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How your childhood can shape financial decisions as an adult

Financial therapy studies your past and current money patterns to improve your life. A financial therapist explains how financial therapy can help you.

What is a financial therapist?

When I became a firefighter at age 19, I inadvertently found a completely different career path. At the station, in between calls, I’d hear the older firefighters talk, with conversations frequently hitting on two subjects: Marriage and money. No matter what the issue, the common theme was that my coworkers and their partners were often on different financial pages.

Twenty years later, I’m a counselor and educator in the emerging field of financial therapy, which studies financial behavior through a psychological lens. Money and finances are deeply personal, and our habits and patterns around money are hard to change. A financial therapist’s job is to help you figure out the “why” behind what you do with money.

How does financial therapy work?

You may already know that budgeting is important, but do your best efforts fall apart? Why is it?

Often, financial behaviors are rooted in the subconscious and unconscious parts of your brain, as well as the conscious.

The conscious is what you are thinking about and are aware of, like the budgeting apps on your phone. The subconscious is just outside of your awareness, but if you stopped to think about them, you’d remember. This might be the comment you made to your spouse this morning about how you wanted to save more money. The unconscious is comprised of memories and concepts that may be buried deep down. This could be your parents running out of money before the end of every month, creating regular financial stress in the home.

Information stored in your subconscious and unconscious is the key to unlocking the reasons you spend or save the way you do, and a financial therapist can help you gain this insight.

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Go back to go forward with your money habits

The philosophy behind financial therapy builds upon the work of the psychiatrist Murray Bowen, who theorized that a family operates as a unit. If a person is having difficulty, their problem stems from the way the family unit interacts. The Bowen theory maintains that anxiety and pain can pass through generations.

The concepts can be complicated, but the Bowen theory maintains that anxiety and pain can pass through generations. Here’s an example: As a kid, your dad was laid off. Instead of getting angry at your dad, your mom projected her concern onto you, telling you to buckle down and get good grades. Chafing under pressure, you choose a college across the country and minimize contact with your parents. But does that change your feelings? Probably not, according to Bowen, who suggests that the cycle of ambition, anxiety, and pressure may continue once you have your own child. As a kid, the concern over success was not supposed to be “yours,” but you inherited it and may be unconsciously playing through these patterns in your own family right now.

We each inherit a “money map” handed down from generation to generation. Part of the money map is unique to the beliefs and behaviors of your family, while other parts of the map are shaped by cultural beliefs, economic realities, and societal norms.

For example, a person whose own mother or father grew up in poverty may grow to have a very different approach to money than someone whose mother or father grew up in an upper-middle class environment. The money map is also influenced by non-financial factors, such as the death of a parent, a job loss, or a positive event, like a marriage or move.

When people seek help from a financial psychologist, they are not solely dealing with money issues. They are also dealing with past and present underlying issues that affect their relationship with money. Ultimately, financial therapy is about seeing you in relation to your lived experiences and then helping you find a new direction that allows you to live open-hearted and trusting of yourself and others.

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Understanding yourself

When I work with couples they can identify who is the spender and who is the saver in the relationship, but what they don’t understand fully is why they have taken on those roles and what it all means for the relationship. The couple has created an emotional unit that is likely continuing the relational and financial patterns they observed in their childhoods.

Everyone has a family money map — and a trauma like a job loss or divorce isn’t the only thing that can shape the way your money views have been formed. Facing and growing your understanding of your own family — and talking about it with a partner or a professional — can help you understand habits, blind spots, and issues that continue to crop up in your own financial life.

Ed Coambs, MBA, CFP® is a former firefighter with a passion for helping people in crisis. After a successful career at Vanguard and having recognized the need to bring an understanding of relationships and psychology to financial planning, Ed became a CERTIFIED FINANCIAL PLANNER™ professional and licensed marriage and family therapist. Ed enjoys helping couples find common ground in their finances so that they can fully flourish in life.

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Haven Life is a customer-centric life insurance agency that’s backed and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe navigating decisions about life insurance, your personal finances and overall wellness can be refreshingly simple.

Our editorial policy

Haven Life is a customer centric life insurance agency that’s backed and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe navigating decisions about life insurance, your personal finances and overall wellness can be refreshingly simple.

Our content is created for educational purposes only. Haven Life does not endorse the companies, products, services or strategies discussed here, but we hope they can make your life a little less hard if they are a fit for your situation.

Haven Life is not authorized to give tax, legal or investment advice. This material is not intended to provide, and should not be relied on for tax, legal, or investment advice. Individuals are encouraged to seed advice from their own tax or legal counsel.

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Haven Term is a Term Life Insurance Policy (DTC and ICC17DTC in certain states, including NC) issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and offered exclusively through Haven Life Insurance Agency, LLC. In NY, Haven Term is DTC-NY 1017. In CA, Haven Term is DTC-CA 042017. Haven Term Simplified is a Simplified Issue Term Life Insurance Policy (ICC19PCM-SI 0819 in certain states, including NC) issued by the C.M. Life Insurance Company, Enfield, CT 06082. Policy and rider form numbers and features may vary by state and may not be available in all states. Our Agency license number in California is OK71922 and in Arkansas 100139527.

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