By Candice Davie
Do you love splurging every chance you get? Or are you a penny pincher? Maybe you are a little bit of both. Chances are that your relationship with money stems from childhood experiences and influences. Your thoughts surrounding your finances have a huge impact on all your financial decisions so it’s worth getting to the root of how those thoughts came about especially if they have led to money habits that you’re not so proud of.
Here are three financial childhood experiences that could be affecting your pockets today:
- What was the financial status in your household growing up?
The way your parents, guardians, or others around you handled money is a big influence on how you handle yours. If you grew up in a household where money was tight, you might take on the belief that you may never make past a certain amount of money and be fearful of spending much even if you are able to afford it. Some go to the opposite extreme of what they saw, and once making a certain amount they spend frivolously.
- What were the conversations surrounding money?
We learn a lot from our parents’ attitudes towards money. Think about what conversations around finances looked like in your house. Were they from a place of fear or hope? Did they include talks about how to create a better financial outlook?
“Is there a sense of security around money, or does the subject provoke anxiety? People wo experience money worries as kids are more likely to carry forward that sense of scarcity and insecurity”, say psychologist Frank Murtha, co-author of “Market Psych: How to Manage Fear and Build Your Investor Identity.”
- What was the state of the economy during your childhood?
If you grew up during the Great Depression or market crash of 2008, chances are your current financial decisions were affected by witnessing all the events such as being extremely against investing in the stock market.
There’s no doubt that our experiences growing up are very powerful but, understanding that if the decisions you have made as a result are not serving you well you can choose something different. Doing your own research and leading with a clear intention for your life are the first steps to achieving your financial dreams.
How do you feel your childhood affected your finances? What changes have you made since then?