This is the first entry in a series of articles about how our financial stories affect our financial choices. 

Sigmund Freud believed that the human psyche draws a parallel between money and feces. He was Freud, after all; some things are to be expected. While Freud’s interpretation may strike some as odd, the idea that we have some cultural or subconscious metaphors for money is not the least bit strange. Nearly every money message we encounter has within it some tone of good or evil, sacred or profane, and taking stock of which messages we have come to believe, and the moral tenor they imply, can bring us a long way toward understanding why we behave the way we do with our own money.

We don’t talk about money.

In our culture, we don’t discuss salaries or financial stress with anything that resembles openness or candor. Sure, we hear people say things like, “I’m broke,” but rarely will anyone admit to losing sleep over money problems (62% of Americans do). We understand well that to talk openly about our financial life is to invite judgment, and so we hold our financial cards close.

We talk about money all the time.

 Used under licence
Source: Goddard: Used under licence

We may not get specific, but we actually talk about money constantly. Certainly not with words, but we talk about money through our clothes, our cars, our homes and neighborhoods. We talk about it with our jobs, our hobbies, where we shop (or don’t) where we dine (or don’t), and even through how we hold ourselves and the accents that we adopt (or don’t). We are constantly sending one another signals about our economic status through thousands of little social cues. True, we don’t talk about money, but we are surrounded by money messages nearly every day of our lives. The stories about money that we tell each other have a profound effect on the core beliefs that we each develop with respect to money.

Types of Money Messages

Money messages are in our cultural stories, song lyrics, proverbs, fables, and pithy words of wisdom. They drop from the mouths of our parents and grandparents, and pepper the rhetoric of political candidates.

Money messages tend to fall into three broad categories.

Proverbs - First, there are the words of wisdom that we hear again and again in the form of proverbs or common sayings. I think of these stories as messages about money disguised as advice about life.

Money doesn’t grow on trees.

Money makes the world go ‘round.

Money is the root of all evil.

Money can’t buy me love.

A penny saved is a penny earned.

Mo’ money, mo’ problems.

This is the most obvious kind of money message, and the easiest to spot. You may be able to add to the list with a few that your parents, grandparents, or teachers said to you. They may seem silly or inconsequential, but these pithy little nuggets often have a powerful effect in shaping our core beliefs.

These messages are fairly simple to separate into the categories of “Money is good,” and “Money is bad,” because they are clear, verbal representations of moral judgments on money. Some may have mixed ethical implications such as “Money is power,” which could be good or bad, depending on your feelings about power. Still, most often when I hear people say this, it is a part of a larger statement that goes some- thing like, “Money is power, and power corrupts. Therefore, money corrupts.” According to this view, money is like the Ring of Mordor in J.R.R. Tolkien’s famous novels, threatening to destroy the hearts of any who hold onto it too long because of the power that it affords its owner. Again, the moral lesson in the money message is clear.

Characters - A second type of money message is more subtle. These can take the form of stories with caricatures depicting the wealthy as sickening, black-hearted pigs with no humanity, while the poor are drawn as glorious models of virtue.

Michelle Paccione/Shuttestock Used with permission
Source: Michelle Paccione/Shuttestock Used with permission

While these stories and characters have some very positive lessons to teach, they can also have a poisonous effect if we are not careful to guard ourselves against the influence of the stereotypes that they paint. We should all take to heart the warnings against becoming dispassionate toward our fellows, and keep our hearts unsullied by greed, but these stories are often incredibly simplistic in their depictions of the heroes and villains. It is easy to paint all wealthy men as Ebenezer Scrooges and all poor boys as Charlie Buckets; however, in doing so we not only reduce human beings to caricatures, but we also risk sabotaging our own financial well-being. When we equate wealth with greed, and poverty with goodness, we can unwittingly start to believe that the only way to be a good person and still have wealth is to be granted a gift of Fate like these characters were.

Social Cues – Lastly, we have all the myriad social messages that tell us what having money (or not having money) means about who we are and what we can or cannot do in the world. Marketing campaigns are artful at telling stories of how money can buy us love, friendship, popularity, respect, beauty, power, fun, safety, and everything else a heart could desire. As social animals, we need the security of our tribe to feel fulfilled and safe, so we are often careful to make sure that we have all the proper markings of that tribe. These markings may be in the form of educational status, neighborhood, home size, car brand, clothing style or brands, speech, or anything else, but they all communicate belonging to a certain socio-economic class or tribe.

Kaspars Grinvalds/Shutterstock Used with permission
Source: Kaspars Grinvalds/Shutterstock Used with permission

Not only can social norms lead to overspending and debt as people attempt to fit in with their peers through material means, but social pressure can keep people from achieving their life goals. Kids who leave their low-income neighborhoods behind to pursue higher education or better job prospects often pay a high social cost. Many bright young scholars who leave the projects to attend prestigious colleges find themselves feeling isolated and alone. Coming from a different background, they often don’t fit in at their new school, and when they go home they can find themselves ostracized for “forgetting their roots.” The threat of being rejected for trying to get ahead financially can lead some people to decide that it is better to live in poverty among friends than to be financially successful, but alone.”

Money Messages and Financial Behavior

As we grow and mature, the money messages we are exposed to combine with our experiences to create a personal, evidence-based narrative about money. For some of us, there are critical, defining moments that instill within us certain financial beliefs. For others, our narratives grow slowly and imperceptibly as we age. We all have a narrative, but often we don’t realize what it is until we are asked to articulate it.

Your Financial Narrative – If you really want to make changes in your financial life, the place to start is by examining your own financial stories. Set aside 15 minutes today to do this exercise, and then check back for more on how to work with your story and change your narrative to better serve your needs.

Think about your life and experiences with money from childhood until now. Then, using the following questions as prompts, write out your own financial story.

  • Who have been the most influential people in your life when it comes to money? What are their attitudes about money? Do they see it as good or bad?
  • If money was a character in your life’s story, would it be a friend or an enemy? Why?
  • When did you begin to recognize class differences in society? Did they affect you personally?
  • How did you feel about money as a child? How do you feel about your finances now?
  • Lastly, once your story is written, try to sum up the theme or ‘moral of the story’ by completing the sentence, “In my life, money is……..”

The simple act of writing your financial narrative can bring clarity and insight. Feel free to comment or ask questions below, and check back next week for tips on how to start changing your financial story. 

Sarah Newcomb is a behavioral economist at Morningstar, and author of the book LOADED, Money, psychology and how to get ahead with out leaving your values behind.

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