How To Break The Cycle Of Shame Around Money

Cycle of shame

Do you ever look back on certain money decisions you’ve made in the past and thought, “My gosh… how could I have been so careless?!” The shame and humiliation feel real — and the more you think about it, the more embarrassed you become. In times like these, you may be experiencing a cycle of shame around money.

Learning how to break this shame cycle and heal your relationship with money can help you shed your disappointment and chart a path forward. So here’s how to do it.

What is the cycle of shame?

Before you can break the cycle of shame, you must first fully understand what it looks like.

Shame is defined as “an intensely painful feeling of being fundamentally flawed.” It’s a self-destructive behavior that makes you want to run and hide. It can manifest into anxiety, anger, secrecy, and, in extreme cases, suicide if you feel there’s no way out.

For example, a person experiencing money shame may be humiliated by how much credit card debt they have. They can’t stand how powerless they feel when they see their credit card statements, so they go on a shopping binge to make themselves feel better.

The next day, they feel ashamed at how much more debt they’ve racked up, so they continue to buy more things to temporarily wash away the pain. It’s a vicious cycle.

Guilt vs. shame: There’s a big difference

You shouldn’t confuse guilt with shame when it comes to money because they’re two totally different things.

Guilt makes you think you’ve made a mistake (e.g., “I made a bad decision with my money.” ). Shame makes you think you are the mistake (e.g., “I’m terrible with money.” ).

Guilt motivates you to learn from your mistakes and do better. Shame leads you to believe there’s no way out, so why start trying now?

How the cycle of shame harms your relationship with money

Money shame is a real problem in the U.S. No one is born knowing how to manage their money, yet we’re all expected to do it flawlessly from the start. If we show any signs of struggle, we beat ourselves up about it. We internalize the shame and convince ourselves that we’re destined to be bad with money forever.

If you’re not careful, this cycle of shame can lead to a downward spiral where you:

If you’ve experienced suicidal thoughts due to money shame, contact the National Suicide Prevention Hotline at 800-273-8255. Suicide is preventable, and there is a way out. Please remember that financial stress can be temporary and you can have the life you deserve!

5 Tips for breaking the shame cycle around money

So no matter how bad your situation is, you have the power to break free from the cycle of shame you’re experiencing around money. Here are five tips to help you heal:

1. Figure out why you’re experiencing money shame

The first step is all about getting to the root of the problem. Dig into your past and figure out where your money shame is coming from. Did you take out a loan without fully understanding the terms? Did you fall for a forex trading scam? Were you taught as a child that all debt is evil, and now you're riddled with shame for having it?

Once you’ve figured out the cause of your money shame, write it down on paper so you can visualize it and start the healing process. 

For example, you may write, “No one taught me about credit cards when I was young. When offers started flooding through the mail during college, I blindly racked up charges without fully understanding the interest behind it. I’ve been shaming myself for having so much credit card debt, but now I’m making a plan to move forward.”

You have the power to rewrite your money story!

2. Open up to your loved ones about your money situation

You’ve likely been keeping the source of your money shame a secret for years. You’ve bottled up the resentment you feel, too afraid to let anyone in.

The next step to breaking the shame cycle is to open up to someone you trust. Someone who won’t judge you and will accept your situation as it is. Share your story with this person, and talk openly about your struggles.

Not only can a loved one help hold you accountable as you break the cycle of shame, but they may even have advice if they’ve been in your shoes. In the case of credit card debt, for example, they may have tips on how to lower your interest rate or pay it off quicker.

3. Replace your negative thoughts and habits with positive ones

Money shame is often accompanied by destructive behaviors and thoughts that can be hard to escape. So one way to break free is by creating positive habits that counteract the negative ones.

For example, if you think you’re bad with money, make a list of mantras you can recite when you need a quick reminder of how awesome you are. You may say things like:

  • I control money, money doesn’t control me.
  • My finances don’t scare me because I have a plan.
  • I am worthy of a solid financial foundation.

Then, take small actions to back up these positive beliefs. Move $20 to your savings account each time you get paid. Pay an extra $50 on your credit card bill. Read one financial self-help book a month. Pretty soon, all these tiny actions will compound and melt your shame into pride.

4. Get professional help breaking the cycle of shame with money

If you’ve tried some of these tips already and still can’t break the shame cycle, consider hiring a therapist or financial coach. These professionals can help you identify the root cause of your shame, evaluate how your relationship with money affects your financial decisions, and make a plan for forging on.

5. Practice self-love and compassion regularly

Believe you have what it takes to break the cycle of shame. Also, practice self-love and never stop fighting the inner dialogue that tells you you’re not worthy. Research shows that self-belief is an important predictor of success. When you believe you have what it takes to reach your goals, it’s more likely to happen. And when adversity gets in your way, you’re more determined to overcome it.

Break the cycle of shame by starting with one small action

What one small action can you take today to break your cycle of shame around money? It doesn’t have to be anything extravagant. You can start small by:

Just choose one small thing you can do this week to change your financial situation. You’ve got this. We believe in you.

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