I have struggled with money since college. But I never realized that I struggled with money until I moved away from home and had my first big girl job with benefits and retirement plans and dental (oh my!). For me, the light bulb moment happened when I had to go to the emergency room. The visit, the meds, and the many many follow-ups that resulted had to go on my credit card. They had to because I had maxed out what little savings I had by moving for my job. That was the big great oof of my financial life. This was December 2011.
Since that moment, I have been searching for ways to be better with money. In retrospect, I failed. I know this because in January 2012 I decided to get smart and write down what I spent. I tracked it all in spreadsheets. And then never looked at it again. However, as I have been tweaking my financial plans, I have looked back at those old documents. And boy did I notice an epic surprise. In January 2012 my credit card debt levels were around $5000. Not great. But not abominable. Especially since, as I just said, 2012 was going to be all about the big financial fix! So how did I do? Well, let’s look at January 2013, shall we? My credit card debt was just under $9000. WHAT!
Despite this blunder, I have managed to make significant progress on debt reduction this past year, getting my credit card balances back down to where they began two years ago. But having wasted 2 years of my life, I have been thinking alot lately about why, when I thought I was in “get my shit together” mode, I managed to overspend so much.
The answer: my psychological relationship with money.
I have a terrible relationship with money. I am not sure how or where it started, but’s it’s real and it’s deep and it’s incredibly unhealthy. It’s the boyfriend who pinches your hip and says, “Time to lay off the donuts!”. It’s the well-meaning but harsh mother who constantly bemoans your lack of relationship and comments on the barrenness of your womb in public. Not good.
So I am trying to repair the damage and build a healthy cozy relationship with my money. One where we respect one another’s opinions and vantage points. Where we support each other’s career moves and personal choices without judgement. Where we bring each other cups of hot cocoa on cold winter days “just because”.
Step one: change my language around money. For me, the words “budget” and “debt reduction” are associated with negative feelings and deprivation. To be on a “budget” means living without. It means restriction. It means passing on all the things that I think provide a full and rich life. The idea of “debt reduction” echoes through my brain like a mean old school marm scolding me for my impractical choices. It’s the doctor telling me to lose those extra 10 lbs. It too means restriction and denial of my instinctive wants (a.k.a., donuts).
Most people can handle these negative words just fine. But I can’t. I hear them, and like a stubborn three year old who refuses to adhere to bedtime, I shout back at my subconscious “I DON’T WANNA!”. I devolve into the “treat yourself” mentality, where a bad day at work or the grief of difficult break up yields additional interest collecting on a credit card. It’s more destructive than soothing. (And just in case you were wondering, I have the same type of psychological relationship with the word “diet”).
So taking a nod from the Positive Psychology movement, I have decided to reframe the language I use to talk about my personal finances. I choose to use words and phrases that put an empowered spin on my financial situation. My “budget” has been renamed my “financial plan”. And my “debt reduction strategy” is now my “road map to financial freedom”. These phrases sound fluffy and have a lot of syllables between them. It’s been difficult to implement and stick to it. But there is something profound in saying no to lattes out with my co-workers because “it’s just not in my financial plan right now”. The other nice thing is that these phrases are not just limitted to describing my primary financial goal (debt elimination) but they expand to fit the next steps in my journey–building up an emergency fund, funding my retirement, saving for law school, saving for a house, and saving so that I can someday achieve financial independence.
What about you? How do you feel about the language of money? Are you renaming your “budget” too?