“She sees savings and her level of savings as a symbol of her success”
The Grid: Caroline, you talk about how our beliefs impact our relationship with money. Could you tell us more about the psychology of spending, saving, investing, etc?
Caroline Domanska: Ever since we became aware of money we’ve created beliefs around them. Beliefs that are sometimes positive but, in my experience, are often negative and often come with a bit of a dose of money shame unfortunately. We hold limiting beliefs, such as money is the root of all evil or it’s greedy to want more money or you have to work far too hard to be successful and I would have to give up too many things.
Our money stories intertwine into our business and personal life and when we explore our money stories that is when we get the opportunity to see how they are playing out. And sometimes it can be very strange connections before you realize them.
Let me illustrate this with a story about Frances. Now, Frances has been in a relationship with money since age eight when she first received her pocket money. She’s one of four children, the oldest, in fact. And all of them receive pocket money for the usual sort of things so doing your chores, making sure that your bedroom was tidy, making sure you’ve done your homework on time.
Now, they got their money on a weekly basis and her father kept it up high in a cupboard they couldn’t reach. So, when it was pocket money time, he got up to the cupboard and he’d bring down the locked red box. Out from the box would come the book. The book recorded the receipt of your pocket money. Now, they’ve got quite competitive actually, her and her siblings because they had the opportunity to earn extra money doing extra chores and things like that. So, there was always a little bit of rivalry around who was going to get the most payout that week.
To this day, Frances still records her income and expenditure. She still feels that money should be protected in some way and somehow be kept slightly out of her arms reach. She sees savings and her level of savings as a symbol of her success and how well she’s done in life.
Now you might say, hearing all of that, you just might think actually that sound pretty good for Frances. Sounds like all those sorts of things have done her quite well in life. And they do. She’s got a good salary, good job. She’s also got a great rainy day fund. In fact, her rainy day fund is so large she could probably out-weather a hurricane, a storm and whatever other force ten gales would come along. She’s also saving quite well for her retirement that is a long way off and it’s looking pretty good for her.
The Grid: But there is a flip side?
Caroline Domanska: Yes, it sounds like a pretty good situation, but on a flip side of that, she lacks spontaneity in life. She rarely takes opportunities.
She doesn’t treat herself.
She lives in a mindset of scarcity.
She’d love to start a new business.
She’s got great ideas. In fact, she’s got the money to do it. But she doesn’t because she comes from a mindset of protectively and making sure that savings are there rather than spending.
This is an extract from an interview with Caroline Domanska, Founder of Money Mindset Coaching.
Interview by May Khizam, Founder & Chief Strategist, The Grid Media Ltd
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