Last updated on September 11th, 2020 at 11:45 am
Dads, how healthy is your relationship with money? Yes, you heard me right, you do have a relationship with money, whether you are aware of it or not. And, just like other crucial relationships in your life, it will require time and effort to nurture and grow a healthy relationship with money.
Take a moment to look into your past… As a child, how did you learn about money? Do you remember specific discussions with your parents or guardians? Did you observe their relationship with money? Did you learn about money in school? How about right now… who is in control of your relationship – you, or your money?
Like you, I am bombarded by information. We live in a truly wonderful age… a period in our world’s history of unmatched intelligence and creativity. From time to time, however, a specific piece of information enters my mind and heart with great force. It’s a single idea that captures my imagination, causes tremendous reflection, and transforms my life. Well, I had one of those moments a couple of weeks ago, and I’ll share it with you in this post.
A Complex Relationship
“Everyone has a complex relationship when it comes to money. How you acquire, spend and manage money is largely due to two factors: the nurturing you received during childhood about money and values, and the way you organized this information in your mind. For example, if you value religion, you might tithe to the church. Or, if you value education, you may prioritize college savings.”
My purpose is not to tell you what to do with your money. After all, I’m not a financial planner, and I don’t know your specific situation. Rather, my purpose is to take you on a journey of discovery, because Affluent Dads have a healthy relationship with money.
What Would The Rockefellers Do?
I am reading a book entitled “What Would The Rockefellers Do?” In the book, authors Garrett B. Gunderson and Michael G. Isom share that there are “five main money personality types”:
- Saver: “A saver is fantastic at building wealth and saving money for the future, but they tend to focus more on worry and live with a scarcity mentality.”
- Spender: “A spender wants to enjoy life at all costs, and has a tendency to overspend on consumptive expenses.”
- Avoider: “Avoiders tend not to want to deal with money, ever. It’s a source of frustration, so they just push it off.”
- Giver: “Givers often have internal belief systems that make them believe money to be corrupt or evil, or that if they have too much money, other people don’t have enough. A giver’s strength is being generous and giving; their weakness is giving too much and finding themselves in financial trouble.”
- Amasser: “An amasser loves to make a lot of money and loves to spend a lot of money, loves to save a lot and loves to invest a lot. And if they can’t do all of that every single month, it hurts their confidence. Amassers tend to think about money often.”
I Am A Saver / Amasser… My Wife Is A Spender
My wife, Morgan, and I are perfect for each other. Those who know us personally understand that in many regards we are polar opposites. While I am reserved, shy, and quiet, Morgan is outgoing, confident, and animated. I want to scrimp, save, and budget, while Morgan wants to actually enjoy her life. I think about money a lot. And honestly, it’s for that reason that I am writing this blog post.
There is nothing wrong with being a saver, nor with being a spender. These “five main money personality types” are not supposed to be negative. They are simply broad explanations for the most common relationships that human beings have with money. When coupled with some basic strategies outlined below, we can finally experience peace with who we are at our financial core.
Garrett B. Gunderson’s and Michael G. Isom’s Recommendations
- Saver: “If you are a saver, setting up a Living Wealthy account can help you allocate a portion of your income for guilt-free spending.”
- Spender: “If you are a spender, work to set aside at least ten percent of your income into savings. You can still spend and enjoy life, but you will set yourself up for success by taking the first ten to fifteen percent and putting it away.”
- Avoider: “If you have that tendency [to be an avoider], hire a bookkeeper or a coach or a mentor, or find a friend or spouse who can take on that role and hold you accountable.”
- Giver: “A proper structuring of accounts—including a Charitable Giving account—can help a giver manage their giving.”
- Amasser: “If you are an amasser, organizing your finances and understanding your cash flow can help ease your mind and keep you from being consumed with thinking about money. Create a second scorecard other than money. What makes you feel fulfilled? When do you feel best and what difference would you like to make in the world? By taking action in these areas without only considering how much money it will make, you can be a helpful amasser without having all of your self-confidence in your cash.”
At Peace With Money
There is not a one size fits all approach to developing a healthy relationship with money. What works for me might not work for you, and that’s okay. But I think each of us deserves to be at peace with money.
For many years I have been a penny pincher… Looking back, this mentality has caused debilitating stress in my life. This stress transforms me into someone that I don’t want to be around. Well, this simple concept of setting up a “Living Wealthy” account has literally changed my life. My wife and I have a system in place that is propelling us toward financial independence. We are doing great things financially, so once these obligations are met, we might as well enjoy the money we are making as well, guilt-free. It seems so simple, to create this “Living Wealthy” account, but the peace and joy this seemingly insignificant idea has brought into my life is proving to be incalculable.
I have focused incessantly for years on making more money all in the name of just having more money. What I have come to realize is that earning money simply for the sake of accumulation won’t bring joy. Instead, being intentional about why I want and deserve the money, and what I’ll do with it once I have it, is what leads to true fulfillment. There is nothing wrong with saving and accumulating wealth, but my focus has shifted to treating money as a means to an end, and not the end itself.
Don’t Be Steve Frazelli
Let me share a quick illustration of this concept: that money is a means to an end and not the end itself… I love the 2003 film “The Italian Job.” In the film, a group of thieves steal millions of dollars worth of gold in Venice. As they are making their getaway, the group begins to discuss what they are going to do with their share of the gold.
Each man has a specific item that they intend to purchase. However, when Edward Norton’s character, Steve Frazelli, is asked what he intends to buy, he simply says that he’ll take one of everything that everyone else wanted. Shortly after this conversation Steve betrays the group and takes off with the gold.
Years later, the group finally tracks Steve down. Ironically, he really did just buy what everyone else wanted. Mark Wahlberg’s character Charlie Croker said: “You’ve got no imagination. You couldn’t even decide what to do with all that money, so you had to buy what everybody else wanted.”
Nurture Your Relationship With Money
Of course, you should not accumulate wealth through theft. The concept I am trying to illustrate is that Steve was so focused on the status and prestige that came with money, that he was ultimately willing to sacrifice every meaningful relationship he had in his pursuit. And in the end, his pile of gold did not bring him any lasting satisfaction.
It’s okay to nurture your relationship with money. There is an overabundance of opinions about money… Whatever your personal opinion, you can’t deny that money solves problems; not only for you and your family, but for society at large. We all have an incredible opportunity to care for our financial resources. Just like our relationships with a spouse and children, as we dedicate time and effort to nurturing our relationship with money, we can experience joy.
Hint: One stroke of inspiration can change your life. As you read this article, if there was a thought that came to mind on how you could develop a healthier relationship with money, why not take a chance and act on it? And if you’re willing, let me know in the comments what action you intend to take.