One thing I hate about most money advice is that it tells you what you should be doing, as if you didn’t already know. Most of us are aware that we need to spend less, save more, and plan better (thanks for the reminder). To me, the real question is how you actually get yourself to do those things, and what’s making it so hard.
Enter “money scripts,” also known as “money stories,” a concept that has been tossed around by financial therapists for years and more recently edged into mainstream financial planning. Loosely defined, money scripts are “what you learned about money from your upbringing, how you responded or rebelled, and what your current money dynamics and patterns are,” says Bari Tessler, a financial therapist and author of The Art of Money.
To be clear, teasing out your money script won’t solve your financial problems, especially ones that are out of your control (which, at this particular moment, may be a lot of them!). But the process of self-examination will help you notice your behaviors, look at what’s behind them, and — theoretically — recognize and change the ones that aren’t working. As Tessler puts it: “Awareness leads to understanding, and that allows us to dismantle and replace the habits we don’t like.”
If that all sounds a little woo-woo and simplistic, I get it. You can’t sit around blaming your financial woes on your parents or vision-boarding your way to a higher paycheck. But you also shouldn’t ignore the abundance of research showing that certain early life experiences do correlate with destructive financial choices as an adult, and how they can be overcome with specific therapeutic techniques. In one British study, subjects who’d been raised in households that were secretive about spending were more likely to have compulsive money habits, like hoarding, when they grew up. Another study found that childhood trauma (financial or otherwise) often had a deleterious effect on subjects’ financial decision-making later in life.
On the upside, psychologists have also found that cognitive-behavioral therapy (or CBT) can help people overcome negative financial habits ranging from the very serious (like compulsive overspending) to the more garden-variety (avoiding bills). And the techniques used in CBT sound a lot like what money stories are all about: exploring the underpinnings of your negative patterns, interrupting them with attention and practice, and then replacing them with new and better coping mechanisms. In a nutshell, putting some elbow grease into figuring out your money story will probably help you improve your finances at least a little, if not a lot.
Big picture, that sounds good, but how does it work at a concrete level? Eugenié George, a certified financial educator and the author of Our Money Stories, likes to approach the money-story process over a six-week period. “The first two weeks is all about your emotions,” she says. “Do a deep dive into your memories about money — how it’s shaped your life, what frustrates you, what stresses you out, and what you want to change. Do stream-of-consciousness journaling. Cry it out. Talk to a therapist if you need more help.” (Tessler has a list of journaling prompts that may be helpful during this phase.)
In the second two weeks, you’ll get to the actual numbers. “It’s all well and good to understand your feelings about your money, but if you can’t ground them in your reality, they won’t amount to much,” says George. She recommends printing out your bank statements and going over each line, as tedious as it sounds. “Look at what you’re spending on and see if it matches up with what you value,” she says. “This is usually when you’re like, Oh, I spend $150 at Rite Aid regularly and I don’t even know why. But I wish I had that money to spend on things I actually want.” It’s also the part where you have to be honest with yourself. Perhaps you come to the painful realization that, say, your compulsive lying about money is rooted in your dad’s multiple bankruptcies; the bad news is that you’re still a compulsive liar, but the good news is that you’re one step closer to confronting it.
The last phase is about making a larger plan to organize your money in the future, now that you know what you want to change. This involves looking comprehensively at what you own, what you owe, what your credit score is. You’ll also establish a regular practice — maybe weekly, or twice a month — of checking all your numbers to evaluate your progress. Both Tessler and George call these “money dates,” and advise gussying them up to make them as appealing as possible — light candles, put on nice music, etc. (I usually do this on Friday afternoons when I’m sick of doing actual work, but it’s not the weekend just yet. It’s amazing how a boring task gets more appealing when you use it to procrastinate something else.)
Meanwhile, seek out a sort of money mentor (George calls them “financial BFFs”) who will understand your money story and keep you honest and accountable in your efforts to move forward. Depending on what kind of help you need, this could be an actual financial adviser, a financial therapist, or an accountant; it could also just be a friend who’s good with money and will give you smart advice.
Then, repeat. “Understanding your money story, and rewriting the things you want to change, is a lifelong process of gathering information, applying it to the practical aspects of money, and then gathering more information,” says Tessler. She recommends that you make journaling part of your regular money dates, and that you also integrate physical check-ins with yourself when you’re making daily financial decisions (another common CBT technique). “Most people aren’t even conscious of the stories they’re telling themselves about money, but if you take the time to pause before you buy something, and breathe, and see how you’re feeling, it gives you more insight into what’s driving your choice, and whether it’s being driven by a narrative that you no longer want to follow,” she explains.
Finally, let yourself off the hook for your past and inevitable future screwups. Understanding your money story is all about learning from your mistakes (and your parents’ mistakes, and society’s mistakes, and so on), and that’s much easier if you don’t agonize over them. “You unravel a pattern by watching it, bringing attention to it, and then noticing the moment before you fall into the hole,” says Tessler. “You may still fall in, but the next time you’re back there, you’ve learned something new about it. It doesn’t feel good, but the more compassion we have for ourselves in that process, the easier it will be to go through it.”