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Section 11
Control over Finances

Question 11 | Test | Table of Contents

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In the last section, we discussed contradicting attitudes about money: Money is good and money is evil.

In this section, we will discuss post-holiday stress related to over-spending or your money trap and a plan to get on the path to financial stability and a Prescription for Your Financial Health. Do you agree that your current holiday let-down or depression may be due to some over-spending you may have done? Are you caught in a money trap?

The holiday season is over, and as you look at your checkbook or see your credit card statements, do you get a sinking feeling in your stomach? Do you feel intense anxiety when you realize how much money you spent during the holidays? Do you feel that you have no control over your mounting debt?

You don't have to feel trapped by your financial situation. There are many ways you can regain control and develop a healthy relationship with your money and spending habits. I will discuss three: uncovering hidden thoughts and attitudes about money, developing an attitude of gratitude, and designing a practical budget that is worth sticking to.

First of all, you'll need to take an accurate look at your financial situation. Ignoring the balances on your credit cards-paying only the minimum each month-while racking up more credit card debt will not help you walk on the path to financial freedom.

♦ "Prescription for Your Financial Health"
To get started in the right direction, let's discuss a "Prescription for Your Financial Health." To restore your financial health, we'll need to do the inner work of changing the way you think and feel about money and also the outer work of practical money management. As mentioned in the previous section, the way you think about money is a strong force in shaping your spending and saving habits, and also your overall state of mind.

If you constantly worry about your debt or how you'll be able to pay all of your bills, these thoughts may begin to add enormous amounts of stress to your life. Instead of thinking, "I'll never be able to get out from under this huge mountain of debt," take a practical step, like increasing your monthly payment on your high-interest rate credit card, and start thinking, "This is manageable when I take the right course of action."

It is also necessary to uncover what thoughts and beliefs you have about money. You may not be aware of some of your attitudes toward money, but they present themselves in various forms throughout your day. When a woman driving a Jaguar pulls up next to you at a stoplight, do you initially think, "Her husband must have a lot of money," not thinking that a woman could become wealthy on her own? Would such a hidden attitude prevent you, as a woman, from taking control of your own financial situation and accumulating your own wealth?

♦ 3 Techniques to Regain Control Over Finances

Technique # 1 - Uncovering Hidden Thoughts and Attitudes About Money
Let's explore how you feel about money by finishing the following statements. Write your answers down. There are no "right" or "wrong" answers. Just be honest.

Money is…
My bank account is…
Those who have more money than me are…
Money never…
Money always…
When it comes to debt, I believe…
When it comes to money management, I am…
I can't make a lot of money because…
I deserve…

What thoughts about money have you revealed? Start replacing your old beliefs with positive, wealth-enhancing ones. For example, instead of saying, "I must work hard to make a lot of money," say, "I make money by working smart." Instead of telling yourself, "I can never really be debt free," say, "I enjoy the freedom of living debt free."

Your thoughts are powerful, and what you choose to focus on will shape the decisions that you make regarding your spending and saving habits. Instead of dwelling on the things that you don't have (a brand new BMW, a vacation home in the Florida Keys), think about what you DO have, and be grateful for it. An attitude of gratitude will help you see your financial situation as something that isn't overwhelming and burdensome.

♦ Technique #2 - Developing an Attitude of Gratitude
To keep your mind on thoughts of gratitude, let's try this exercise.

#1: List five things that you're grateful for, like your new puppy, your full-time job with health insurance, and being able to spend time with your friends after work. These things can be money-related, but they don't have to be. Just write down five things that you're thankful for.

#2: Now, take this list and post it somewhere in your home, office, or car where you will be reminded of the blessing of these things. Add to this list daily. When you are continually reminded of how much you have in your life, tangibly and intangibly, such as through relationships and love, you will find your old ways of thinking about life and money begin to shift.

#3: As you start to think about the abundance of things in your life, now would be a good time to eliminate any unnecessary expenses. In order to do this, think about the things that truly make you happy. Would you rather go out for lunch every day or bring your lunch to work three or four days out of the week?

What's more important to you: spending ten dollars every day on lunch, or splurging once a week on a nice meal out with a few of your closest friends? How about saving that money and having an inexpensive home-cooked meal with those friends instead? It's the quality of the experience that should matter, not the quantity.

♦ Technique #3 - Designing a Practical Budget Worth Sticking To
After deciding what brings you happiness (getting out of the office each day for lunch or saving up money to dine out with friends), now would be a good time to look at your overall spending habits and create a detailed budget.

a. Start by listing your total monthly income (after taxes).

b. Then list your monthly expenses, such as rent/mortgage, utilities, insurance, groceries, entertainment (this includes dining out), loan payments, clothing, and other such expenditures.

c. Subtract the total of your monthly expenses from your monthly income and analyze the amount that's left.

What can you put into savings? Should some of this "leftover" money go toward your loan or credit card payments? Do you need to cut back on entertainment in order to put more into your "grocery" section? Should you cut back so that you can save more?

Remember that it is important to save all you can. Money saved is not simply money idling in the bank. It is money that is set aside to be there when you need it for unexpected emergencies, such as home or car repairs or medical expenses.

Regardless of what you decide with this budget, the important thing is that you stick to it. Don't get into the habit of thinking that if you ignore your credit card debt or the amount you're spending on entertainment each month that your problem will go away or resolve itself. You must be proactive in finding your solution to your financial stress. This begins with recognizing your hidden beliefs and attitudes toward spending and saving, creating a budget, and sticking to the plan that you've created.

In this section, we discussed the influence of post-holiday stress as it relates to over-spending and financial burdens-The Money Trap. We also discussed the importance of creating a practical financial plan that helps get you out of the money trap and on the path to financial stability.

In the next section, we will discuss what fuels you.

Peer-Reviewed Journal Article References:
Lay, A., & Furnham, A. (2019). A new money attitudes questionnaire. European Journal of Psychological Assessment, 35(6), 813–822.

Lazar, C. M., Black, A. C., McMahon, T. J., Rosenheck, R. A., Ries, R., Ames, D., & Rosen, M. I. (2016). All-data approach to assessing financial capability in people with psychiatric disabilities. Psychological Assessment, 28(4), 362–371.

Tocci, M. C., Converse, P. D., & Moon, N. A. (2020). Core self-evaluations over time: Predicting within-person variability. Journal of Individual Differences, 41(1), 1–7. 

Troy, A. S., Saquib, S., Thal, J., & Ciuk, D. J. (2019). The regulation of negative and positive affect in response to daily stressors. Emotion, 19(5), 751–763.

Quinn, M. E., & Joormann, J. (2015). Control when it counts: Change in executive control under stress predicts depression symptoms. Emotion, 15(4), 522–530. 

Wrosch, C., Heckhausen, J., & Lachman, M. E. (2000). Primary and secondary control strategies for managing health and financial stress across adulthood. Psychology and Aging, 15(3), 387–399. 

What will shape the decisions that you make regarding your spending and saving habits? To select and enter your answer go to Test.

Section 12
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