As a child, were you told that “money doesn’t grow on trees”? How about “money is the root of all evil”? Or maybe, as a teenager, you internalized the refrain, “mo’ money, mo’ problems.” Seemingly harmless phrases like these actually contribute to your current money story, and, for many of us, that’s not a good thing.
In fact, all of the information that you gathered since you were a child through adulthood contributes to making up your money mindset. Otherwise known as your money story. Not everyone’s story is negative, but many of us have internalized negative beliefs about money that, no matter how hard we work or save or invest, inhibit our financial lives.
That’s why it’s time to learn about yours, so you can change your journey and rewrite your financial future!
What does a money story mean?
Understanding your money story is fundamental to understanding why you make certain financial decisions. Once you know your story, you can change it and your relationship with money. So what is a money story? Your money story is your personal belief and narrative about money.
Money stories form during childhood from all of the influences surrounding you. Things like express words from your parents or caregivers, actions you observed in others, and feelings you picked up on (like a stressful home environment every payday) all contribute to your story.
Nobody chooses their money story – it starts during childhood. In fact, children can grasp basic money concepts by age 3! Even though you can’t choose your money story growing up, the good news is, you can change it.
Why is knowing your money story so important?
Your money story affects everything you do in life. Money is involved in decisions about how much mortgage you can take on, what kind of clothes you buy, what type of job you take, and basically every choice you make in life. That means your money story is involved in all of these things, too.
For example, if you grew up in a household where money was tight, and your parents stressed over there never being enough, you probably have a story rooted in scarcity. This might cause you to save instead of spend, which might sound like a good thing, but it isn’t always.
If you are too fearful of ever spending money, even when you have enough, you might miss out on opportunities and joy in life that money can buy.
Knowing your money story is the first key to changing your financial life. Once you know you have a scarcity mindset, for example, then you can work to change it. Rather than worrying there isn’t enough try changing your perspective and focus on abundance instead.
This new money story – one of abundance instead of lack – will open up new options. It will show you that you do have control over your finances and that there are ways to afford a house, get paid what you deserve, and more.
What is your money story?
Before you can change anything, you have to understand your money story. Remember, your story was formed throughout your childhood, so your childhood is where you should start.
Think back to when you were growing up and write down any key money memories from childhood. Did your parents often fight over money? Did your father spend lavishly but had to hide his purchases from your mother? Not all money memories are bad, but they all influence your story.
Next, write down all of the things you tell yourself about money. Do you find yourself repeating things like, “nobody in my family is rich,” “I’m not good with money,” or “wanting money is selfish”? These are all clues to your money story.
Lastly, write down your answers to these questions, which will prompt your internal beliefs about money:
- What did your parents teach you about money?
- What didn’t your parents teach you about money?
- Were there discussions about money in your household?
- What do you remember about how your parents spoke to each other about money?
- How did you feel when you spent money as a child? When your family spent money?
- Did you have more or less money than your peers?
Once you’ve compiled your list, you’ll have a good picture of what your money story is and you can then move on to rewriting that story.
Tangible steps to take to rewrite your money story
Now that you know your money story and where it came from, it’s time to rewrite it. Don’t let other people’s words, actions, and behaviors affect your money for the rest of your life. Instead, follow these steps to change your relationship with money and take charge of your financial future!
1. Forgive yourself for past mistakes
We all make mistakes, but some of us are harder on ourselves than others. Forgiving yourself for past financial mistakes, even if they are affecting you now (like taking on a too-large student loan burden or racking up credit card debt), is key to improving your finances going forward.
And now that you understand the concept of a money story and how little control over it you have since it was formed during your childhood, perhaps it will be easier to forgive yourself for past financial mistakes.
Only once you’ve forgiven yourself can you let go of the past and open yourself up to new ideas and a new future.
2. Review your values
When you give up your old money story, you will need to replace it with a new one. A good place to start is with your personal core values.
Whether you consciously know them or not, your personal core values are your core beliefs that guide all of your decisions. When you become attuned to your personal core values, you will be in a better position to decide what you truly want your money story to be.
Let’s say you have a value of security. This is something to consider when building your new story. You’ll want your story to incorporate the high value you place on security. So, perhaps, your story could be that you believe that you have enough money to support your family and provide them with all of the resources they need to thrive.
3. Educate yourself to gain money confidence
Rewriting your money story means throwing out the old beliefs you have about money. Maybe you believe that you have to work hard to get rich. Sure, working hard has its benefits, but it’s not the only way to get rich. Have you educated yourself about personal finance and investing yet?
If not, now is the time to do so. Take one of Clever Girl Finance’s free courses on investing or pick up a copy of “Learn How Investing Works: Grow Your Money.” After educating yourself and gaining confidence, you’ll be in a better position to rewrite your money story.
You’ll go from believing that you have to work yourself to death to get rich to realizing that money flows to you with ease (so long as you understand the stock market!).
4. Commit to change
Lastly, rewriting your money story takes a commitment to change. You have to change your mindset and your actions in order to toss out your old beliefs and replace them with something new. Put your new money story into practice by thinking about it every time you make a decision or purchase.
Are you coming at this from the old viewpoint (for example, that money is there to be spent)? Or are you coming at it from your new viewpoint (that money is there to be spent as needed, but also to be saved)? Repeat your new affirmations every morning.
Write them down on post-it notes that you scatter throughout your house and car. Whatever it takes and whatever works for you, just make sure you frequently repeat your new money story to yourself. Be sure to check out our list of best books about money mindset.
You’re ready for a new money story
Identifying and then rewriting your money story is one of the most powerful changes you can make to your financial life. Once you uncover the deep-rooted beliefs you have about money, you’ll probably discover that there are many of them that you don’t want to hold on to.
Outside influences formed your story. But you can set those beliefs free and uncover a new money story – one that’s aligned with who you are today and where you want to go in the future.