now they're not. It's a cycle.
Danielle: Yeah, absolutely. Sometimes the consequences aren't that easy to see. For me, if I go back to that hole of financial insecurity and wanting to start my business, if I hadn't dealt with that fear that I have, I may never have started my business then. Would that be a problem in my life? Maybe, maybe not. I probably would have been fine in a lot of ways.
A problem can also just mean you're not fulfilling something that you want. It can just be a barrier in that sense, too. It doesn't necessarily mean like, oh, your finances are in shambles and you're on the verge of divorce. That's not the only situation where you might need a little bit of extra time here. It can be just when you're trying to take something new on or like you said, in a moment of transition can be helpful things to think about.
Daniel: Right. Awesome. Danielle, it's been fun. I enjoy talking about this stuff. We could go on for hours, and hours, and hours. But we both have lots going on. Thank you for coming on. I really appreciate it.
Danielle: My pleasure. Good to be with you.
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