Perhaps money can’t buy happiness — but it’s all too obvious these days that spending more than you have can bring misery, and cause stress and anxiety that take a toll on your health. Fortunately, help can be had with a new form of therapy that specifically treats what Brad Klontz, PsyD, coauthor with Ted Klontz, PhD, of Mind Over Money: Overcoming the Money Disorders That Threaten Our Financial Health (to be published in December 2009), calls “money disorders.”
Even before the recession, nearly 75% of Americans identified money as the number-one source of stress in their lives. At present, the average American household owes more than $10,000 in credit card debt and saves at a relatively low rate of about 5%. Given these numbers, it’s not surprising to learn that many suffer from money disorders, such as overspending, serial borrowing, compulsive gambling, workaholism, underspending (Depression Era mentality or hoarding), financial dependence or financial infidelity (withholding financial information from a significant other).
“Financial therapy goes beyond the balance sheet to uncover the root causes of money disorders,” Dr. Klontz said. The goal is to identify your “money scripts” — unconscious beliefs associated with money that drive your financial behavior — which in turn helps remove psychological barriers to changing your relationship with money, and enables you to eventually improve your financial health.
It’s not the lack of funds that is the problem — with money disorders, Dr. Klontz points out that financial problems are the symptom, not the disease. In most cases, early childhood experiences around money lead to a set of problematic money scripts that create problems in your adult life. The first step is being honest with yourself about your financial problems and making a commitment to change.
People who routinely overspend or avoid dealing with their finances are following what Dr. Klontz calls “poor scripts.” Poor scripts include statements such as, “My net worth is equal to my self-worth” … “It’s okay to keep secrets about money from my spouse” … “The more money I have, the happier I will be.” In his practice and at workshops, Dr. Klontz helps people change their “poor scripts” to “wealth scripts” — such as “It’s important to save money for a rainy day” and “Giving money to others who are in need is something people should do.” You have the ability to change your own money mind-set, he stresses. Creating a new script to recite to yourself eventually transforms it to your new reality, which is how you change your financial trajectory. “Regardless of your starting point or your current financial situation, you can quite literally rewire your brain for wealth,” says Dr. Klontz.
To help people get to the bottom of their money disorders, Dr. Klontz and his team conduct workshops (www.onsiteworkshops.com) around the country. A psychotherapist and a certified financial planner (CFP) run each intensive six-day program. The programs include experiential therapy, in which participants explore past experiences with money to work through unresolved conflicts and emotions about it… practical lectures from a financial planner on risk management, tax strategies and retirement planning… and 45 minutes a day of mindful meditation to reduce anxiety.
If you know what you should be doing with your money and just can’t seem to do it… if your financial behavior feels out of control… or if you are suffering from significant emotional, social (e.g., relationship problems) or financial consequences of your behavior, it’s time to seek help. According to Dr. Koontz, warning signs include…
Financial therapy is still a very new field, and Dr. Klontz notes that at present there is no established accreditation — although he and his colleagues are working on this. He has trained dozens of therapists and financial planners around the country and has set up a referral list at http://www.yourmentalwealth.com, where you can also take a financial health test to gauge the relative severity of your issues if you are feeling stressed about money.
There are other options, too — you may be able to find a local therapist who works in financial psychology by asking financial planners for a referral. Some people find it useful to see both a therapist and a financial planner — but this can be expensive. Another solution is to investigate free self-help groups, meditation classes and lectures at local community centers and places of worship. All around the country, people who have been downsized or face other financial setbacks are banding together to help each other develop new marketable skills and find new ways to make ends meet. Of course, it is challenging… but it also is an opportunity to change your money script and get on the right path to financial wellness.
