People are so incredibly complex that there is no good way to sum up people as a whole. Every person has their own thoughts, feelings, personality, genetics, upbringing which all play a collective role in the construction of our psyche. Many of our outwardly expressed traits represent the core of who we are. These need not necessarily be changed in order to achieve financial wellness, though they should be understood and be in our control.

Environmental factors make up the other component of our financial personality. These have been impressed upon us and may not necessarily reflect who we are or who we wish to be. Our major environmental influence is our parents and family life; though you may not want to accept it, your personality is a product of your parents example. Financially, their example was reflected in their expressed opinion of money; expressed both verbally and physically.

For example, perhaps you grew up in a poor home with very little money. Every dollar counted and was meticulously accounted for. The outward expression shown is that money equals life and must be carefully counted to survive. Perhaps the parents mood corresponds with their bank account. When money is tight, they are easily agitated but your best friend when times are better. Now, money represents both life and vitality. This family and their children now have a propensity to be very tight with money and considered selfish by others, being reluctant to give and always ready to accept a handout; because we don't give away our life and vitality it is to be cherished. Money is Money, nothing more. We must learn to treat it as so, and appreciate it for what it is and is not.

If we add to the above scenario a father who not only ties his mood to the bank account, but his spending, so that whenever there is some money the family eats out, buys lots of nice things, and enjoys life, and when they are down on their money, they are agitated, sad, the children repressed, waiting until they can live again. Not surprisingly, this is a common scenario. In this case the father is teaching his children what he probably learned from his father; that when you have money, spend it, because it won't last long.

The justification for this belief can be diverse. Perhaps the father truly feels that money is like water in a leaky bucket. We pour water in, and then use it before it falls out the bottom and is lost forever. If this were the case, then money should be spent as quickly as it is received so that the least amount is lost out the bottom. However, if you were to fill a bucket up with water with the intent to water your flower garden and set it out on the back porch, you should reasonably expect the water to be there when you come back, and if there is a 0.25" hole in the bottom, then to effectively use that bucket means plugging the hole, not watering the weeds next to the house because you loose too much water walking to the flower bed.

There are many things to point out from the analogy of this family. First, the children will probably grow up with the same understanding of money flow (ie. out the bottom of the bucket) as their father and act accordingly. Second, this understanding is wrong. Money does not leak out of our accounts, we take it out.

We will focus on the first point, that your environment growing up does influence our money mentality. Your parents will have conditioned you with both good and bad opinions. Which is good and which is bad is abstract and totally dependent on your goals in life and the basis for comparison. The point is that we need not accept the conditioning of our parents and family as what is right for us. Neither should you wholly accept my opinions, for though they are right for me, your situation is different.

What you should however, is think about the opinions you currently have and why you have those opinions. Do you feel that money is evil? Could this be because your mother hung a plaque in the entryway that said 'money is the root of all evil'? Do you hate the IRS? Could it because with every paycheck your father would rant about how much money the government was 'stealing' from his check, or how much food they were taking off your table. What are your current conceptions about money? Are they positive conceptions or negative. Ultimately you should formulate your own opinions about money keeping in mind that if you have a negative opinion of money, you are more likely to avoid it. If you believe that only bad people have money, you will want to get rid of it, either by spending it, or giving it away. Perhaps this belief is a product of your father always calling his boss a crook, or that honest money is hard earned money? Well there is a big difference between earned and hard earned and the difference is not in being earned.

You will ultimately do with your money that which makes you happy, this is the nature of people, but in deciding what makes you happy, remember that a negative opinion of money will negatively impact your attraction of it.

The following chapter (Chapter 3 - Psychology of Money) will discuss our Financial Paradigm and how to change it.


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