How to get over family money problems in childhood causing issues as an adult

How our parents’ money issues affect us growing up

When we are children, sometimes we face experiences that we are not yet mature enough to handle. We don't have the power, skills or resources to resolve the issue and we may not have the perspective to understand that it's not our responsibility. This can be frightening, confusing, upsetting and frustrating. As children, we cope however we can with the issue and the feelings that come with it.

For example, we might:

• distract ourselves and others with jokes and games 

• hide and wait for it to be over

• become aggressive and try to force others to do what we want

• be extra nice and accommodating, so authorities will approve of us and protect us

• or become fixated on trying to anticipate every possible problem and control what we can control perfectly, so there are no nasty surprises

These are all understandable strategies for a child to take when faced with an adult-sized problem.

Unfortunately, once we have learned a coping strategy, it can become our automatic response for similar situations, even in adulthood. In essence, when we are faced with an issue that reminds us of being young, overwhelmed and helpless, it's like we become that child again without even realising it! We respond like we did when we were little, before our adult minds ever get a chance to come up with a better solution.

Because these childlike responses rarely work out well for us as adults, we can end up feeling even more powerless and upset and even less capable of dealing with that aspect of life. The most challenging part is that it all happens so quickly, we don't even recognise that this is what's happening!

When the issue in question involves money, this can cause a lot of trouble. We need a calm, adult mindset when dealing with questions of money, not an overwhelmed childlike one.

Examples

If you heard your parents fighting because one of them went out with friends when the other one thought they couldn’t afford it, you might try not to spend anything on yourself at all, so no one can criticise you for it. You could end up thrifty, but joyless.

Or if your dad lost his savings to a scammer, you might just spend everything you get, because deep down you don’t trust that saving could pay off. Of course, this leaves you unprepared for emergencies and at risk of problem debt.

Or if your aunts and uncles were richer than your mum and rubbed her nose in it, you might become driven by money and the status it can buy. You could become wealthy but end up burned out and doing work you hate.

Thankfully there is a way forward. 

The solution

If you can imagine yourself as you were when you learned this lesson about money, you can connect to the childlike part of yourself that keeps rushing to the rescue with a strategy that no longer works. Once you can do that, you can gently persuade them to let your adult self take over and try another way.

This takes compassion and an understanding that your younger self isn’t trying to mess things up. Your younger self isn’t stupid or selfish or bad. They’re just doing what they can with the skills and understanding you had when you were that age. A good start is to let them know you are grateful to them for trying to help and you know the did their best. This should help you to feel more calm and able to think more clearly.

Then you can tell your child self that because you are now a grown up, you have different, grown up ways to solve the issue. The child part of you doesn’t have to be responsible for trying to fix a problem they’re too young to handle any more. You’ve got this!

I can help you to learn better, more grown up strategies for managing your money. To find out more, book a free, no-strings call and let’s discuss what financial coaching can do for you!

"Everyone else can manage their money, why can't I?" - the big myth at the root of financial shame

At some point almost all of my clients say something like this. I hear it in almost every enquiry call. “It just seems like everyone else knows what to do and they’re all doing fine and I never have.”

It’s a huge irony that so many people feel alone when they get confused, anxious and stuck trying to decide what to do with their money. “I’m the only one, everyone else can do this just fine” is story that so many people tell themselves, but it is just a story. It’s not true. Even though it’s just a story, the effects are real. Believing you’re the only one who’s not capable of handling money causes huge amounts of unnecessary shame and anxiety, which blocks clear thinking, making you more stuck.

In May 2024, I was interviewed by financial planner, Chris Daems about a whole array of topics to do with making financial choices and how we deal with our feelings about money during big life changes. During this interview, Chris asked me about the phenomenon of people believing that “everyone else is better with money than me” or “everyone else is good with money, why I am so bad?”

Recently, I’ve found myself sharing this section of the interview over and again, so I thought I’d highlight it here, where you lovely people can find it. In the video I give the clear, simple, reasons why this story is just a big old myth. I also offer some other perspectives to replace the myth.

Video interview by Chris Daems with Martha Lawton about recognising that not everyone knows what they are doing with money and strategies for challenging this unhelpful limiting belief.

I hope you find this video useful. If you know someone else who needs to see it, please share it with them. If this discussion resonates with you and you want to work on changing these feelings and getting unstuck about your money, click the button to set up a free, no-strings chat about how financial coaching can help.

Using money to make an impression

It's pretty normal to consider how other people will respond to our choices. We are social creatures and making a good impression is useful in many situations. There are times when it's very valuable to stand out in a crowd or fit in with a group. It can influence others to pay attention to us or support us when they might not otherwise do so. Money, especially our spending choices, can be a part of that.

Sometimes using money in this way can become overly important to us. This can even happen to people who wouldn’t normally think of themselves as “people pleasers”. When the good opinion of others is the main driver for our decisions, especially those involving money, we can end up living inauthentically or using money in ways that doesn't support our long term goals.

The most obvious example of this is when a person goes into debt buying expensive designer or luxury items to signal to others a wealth they don't actually possess. Overspending on gifts in order to appear generous or on socialising at trendy bars and clubs in order to seem like part of a fashionable in-crowd are other variations of this.

There are also more subtle ways this tendency can show up. For example, it can appear in reverse. Imagine someone whose social circle disapproves of, or is suspicious of, people with wealth and power. A member of this group might feel compelled to deny themselves anything that might be seen as a status symbol, even if they would enjoy it or it would make their life better or easier. Or they might not to make any overt moves to improve their career and earn more or manage their finances effectively, leaving them worse off and possibly stuck in unfulfilling work.

The interesting thing about this tendency is that it can occur even when there’s no active pressure from the people we’re trying to impress. The compulsion towards certain choices can come entirely from within. We form beliefs about what others want from us and anticipate getting a negative reaction if we don’t meet their expectations. The trouble is that all of this is a story we’re telling ourselves. It may or may not be true. Sometimes the people we are trying to please couldn’t care less what we do or may want something different from us than we’ve imagined. It’s worth looking for evidence of people’s true expectations and opinions. Sometimes it’s simplest just to ask!

And if a person or group really does expect you to make financial choices that don’t align with your values or goals, it’s worth considering whether it’s really worth going along with their wishes. Are you really getting what you want from this person or group’s approval?

Getting a balance between using money in ways that support your relationships and also your individual life goals is key to financial wellbeing.

If you are facing a dilemma around money in relationships, coaching can help.

Self-love, self-care, self-abandonment (and money)

People in failing relationships often become uncaring or neglectful. "If you can't be bothered," they say to themselves "Nor can I!" One of the biggest revelation for me in therapy was my failing relationship with myself. I was treating myself like I wanted to break up!

I took my good points for granted instead of celebrating them. I didn't think creatively about what could bring me joy. I was neglectful of my every day needs: my home was a mess; I didn't take good care of my health - my sleep hygiene was poor, I drank too much and I barely exercised.

As my therapist put it I had "abandoned myself". It did not feel good. And, of course, the worst bit of treating yourself like you want to break up is that you can't do so and live. You only become more and more miserable and trapped with time.

Thankfully there was an answer. A previously uncaring and neglectful partner who becomes considerate and fun can re-ignite the spark and make you fall in love again.

Similarly a person who has abandoned themselves who begins to show themselves care and love falls back in love with themselves.

In essence, even though each of us is only one person, we act as if there is an element of reciprocity in how we treat ourselves.

If we aren't loving and caring to ourselves we sulk and refuse ourselves future love and care. We act as if there is someone else in the equation who should do better, but it's just us!

Because we are angry and disgusted with ourselves for not looking after our wellbeing, we refuse to do the things that would improve our wellbeing as a kind of self-punishment.

The fix is to see the cycle for what it is and realise no one else can break it. we have to start showing ourselves the love and care we crave.

We have to treat ourselves as worthy of love and care in order to believe it, it doesn't work the other way around because the physical evidence is against us.

This is true both in the sensible ways (washing the dishes, getting fresh air, and going to bed instead of doomscrolling) and in the fun ways (taking a day trip, dancing like no one is watching, buying a small indulgence - like fresh flowers or fancy socks).

We have to make a commitment to ourselves. After all we're in this relationship for life. If we can't be happy in it, we can't be happy.

I have said before that we use money to treat ourselves the way we believe we deserve to be treated. 

That means that if we don't believe we deserve comfort and peace of mind, we will mis-manage our money so there's never enough and we are constantly stressed. 

The internal dialogue that says "If you can't be bothered, nor can I!" can get very strong around money, even for people who take excellent care of themselves in other ways.

That's why I'm inviting you to make 2023 the year you make a real commitment to yourself.

This is the year to show yourself some genuine consideration and prove to yourself that you are deserving of your own love.

The changes I've made since therapy weren't easy. I've had times of backsliding. The voice of self-resentment is loud at the beginning. One day of not wiping the cooker down properly or taking the lift instead of the stairs and it was easy to feel both that I had failed and that I was unworthy of a clean home and a healthy body. And if I wasn't worthy of it, why make the effort?

Because of this I know that structures and support to get started and stay motivated are vital, especially in the early stages. My therapist would ask about my self-care every week.

So, to help you not only get started but stay committed to yourself and to using money to treat yourself like you are worthy of love and care, I have developed a new programme that starts at the end of this month (January 2023). I'm very excited to share it with you.

My Year of Action is a small group coaching programme that I have been planning and testing for literally years. Now it's ready to launch starting this January 31st. I'm very excited!

(For those of you who have completed My Money Canvas, the programme maps onto the areas on the Canvas, so you can prioritise the areas you identified as needing the most attention. For those who haven’t sign up to my newsletter to get the free download, there’s a form on my home page.)

Because it's  the first time I'm running My Year of Action, I'm offering it at a heavily discounted rate, so it's works out at just £39 a month!

Given that one of my testers cut her costs by £600 a year in the first month, I reckon this is a great deal. You can show yourself a lot of love with £600.

To find out more and book your place, just click the button.

I can't wait to see you there!

What happens if you strip off your mental wallpaper?

We’re having the house re-wired and re-plastered. We’ve stripped the wallpaper, lifted the carpets and found all the hidden stuff we couldn’t see when we bought the place. It was nerve-wracking, but also brilliant. Now we know what we’re dealing with. Guess what? This is a facing the truth about yourself metaphor.

We could have stayed living in the house as it was when we moved in. We could be living with ugly, textured 1980s wallpaper and a drab, grey fitted carpet throughout. We could have decided that we didn’t want to know if there were issues with the plaster or woodworm in the floorboards. We could have made do with the old radiators, even if they were full of gunk and didn’t get hot all the way down. We could have decided that whatever the strange plasterboard alcove was hiding could stay there.

We didn’t.

We sucked it up, called in the professionals, and pulled away the superficial to find what was really underneath.

What was really underneath?

A building site. The wooden floor is dusty. The walls are painted in an art deco style with a slightly eccentric mix of yellow ochre and khaki green with chestnut brown accents. There are wires hanging from uncovered electric sockets. A capped water pipe dangles from one wall. There are dust sheets bundled up. A broom and a ladder propped against a wall. The electric pendant light dangles from a hole in the ceiling.

Well, there was lots of gunk in the central heating system but new radiators and a flush through sorted that out. There was a really weird paint job that we suspect might date back to the 1930s when the house was built. There was some places where the plaster is pulling off the walls and will need to be cut away and replaced completely. There was a set of electrics so dodgy we are now re-wiring altogether. There were floorboards in surprisingly good condition (hooray!) just waiting for sanding and polishing. There was an interesting arch that’s part of the chimney system.

If you go through struggles that you are powerless to prevent, (difficulties in childhood, natural disasters, serious illness, adult trauma and abuse etc) you will develop the mental equivalent of ugly wallpaper, cheap carpet and strange pointless alcoves as a way to feel or appear normal until you feel safe enough to repair the effects of your struggles.

The trouble is, your brain puts up the wallpaper without asking you first. It carpets the floor before you have a chance to object to the colour. It sticks an alcove over things you actually quite like, so you forget they were ever there. In fact, you’re so busy surviving, you don’t even notice that your mental home has changed. By the time you are in a position to do anything about it all, ugly wallpaper, drab carpet and strange alcove seem normal. This is just how you are.

Many of the struggles I wrote about above often involve a financial element. That can lead to the sense of powerlessness and pain connected to the event transferring to your feelings about money. There are also times when money is right at the heart of a painful experience, like losing your job or finding your partner has secret debts.

If you have stopped looking at your finances or told yourself you’re “bad with money” or “not a money person” that’s ugly wallpaper.

Here’s the thing. Until you look underneath, you won’t know where the plaster is pulling away from the wall, so you won’t know what needs repair. You’ll be living in the cold needlessly because you would rather avoid dealing with it than get warm.

More than that, you also won’t know about that arch that could become a cool feature if you let it out. You won’t be able to polish up and enjoy your good solid floorboards.

Personal finance experts often tell you to face facts so you can fix where you’re failing. I’m telling you to face facts so you can discover and celebrate where you’re already better than you knew.

Yes, and fix the bits that need fixing, because you deserve better than cracking plaster and cold radiators.

Are you ready to lift the grey carpet over your money mind?

Try My Money Canvas. It’s a quick, free, simple tool to help you uncover your financial strengths and weaknesses with no maths and no paperwork required.

The cure for being "bad with money"

In spite everything I’ve said in previous blogs, do you still think “I am bad with money”? Does the thought of ever getting on top of your finances seem impossible? Is there some part of your identity, deep within, that rejects the idea that you could ever be good with money? Does even trying make you feel tense and sweaty? Is your stomach doing an awkward, twitchy, little dance just reading this?

It’s ok.

I’ve got you.

Imagine a life in which the end of the month doesn’t feel too different from the beginning. Imagine planning to treat someone you love and being able to go to town without going into debt. Imagine knowing if one of life’s crises crops up, you have the money to cope. Imagine musing on the future you want once your ready to stop working, confident that you’ll be in a position to enjoy it.

What if you could be ok with money? What if you could be fine with money? What if you could be good enough with money?

The good with money/bad with money false binary that I’ve ranted against leaves no room for a more casually comfortable relationship with money. In reality, this is what a lot of people would prefer. Many people would like to be confident they’re doing alright with their finances, but aren’t primarily driven by money.

Does the idea of being good enough with money sounds great, but also a long way from your current situation? That’s ok. You can get there. The key is to start really, really small.

Imagine the types of actions you would take as a person who is good enough with money. Some suggestions:

• shop around for deals and cancel unwanted subscriptions, so you don’t waste money on shopping;

• learn the meaning of financial jargon and basic economics, so you feel confident in your choices;

• save and invest automatically on pay day, so you don’t rely on willpower to make good intentions happen;

• pay off borrowed money as soon as possible without incurring extra charges, so you pay as little interest as possible;

• negotiate for more pay and lower costs, so you get a great deal;

• keep financial paperwork orderly, so you can get your hands on the information you need when you need it;

• learn what different financial professionals do and how to choose the right one for your needs, so you can tap into the expertise we all need from time to time.

Choose one of these groups of actions. Now choose a single, small, simple action that fits within this group.

Smaller than that. Nope. Still too big. Think smaller. Think tiny.

Some suggestions for tiny actions:

• Search for reviews for one product you are considering buying and bookmark the review to read later, if you can’t read it now;

• Find out where you can see the list of subscriptions in your Apple, Google or other mobile payments account;

• Learn the meaning of one piece of financial jargon - this is a good list - start with words you’ve seen before;

• Find out how to set up a regular automated payment into savings;

• Find out if you can overpay any money you’ve borrowed without being charged extra;

• Make a list of your achievements at work;

• Open one envelope - you don’t have to read what’s inside.

We become confident, not because we’re confident people or by telling ourselves to “be confident”, but by doing what we want to become confident we can do.

There is no such thing as being “bad with money”, but if there were, and if you were, the “cure” would be these tiny actions, one after another, day by day, gradually adding up to better more money in the bank. Do a few tiny actions every week and you’ll be well on your way to being good enough with money.

P.S.

I used to be a financial adviser. It was my job to have a deep understanding of financial products currently on the market and how these could meet people’s needs. I would listen to people’s individual stories and ask questions about those needs, then recommend the products I thought would suit them the best.

As a money coach, I help people understand and improve their psychological relationship with money, so they can be happier that their financial choices are supporting them to build the life they want. There! You’ve completed an action from the last group already! In fact you’ve done it twice. Well done. Go have a cuppa and listen to a song you like.

Do another tiny action tomorrow.

You’ve got this.

What will you be doing 3 months after you retire?

For most of our lives, our time is filled with obligations, but what do we do when we’re no longer obliged to do anything much? For many of us, working for money occupies our time and energy for most of our adult lives. We may be in different types of work. We may be employed or self-employed. We may care about career advancement or not. We may enjoy our work and find it inspiring and rewarding, or resent it and begrudge every minute, or simply consider it a neutral necessity. What ever our feelings about working, while we’re in the midst of it we rarely stop to think what happens next? What will I do after this?

I think this may be one reason why so many people don’t save enough for retirement*. They simply can’t picture themselves without their work. That’s not to say people don’t want to stop working. If you ask people what they’d do if they won the lottery jackpot “quit my job” or “never work again” come high up the list, but that’s usually about getting away from stress and frustration, not moving towards a more desirable life.

To put it another way, many people can imagine vividly what it would feel like to tell Cherie that she can staple her own damn expense reports, Derek that his reheated mackerel is a form of air pollution, and their line manager to get ****ed because they are outta here, suckers!

But what happens next is a mystery.

Financial independence doesn’t require a lottery win. Regular, diversified, tax efficient investments plus time will get you there. Even if you don’t make plans to fund your life once once your stop working, at some point you probably will. It’s worth taking the time to understand what you want your life beyond work to be like.

Once you’ve successfully built wealth throughout your working life, how will you spend it?

The interesting thing is that many people can name the things they will do in the first few weeks of freedom, because that’s really just like planning an extended holiday. The bigger question is how will you spend your day-to-day? What happens next? And what about after that?

This is a deeply personal question. Everyone has a different answers. Some may want to take frequent holidays. Some will spend time learning, volunteering, pursuing hobbies or creative projects. Some want to spend more time with family. Some want to focus on their wellbeing and staying active.

Most of us only have quite vague answers to this question and that’s an issue on two fronts.

Firstly, because vague goals are not motivating. Why would you save and invest for a life that doesn’t exist? Having a clear vision of your life beyond work helps you understand how much money it will take your to get there. It also makes that goal more desirable. Once I can really imagine my future, every pound I put into investments is no longer “for my pension”, it’s for my “learning historically accurate calligraphy and bookbinding” fund. Or my “weekly one-to-one yoga class, sauna and mani-pedi” fund. Or my “hiking the world, from the South Downs to the Appalachians” fund. Or whatever floats your boat. (A catamaran fund?)

It’s more obviously worth being frugal now in order to invest towards these dreams than the generic investment goal “for retirement”.

Secondly, you may be able to put plenty aside for your life beyond work, but if you don’t know what that looks like, you could get there and find you’re feeling kind of flat and nonplussed. It’s common to struggle with the transition out of work, and the change in identity that comes with it. Thinking about what you want your life to be like can make that transition smoother. It’s psychologically easier to let go of a past identity if you have a future to reach towards.

For me, I’d like to have a studio space and make all sorts of art without caring if it’s any good, at least three holidays every year, and the option to pay for massage and physiotherapy immediately if any part of me starts feeling creaky.

What would your ideal life beyond work look like?

You can learn more about financial independence and investing to make work optional on my podcast, Squanderlust.

*Or protect against serious illness and injury for that matter, but that’s a whole other topic.

Learning to let go (a trap for frugal people)

One of the most annoying psychological traps out there is a tendency to double down on decisions that aren’t working out. It feels bad in the moment, it feels worse in retrospect, and it drives our friends nuts.

Regina George in the film Mean Girls delivers the iconic line “Stop trying to make ‘fetch’ happen.”

The desire to “make it work” because we’ve already put in so much has us wasting our time energy and goodwill on people, jobs and other organisations that do not deserve it and throwing good money after bad.

Ever read a story about a six-month-marriage where one partner only went ahead because the big expensive wedding was all arranged? Cringe! Yet it happens. Why? Because “We’ve come so far we can’t back out now.”

Yes, yes you can!

This phenomenon is the sunk cost fallacy. A cost you can never get back is a sunk cost (all time wasted is a sunk cost). The sunk cost fallacy is when we make the sunk costs a factor in our future decisions, instead of purely looking at the future costs and benefits. The sunk cost is irrelevant, what’s gone is gone.

Some reasons why we end up falling for the sunk cost fallacy:

• Pride - we try to style it out - “No, I love my (expensive but impractical) marble kitchen work surface! Sorry, please don’t put the turmeric down there… or there…”;

• A sense of responsibility - “Others have put their trust in me, they will feel bad if we don’t finish what we started”;

• We look at what we’re getting compared to what we paid, when we should just ask “what is this worth to me now?” This happens a lot in investing, people resist selling underperforming shares because they don’t like having made a lost compared to the purchase price.

• Over-optimism bias - “We can make this work!”

• Hatred of waste - to cut our losses is to admit we have made a wasteful decision.

If you’re a frugal type, that last one is the killer. It’s easy to keep doing something inconvenient, boring, tiresome etc because you don’t want to have wasted your money and efforts so far. Realising that you’re better off admitting to the waste and finding ways to avoid it in future is a huge relief but it can be an emotional struggle to get there.

One way to get around the sunk cost fallacy is to imagine someone else had paid the cost. We can ask ourselves, “What would I say to a friend who was in this position?” (Honestly, this is in the top three clarifying questions of all time.)

I’m deeply grateful to my late great aunt Sonia (great as in “fantastic” as well as in “my mother’s aunt”). When my sister and I were in our early teens she took us out to a West End play. We stood up at the interval and she turned to us. “Well, that was boring,” she said, “Let’s go for dinner.”

So we did.

We didn’t stay because “otherwise we’d waste the cost of the tickets” that money was already wasted. We left because staying would also waste the rest of the evening.

Now I always walk out of boring entertainments, and I always raise a mental glass to Auntie Sonia as I do. I encourage you to do the same.

We also did an episode of Squanderlust on the sunk cost fallacy.

No regrets! Using cognitive bias to achieve your goals

One of the most famous ways human beings are fundamentally irrational is our reaction to the possibility of regretting a decision. We really hate the idea that we might have future regrets. So much so that shops only have to put up a “sale” sign or mark something “limited edition” and we rush to buy in case the items we want become unavailable. Never mind that these items are often extremely generic and easily found elsewhere, or soon to be out of fashion and abandoned. Yes, I am speaking from experience.

So, regret aversion, as this phenomenon is called, has a bad name in the personal finance community. We’re encouraged to step away from the sale goods and give ourselves 24 hours to reconsider whether there’ll really never be another reasonably priced plain white t-shirt or if we’d actually find life meaningless without an avocado slicer like the one that influencer uses. (What even happened to avocados? Are they still a thing? I’m too old to know.)

I think, however, there are ways to make regret aversion work for you. Don’t get me wrong, it’s possible to make many silly choices from trying to avoid the possibility of regret. It’s a major cause of procrastination as we try to reconcile mutually exclusive options. Done right though, regret aversion can be harnessed to help us get motivated in the face of fear, self-doubt, boredom, frustration and plain old slog.

I have an image on the desktop of my computer that says “Turn ‘I could have’ into ‘I did’”. It’s there to remind me that I don’t want to look back on my life with regret. I don’t want to say “I had these gifts and opportunities and I didn’t use them”.

You can use this method for all sorts of goals including financial ones. Tell yourself “It might suck giving up my time to budget and meal plan, but if I can’t afford to spoil my partner on our anniversary, that’s going to suck even more”. Or perhaps, “I might feel uncomfortable negotiating my salary, but I’ll regret feeling I could have earned enough to save a deposit for my own home”. Or even, “It may feel awkward to ask the adviser to explain my pension to me yet again, but I don’t want to get to retirement and find I’ll be living on beans on toast instead of ”.

This is why it’s important to be really clear about your goals. The more you can visualise what you’re working towards, the more you can use the potential regret of not getting it to motivate you.

Exercise:

Imagine one of your personal goals very clearly, something you think you could do, with a bit of effort. Go on. I’ll wait.

Now picture the regret you would feel if you didn’t do everything you could to achieve it.

It feels horrible right? So, what can you do to make sure you never feel that way? What steps can you take towards that goal?

Comment below, what do you not want to regret?

Therapy is an investment in yourself (and it can produce a financial return)

Anyone who listens to my podcast, or knows me personally, knows that I’m very open about having had therapy for a few years in the early 2010s. It was, no kidding, one of the best decisions I’ve ever made. I say this even though a back-of-the-envelope calculation puts the cost (for several years of weekly private therapy one-on-one) at around £9,700.

(I’m going to go through why I think this for the benefit of readers who suspect therapy could help them and have enough money if they prioritised differently, but are choosing not to start therapy “because it’s expensive”. If you are on a low income or your other essential costs eat up so much of your budget that you genuinely can’t make space for therapy, and you know you need it, please scroll to the bottom of the post where I’ve put links to some low cost and free resources.)

When I first worked out what I’d spent on therapy, some years after I’d stopped seeing my therapist, I was a little shocked. I’d been on a pretty good salary while I was in therapy, so it hadn’t been too much of a stretch to cover the cost, but I hadn’t saved much outside of my workplace pension. I wondered if part of the reason was that I had put so much money into my mental health.

I messaged my sister and said “I don’t regret it, but wow, look at what therapy cost me!”

She replied with typical little sister directness “If you hadn’t had the therapy you would have spent it all on booze. (shrug emoji)”

And you know what, she’s right. Because before therapy I was in a pretty bad place and my spending reflected that. I was struggling with a whole bunch of difficult feelings and unprocessed mental STUFF (from early childhood losses through being assaulted in my twenties to a deeply toxic relationship and messy break-up) and I didn’t know how to respond to all those thoughts and feelings in healthy ways.

So what was I doing?

• Drinking too much. Not whisky-on-the-cornflakes drinking too much, just more and more often than was wise.

• Eating too much. Not exactly binges, but not exactly not binges either. I’d have a tub of Häagen-Dazs on the sofa once a week. Or a big bag of Kettle Chips with my bottle of wine. By myself. In my flat. On a Thursday.

• Shopping too much. Not to the point of getting into debt, but too much for saving and building a solid financial future.

I wasn’t taking good care of myself in other ways too. My home was frequently messy to the point where I was embarrassed to have visitors, I wasn’t exercising much, my sleep patterns were off, I’d get hooked on Skinner box-type casual video games and play them for hours. My inner critic had free rein to berate me as and when they felt like it. I was bad at making time for friends and lonely by myself.

When you look at this list of unwholesome behaviours, they fall broadly into two types. I was either neglecting myself (not exercising, not sleeping well, not keeping my home nice) or I was trying to numb difficult feelings with pleasures and taking it to excess (food, drink, games and shopping).

Since this is a money blog, let’s talk about the role shopping specifically played in this. How does shopping help numb difficult feelings?

If you’re feeling out of control, shopping gives a sense of control. When the world seems unpredictable and dangerous and your mind is a whirlwind of negativity, shopping feels like a simple, consistent ritual to hold onto. I choose what I want and, if I can pay for it, I am given it. Done.

If you lack self-respect, shopping is a way to buy respectful treatment under the convention that the customer is always right. I understand this is more complicated for LGBTQ+ people, disabled people and people of colour, especially those with darker skin, but in general, the principles of good customer service mean that sales assistants should be friendly and considerate of your needs. And you might not be getting that from anyone else, including yourself.

If you feel you there’s something wrong with you, shops offer infinite possible solutions. Maybe this personal organiser will make me feel like a real professional. Maybe this sketch book will rekindle my childhood love of drawing. Maybe this underwear will make me feel cute enough to want to go meet someone new. Of course, if the feeling comes from a lingering belief that your narcissistic parent/childhood bullies/abusive ex were right, no amount of fancy pants will fix it.

Our hunter-gatherer brains start releasing dopamine when we start shopping. Dopamine is a neurotransmitter that makes the search for pleasure enjoyable. It makes the actual process of seeking out a purchase feel at least as good as getting your hands on your new item. If you’re feeling miserable and unmotivated, this feeling might be quite rare in your life. Another reason why shopping can temporarily pull you out of that low place and seem so compelling.

Ultimately though, shopping is not a solution to your problems. The underlying pain and mental mess is still there and then there’s the shame of having overspent, when you know you should be able to save.

You can numb your feelings all you like, but you carry your mental baggage until you unpack it. I may have spent £9,700 on therapy, but I’d spent far more on treat foods, booze and unnecessary purchases. If I consider the opportunity cost of not having saved or invested the money I overspent, I’m looking at an extra £140,000 into my retirement fund, minimum. Ouch!

I don’t blame my younger self. I was overwhelmed and didn’t have better ways to cope. I was doing the best I could, but the best I could do was still making things worse until I spoke to a therapist and started working on the root causes of the issues.

What’s more, the calculation above is just based on the few year in the run up to deciding I needed to get help and finally deal with my issues properly. If I hadn’t had therapy and had just kept spending as I was, that potential investment figure would have been closer to half a million! What’s more, my mental health didn’t do my career any good either, so there would have been losses there too. £9,700 is nothing on that.

Therapy worked for me. I feel better about myself. I’m clearer-headed and make better choices. I live a very wholesome life. I exercise, I meditate, I enjoy my Häagen-Dazs, wine and Kettle Chips in moderation. My house is reasonably clean and tidy. I get to bed at a decent hour and mostly sleep well. I only shop when I have a clear idea what I need.

What I’m trying to say is, if cost is what’s putting you off getting help, but you have money for treats, shopping and socialising, then I’m taking this excuse away from you. The financial benefits of getting your mental health in better shape are clear cut, I’m afraid.

I’m lucky that I could afford to pay for private treatment. I’m well aware of that and, believe me, I’m grateful for it.

If cost really is an issue because of your life circumstances, there are some ways to get support at low or no cost. I don’t know about options outside the UK, but I will do my best with those available here.

Therapy can be available for free through the NHS, but getting access to it is a notoriously slow process. You’ll need to speak to your GP first of all. There’s more about this route on the NHS website.

You may be able to get help through a mental health charity. The best way to find out about those is through Hub of Hope, which is a national directory of all types of mental health services. They also have details of support lines you can call in case you need someone to talk to right now.

Many private therapists do offer a reduced rate if their full price is unaffordable, so if you can afford something each week, you can ask whether that might be an option. Mind has more information about finding and choosing a private therapist. It’s a good idea to know what you’re looking for and what questions to ask. On Counselling Directory, you can search for practitioners who offer concessions for people in certain circumstances including students, low income and unemployed people. Listings on the British Association for Counselling and Psychotherapy also include whether the practitioner offers concessionary rates, although you can’t include that in your search criteria.

Alternatively, there are online tools available. While these are not the personalised in-depth support a therapist can give, they can be very helpful for keeping your head above water and as an alternative to the kind of numbing actions that can damage your health, relationships and finances.

There’s Living Life to the Full, which offers free Cognitive Behavioural Therapy (CBT) based courses to help you understand why you feel the way you do and how to move into a more confident and resilient way of thinking, so you can feel better.

There’s also Moodgym, which is similar (and available globally) and charges £25.20 (inc VAT) for 12 months of access.

Finally there are lots of apps recommended by the NHS to help with different aspects of your mental wellbeing. Many of these are free to use, although they may have in-app purchases, and you can find them here.

Money and mental health is a tricky topic. I’ve only talked about my experiences and I was lucky in that my issues were relatively treatable. For more on how money and mental health interact you can listen to this episode of my podcast, Squanderlust, with Emily Reynolds.

"Bad with money" is a fixed mindset

After writing my post about why I don’t think there’s any such thing as being “bad with money” I was curious what other people thought.

I didn’t want to have to explain my whole blog post on social media, so I thought I’d just do a quick LinkedIn poll and see what came back.

Image shows a screenshot of a LinkedIn post and poll by Martha Lawton.

The post says:

“I'm getting increasingly annoyed with the phrase "bad with money". So many people say about themselves "I'm bad with money" and just shrug, as if that's all there is to it.

I don't blame individuals, because this is a common idea, but I think it's super unhelpful.

We can all grow and the label "bad with money" cuts people off from that growth.

What do you think?”

The poll question is “Are some people just “bad with money”?”

The answers are:

“Some people are bad with money” 23% of the votes

“Everyone can improve” 72% of the votes

“Other (please comment)” 5% of the votes

In my previous post I talked about how saying someone is “bad with money” or “good with money” is simplistic and disguises all the many different skills needed to manage money well.

This poll highlights another damaging part of the “bad with money” label. As with almost all labels, it promotes a fixed mindset. For those of you who aren’t familiar with fixed/growth mindsets, I’ll give a quick explanation.

A person with a fixed mindset believes that our skills and abilities have inherent limits beyond which no amount of practice, study and effort can take us. A person with a growth mindset believes we have infinite capacity to develop our skills and abilities as long as we practice, study and work.

A fixed mindset says that talent is everything, you’ve either got it or you haven’t. A growth mindset says that we all start from different places, but where we end up is a combination of our own efforts and the resources available to support us.

It’s worth noting that a growth mindset doesn’t say anything about the rate of progress, only that progress is always possible. Slow improvement still counts. It also makes it very clear that resourcing is important, this isn’t a viewpoint that says the world is a pure meritocracy and there are no structural advantages or disadvantages.

If you say that some people are just “good with money” and others are just “bad with money” and that’s all there is to it, you’re expressing a fixed mindset position about money. The trouble is that it’s a self-fulfilling prophesy. If someone is just “bad with money” why should they try to manage it? They are doomed to failure and might as well give up. Similarly there’s no point is trying to teach or coach anyone to get better with money if it’s just in their nature to be “bad with money”.

One of the people who commented on my post said something similar.

Image shows comment from Penny Delve

“The danger with labelling yourself is that you become that label. Our language is very powerful and our subconscious is always listening 👂.

We all create our own experience so there is a choice. So I voted ‘everyone can improve’ because we always have that choice to change Martha Lawton 🙌”

Not only that, but even people whose fixed mindset puts them in the “good with money” category, can end up very anxious about their money skills. This is because if your ability with money is fixed and you make a mistake or have a financial setback then a fixed mindset says that’s because you’ve reached the limits of your money ability. There’s no way to correct for the mistake in future. A fixed mindset may even tell you that you’re not as ”good with money” as you thought, perhaps even “bad with money” after all.

Worse yet, because in a fixed mindset every skill or behaviour is a fundamental unchanging characteristic of who you are, any time things go wrong that’s a sign you’re a lesser person than you thought. This means that a person with a fixed mindset who gets into debt will either see themselves as a helpless victim and expect someone else to fix the problem for them, or will be too ashamed to ask for help because it feels like exposing their fatal flaw.

It’s an insecure position to be in.

On the other hand, a person with a growth mindset around their financial skills will be actively seeking to improve and will perceive a setback or loss as a chance to learn. They can think clearly about whether they made a mistake or whether they just had bad luck. Neither answer is a threat to their sense of their own value as a person. If something goes wrong with their finances, even a serious debt issue, they will be ok asking for help and will hope that their adviser can help them understand how to fix things now and avoid similar problems in the future. People with a growth mindset tend to be open about their shortcomings because they see themselves as a perpetual work in progress. Today’s failing is tomorrow’s strength.

As you might guess from all of this, people who have a growth mindset about an activity, whether it’s money management, acrobatics or playing the bassoon, tend to achieve more in the long run, because they will usually be more persistent and creative in their approach to developing their skills.

The good news is a fixed mindset can grow into a growth mindset, it’s just a matter of talking about yourself and others slightly differently. Instead of saying “I’m bad with money” or “I’m good with money” (fixed permanent personal traits) you can say “I’m making a habit of tracking my spending, but I don’t do it every day yet” or “I’ve made a plan for my financial future and I’m happy with how well I’m sticking to the plan” (actions and outcomes).

You’ll find you feel more in control with a growth mindset and it will help you to a more secure financial and emotional future.

You can learn more about fixed and growth mindsets and Dr Carol Dweck who did the research around them in this episode of my podcast, Squanderlust.

No one is "bad with money"

One of the ideas I see in people who struggle to deal effectively with their finances is that they are “bad with money”. I hate this phrase. It leads to so much hurt, shame and frustration, and worst of all it’s tosh! There’s no such thing.

The idea that you can be “bad with money” or “good with money” comes from a simple assumption: that managing money is a single skill and you are either good at it or bad at it.

All-or-nothing.

Binary.

Simple.

Nonsense.

Financial success involves using a wide range of skills together, along with a measure of luck. If you tell yourself there is just one money skill and you don’t have it, you deny yourself the credit for all your existing strengths. This attitude will prevent you from realising what’s really going wrong in your money management and how to fix it. The vague undefined nature of being “bad with money” causes a sense of general helplessness that will always undermine your efforts to improve.

OK, so, what are some money skills?

• Self-knowledge - so you understand what you really want, what you really don’t want and what you are and are not prepared to do to get to your goals.

• Realistic goal setting - so you know where you want to go and whether that’s possible.

• Collecting and analysing data - e.g. what do my bank statements say about my current spending patterns? Where might those have come from?

• Planning - what, specifically, do you have to do to achieve your goals?

• Research and selecting reliable sources of information.

• Prioritising - making effective comparisons.

• Negotiating - whether that’s a raise at work, settling a complaint or a getting a better tariff for your bills.

• Assessing risk and being comfortable with uncertainty.

• Monitoring progress and adapting plans to changing circumstances.

• Reading comprehension, ability to identify key information in a lengthy document.

• Numeracy skills e.g. to compare value for money from different deals.

• Assertiveness - willingness to ask professionals awkward questions; willingness to say “no” to friends or family members when their plans don’t work with yours.

• Proactive problem-solving - spotting issues and resolving them quickly.

• Organisation to keep on top of your paperwork and avoid missing deadlines.

• Communication skills and empathy to navigate conflict around money with people close to you.

• Tenacity - for when things are unpleasant or challenging.

• Moderation and self-care - so you neither overspend your way into debt nor burn out trying to be over-frugal or hustling too hard.

This is not at all a comprehensive list, but hopefully it gives you a hint of the ways that managing money involves a range of skills in balance with each other and how you will use different skills at different times.

Once you see managing money this way, the idea of being '“bad with money” makes no sense at all. You might be missing some key skills, or not applying them to your finances, because you didn’t realise how they applied. I’m sure you have at least some of them though and once you start thinking of money management as the combination of the right skills at the right time, you can work out how you need to improve.

It all just becomes much more manageable. You can do this. One step and one skill at a time.

For more on all-or-nothing thinking and how it can mess with your finances check out this episode of my podcast Squanderlust.

Considering cost per joy

I spent my childhood in the countryside and my parents are keen gardeners. So when I was growing up there were always flowers around and flowers didn’t cost money. Occasionally, a guest would bring my mother a bouquet and she would treat this like a huge indulgence. I have memories too of her tutting at the price of cut flowers. She obviously thought is was wasteful to spend on something that was going to die in a few short days.

As an adult I carried this inherited attitude for years. As a reaction to my extremely frugal childhood, I sometimes overspent on clothes and shoes, cocktails and meals out, club entries and gig tickets and, of course, the much reviled “fancy coffees”. I didn’t buy myself flowers.

Sometimes a romantic partner would buy me flowers and I would be overwhelmed and almost resistant. It seemed an extraordinary act. Over time this feeling lessened but it never disappeared. If someone else wanted to throw silly money at flowers for me then that was their choice. To buy my own would be ridiculous. I was someone who would unthinkingly spend £35 on a forgettable lunch, but wouldn’t pay £10 for a bouquet that would make me smile for a week.

I remember the moment I realised how foolish this was. My then boyfriend, now husband, and I had braved drizzly weather and gone to Columbia Road Flower Market for a Sunday afternoon out*. I had chosen an array of blooms and foliage; some scented, some merely elegantly shaped. I was clutching them against my chest, almost up to my face, as a I walked to the train home. My mind was on which vase would suit them best for arranging.

I love London, but grey streets under grey skies can bring you down. Having this armful of living colour with me brought me so much joy. As a noticed my joy, I had a flash of insight. The flowers had cost the same amount as the tea and cake for two we had bought in a chichi independent café at one end of the market. I hadn’t thought twice about the refreshments. I was revelling in my flowers.

That was a defining moment in how I think about my non-essential spending. It stopped just being about whether something was cheap or expensive within its category of expenses (food, event tickets, clothing and accessories etc). I started to compare across categories and to think about how much joy each purchase would bring me for the price. This changed my appreciation of value and means I spend more wisely and get more from my purchases of all kinds.

I’m still more likely to buy coffee than flowers, because catching up with a friend is joyful too. (More than ever after months of lockdown.) However, I no longer rule out a whole type of spending without considering it first, and I suggest you don’t either.

Did this blog post make you think? You will probably enjoy the episode of my podcast, Squanderlust, where we talked about ‘mental accounting’ and the weird tricks our minds play on us about prices. Listen here.

*For those not in the know, Columbia Road stall-holders discount their plants and flowers after about 1pm, so they can pack up and leave with minimal waste.

Money isn't food - do you treat your pay like it has an expiry date?

I have a long-held theory that, on some level, many of us secretly treat money like it’s food. We don’t do it on purpose, but our poor old monkey brains struggle with the concept that we keep a stock of otherwise useless tokens in order to trade them for the things we need later. Why would anyone give you a thing you want in exchange for a useless token? Make money even more abstract (just a number on a screen) and the monkey mind gets completely fuddled. Why are we keeping the numbers high? What use are they? They are only useful when they get us stuff. Stuff is real. Numbers on a screen are not real.

I think for some (read many) people our subconscious minds try to make sense of money by deciding it’s just another type of food that we ‘eat’ by spending it.

It’s well-documented that people whose eating is disordered also often have money issues. This is not only because some eating disorders are expensive, but because the same attitudes of perfectionism, self-denial and shame and around pleasure and self-care that drives much disordered eating, also affects our feelings about money.

So, if we unknowingly, secretly believe money is food and we get the value of it (eat it) by spending it, of course we don’t want to save it. If you save food for too long it goes off. I think some of us deep in some part of our brains believe money will too! This goes double if we’ve never saved successfully before. Until you have saved successfully you have no evidence that money can be stored and not decay.

Of course, the rising cost of living does, to some extent, reduce the value of money saved over time. To make sure money keeps pace with inflation and ideally outgrows it, that money must be put to work, i.e. invested. Here I think we can come to an analogy that might be ancient enough to allow our under-evolved brains to grasp it.

Money isn’t food, or at least it isn’t just food, money is seeds. If you can convince yourself that money is grain you can start to get a feel for what you need to do.

When you get your grain harvest (pay cheque) you don’t grind and eat too much of it, because you need what you can get for future crops. You plant it (invest) in the best locations you find, but maybe not all in the same field in case something goes wrong in that one field and you lose all your crop (diversify). You also hold a bit back in case the crop fails and you need to sow again or in case you miscalculated and your food stores run low (save).

Seeing yourself as a money farmer, instead of a consumer, makes it easier to remember what you have to do to shift away from living pay cheque to pay cheque, and start saving and investing for your future.

Now go out and tend your crops!

Does this post sound like you? Or someone you know? Share it and tag me in @marthalawton on Twitter or @squanderlustpod on Twitter, Facebook or Instagram.

The first time talked about this idea was on the Seize The Moment podcast and you can watch the whole show here or jump to 3:25 where I talk about treating money like food.

Need the willpower to stop overspending? Cut out scratchy clothes labels

Have you ever got up in the morning with the best frugal intentions, then by night time you find yourself looking at an order confirmation email wondering how you ended up browsing for window boxes or signature scents in the first place?

You have just been caught out by ego depletion and you are not alone. Ego depletion is the term for the way your willpower gets drained through the day by the effort it takes to meet the challenges we face. Every time we face a challenge or temptation we have to decide whether to take the option with the best long term outcome or the one with immediate rewards and these are often not the same option. research ahs indicated that willpower is like a muscle and as you use it through the day, it gets tired.

Basically, you can only be patient, tolerant and self-denying for so long before you run out of willpower and do something that feels good in the moment and damn the consequences. That might be snapping at a co-worker, eating a grab bag of Hula Hoops or treating yourself to some fancy new underpants from that store that always emails you.

Let’s face it life sucks sometimes and growing more willpower just because we want to isn’t really an option, so how can we make the best use of the willpower we have?

Get rid of minor irritants

Wherever possible:

• Cut out scratchy labels and donate or sell stiff, itchy or tight clothing and shoes that pinch;

• Learn about your devices’ settings so you can customise them for your personal preferences;

• If there are tools or pieces of equipment you use often, make sure it’s the best quality you can afford, so you’re not frustrated by bad design or shoddy construction;

• Ask colleagues, family members, friends and neighbours to change habits they may have that annoy you, it’s possible to have these conversations tactfully and still ask clearly for what you want;

• Consider noise-cancelling headphones for times when you need to focus;

• Keep your environment at a comfortable temperature, clean, pleasant smelling and uncluttered.

Generally pay attention to low-level irritants that drain your willpower without you even really noticing. The more of these you’re putting up with, the less willpower you have for making positive choices when faced with temptations.

Look after your health

Physical and mental discomfort from poor health is something that drains willpower

• Do what you can to get enough sleep;

• Eat well so you’re not hungry, sugar-crashing or suffering from indigestion.;

• Move your body and stretch often, so you don’t end up stiff and cramped;

• Ensure your work environment is as well-designed and ergonomic as possible, so you’re not straining to complete tasks;

• Don’t overdo the screen time and stay away from social media drama;

• Find ways to relax, ideally somewhere quiet in nature, and take a few deep breaths.

Treat yourself (in moderation)

Pre-emptively doing small, nice things for yourself will help you to replenish your willpower and avoid the need to vent, binge or splurge. This is why no spending plan should completely exclude treats. You know what treats look like for you, make sure you have a supply to keep you going, so you don’t feel deprived.

Celebrate your wins (including times when you successfully exercise willpower). Giving yourself a pat on the back is an immediate reward and takes the edge off the pain of delaying gratification.

Finally, forgive yourself. If you are fighting the willpower war on too many fronts and lose a particular battle, don’t get too down. Instead think whether you’d be better served easing up on one or two areas and focusing your efforts elsewhere. Nobody’s perfect and a constant feeling of failure is a drag on willpower too. If your focus is your finances, just keep everything else ticking over for now. Once you’ have your money in better shape, you can choose a new goal elsewhere.

If you want to hear more about ego depletion and the science behind it, listen to this episode of my podcast Squanderlust: Episode 3. Willpower Outage.

How to be more optimistic about money

It’s Mental Health Awareness Month and one feature of poor mental health is a skewed sense of optimism, so this post is about that.

Optimism is a funny thing.

Too much and you don’t prepare for the worst. I’ve been vocal about how often people don’t buy insurance or save for emergencies because they assume bad things happen to other people.

On the other hand, if you’re too pessimistic, you won’t take the action you need to improve your situation, because, well… what’s the point?

So we want to build a Goldilocks mindset around money and get amount of optimism just right.

Thankfully, there’s some great evidence about what can help us to think more positively without losing sight of reality. Positive Psychology is the study of happy, mentally healthy people with the aim of learning how everyone else can be more like them.

The founder of positive psychology, Martin Seligman, identified three key attitudes towards life’s challenges that lead to either a more optimistic or a more pessimistic viewpoint, with the optimistic view generally leading to better outcomes overall. These are called the “three Ps” of pessimism.

People who are pessimistic tend to see setbacks through the lens of Personalisation, Permanence and Pervasiveness. What do these mean and how do they play out in terms of our finances?

Personalisation

“It’s all my fault!”

Personalisation means assuming that bad events happen to you because of something about yourself. It means assuming all the blame, whether that’s realistic or not.

Financial examples:

At the less harmful end of the scale, this might look like a homeowner who engages a builder and finds the final bill is higher than expected. The builder may have been unclear about their costings or have inflated a price somewhere, but if the homeowner tends to personalise they will feel angry at themselves for not having checked the costs more thoroughly sooner.

At its most harmful, this could look like a person who feels cursed with bad luck on some level so that they blame themselves when things happen that are completely outside of their control. For example, their chosen retirement date may happen to coincide with a small fall in the stock market (leaving them with a smaller pension pot than they had expected) and they feel in some secret part of their heart that the stock market fall happened because they were due to retire that day.

The optimistic view

A person with an optimistic viewpoint understands that the must take responsibility for their actions, but only in proportion to their potential effects. They do not automatically assume that they are at fault if things go wrong and they certainly don’t blame themselves when the outcome is largely or entirely due to chance.

Advice

If you tend to assume that setbacks are always your fault, try to challenge this by thinking about who else influenced events and what role chance played in the outcome.

Permanence

“It’s never going to get any better.”

Permanence assumes that any change for the worse is going to last forever. It says that once something goes wrong, this is just how things are now.

Financial examples:

A person asks for a pay rise and is refused. They assume that their employer will never agree to pay them more or promote them in future. They become discouraged and underperform or look for a new job.

Another example, a person accidentally misses a bill payment and it shows up on their credit record causing their credit score to fall. They assume that this means they could never get a good deal on a personal loan, let alone a mortgage.

The optimistic view

Things change all the time and there are often solutions to issues, even if you don’t know what they are when the problem first arises. Just because things are difficult now doesn’t mean they can’t improve.

Advice

Think of a time when you faced difficulties in the past that no longer affect you. Things may have seemed bad then but now you' barely remember it happened. Whether through resourcefulness, hard work, luck, or just letting time pass so that an issue became less relevant, you have overcome and moved on. Times always change, and nothing is permanent, including your troubles.

Pervasiveness

“One thing went wrong - everything is terrible!”

In this mindset, a small difficulty or embarrassment is a sign of a much larger problem. Specific issues that could be fixed with specific actions are generalised into fundamental flaws or failings to big and all-consuming to solve.

Financial examples:

A person whose card is declined declares themselves “hopeless with money”, even though with a bit of practice at planning and avoiding overspending they could avoid this happening in future.

A person makes a failed insurance claim and says “all insurance is a scam”, even though the problem is just with this single claim and they have many steps they could take next including: checking their policy terms to make sure they claimed under the correct part of the cover; submitting more evidence to the insurer; or making a complaint.

The optimistic view

The optimistic person gives life a second chance and waits for a clear pattern to emerge before generalising. The take each issue as it comes and try to find solutions to each one.

Advice

Listen to how you speak and identify when you’re using words like “everything”, “nothing”, “always” and “never”. These are often a sign of Pervasiveness in your thinking. Other signs are using generalising/labelling phrases like “I’m so…” or “Banks are…”.

When you catch yourself using this language try to replace it with the specifics of this incident. That will give you a more realistic viewpoint and potentially help you identify solutions to the issue at hand.

Learning to drop the three Ps will help you keep negatives in perspective so you will feel more in control of your money.

Did you find this useful? Comment below if there’s a mental habit you’re going to change.

To learn more about money mindsets listen to my podcast Squanderlust.

The mindset shift you need to feel confident negotiating

Who here loves negotiating?

Yeah, ok, that one weirdo standing up and waving enthusiastically, we can see you. We can also see all the people who almost crawled under their chairs at the thought.

Do you think negotiating is all about bullying someone into submission?

Do you think it’s about who can play the dirtiest tricks?

Does the word negotiation conjure up images of high drama; staring contests, fists slamming into tables, threats to flounce from the room and so on?

Do you secretly believe you have to be an ‘alpha’ (lol) to get your way in negotiations?

Negotiating is one of those things that many people mentally put somewhere between “I’d rather not” and “can’t I just have a root canal instead?”. Actually a small shift in mindset and it needn’t be painful at all.

The truth is everyone negotiates. If you have worked out who’s going to do the vacuuming and who will take the rubbish out with your partner or housemates, you have negotiated. If you have told a child they can have a treat as long as they’re quiet until the grown ups finish talking, you have negotiated. If you’ve coordinated with a group of friends about when and where you’re going to meet up and hang out (those were the days!), you’ve negotiated. Everyone negotiates it’s just a questions of how, with whom and over what.

Funnily enough, we’re often happy to negotiate in settings where money doesn’t come into play. but when one of the factors we’re discussing is money, suddenly we realise we’re negotiating and it all feels much more scary somehow. It doesn’t have to be that way.

Negotiating doesn’t have to be a competition, it doesn’t have to be a zero sum game. Often a really good negotiation is less of a fight and more of a collaborative problem solving process. Ideally you’re trying to get to a win-win outcome.

If you struggle to negotiate because the idea frightens you, make a list of the times you had a friendly discussion with someone about what they need and want, versus what you need and want and tried to find a solution that works for everyone. How did it go? What helped you find a good solution? Were there ways you were able to be creative so everyone ended up happy?

This is your successful negotiations list. Take this same mindset you had in these situations into negotiations that involve money. You’ll feel more confident and get better outcomes.

To learn more about negotiating, I recommend Getting to Yes * by Fisher, Ury and Patton, it’s a great book that massively boosted my confidence in negotiating in business settings and elsewhere.

If you’re specifically negotiating a price for your time (as an employee or self-employed) you can listen to this episode of my podcast, Squanderlust, where we talked with start-up mentor, Jasper Lyons about exactly that.

What are your best negotiating tips?

(*Yes, this is an affiliate link. Buying from Bookshop.org helps support independent bookshops and I get a small % of the purchase price.)

We all make money mistakes (even Martin Lewis)

A few years ago I was at a financial education conference where the big finale was a Q&A with Money Saving Expert, Martin Lewis. (It was pretty exciting. Yes, I am that much of a nerd.) He was a great speaker, as expected, but only one thing has from that session really stuck with me. That's the question he didn't answer.

A member of the audience asked if he'd ever made any money mistakes and, if so, what were they? Martin laughed and there was a flash of pain and embarrassment across his face, as if he'd been reminded about a proper blunder. Then he said he had made mistakes, but he didn't want to give details. Now, that's totally within his rights. Maybe his biggest mistakes involved other people's private business, or maybe he just didn't want some silly tabloid article coming out the next day, taking what he said out of context. But it also says something about how we talk about money in this country.

There are the experts who are often portrayed as if their financial decisions are flawless, and then there are the rest of us with our forms we haven't posted yet and our unopened bank statements and that insurance that auto-renewed, even though we know if we shop around we'll get a better deal. I hear so many people say they are 'bad with money'. I also see a lot of people become overwhelmed by the idea of sorting out their finances. I think it's because they compare themselves with the 'perfect' experts, who seem to have it all sorted out.

If you relate to that feeling, I want you to take heart, even Martin Lewis has made money mistakes. (Though he's keeping them to himself.) Instead of trying to reach financial perfection, just aim for a bit better than yesterday. See if you can get good enough with money. Good enough is just that, good enough. Better than yesterday is still better. Take action to improve and then celebrate your progress, instead of getting down because you're not perfect. We're all still learning every day.

When I started my podcast, Squanderlust, being open about my own money fails was an important part of the philosophy of the show. You can hear my former co-host, Alex, and I talking about it in our very first episode.