Saturday, April 7, 2018

The Psychology of Financial Health





I'm at that stage of my life where I've plateaued and I'm looking back to see many of my life's questions/mysteries explained.  Looking into the future is like peering into the void with only death as a certainty.  I sometimes feel extremely lost, something I never thought I'd feel at this age.  I thought by now I would have figured it all out and have done some spectacular things with my life.  Instead I feel very behind. 

When I was growing up I knew we were poor.  From where I stood middle class look like rich, like over-whelming wealth.  I looked at my peers and they had more than me and better stuff than I had. Their clothes were not hand-me-downs or homemade.  Their shoes did not wear until there were holes.  They did not need reduced lunches.  They had the latest toys, watched the popular shows on TV, did stuff after school and on the weekends that didn't involve work.  Everything they had, that they were able to buy, made me feel "less than".  I was regularly taunted for just this.  I was a weird kid anyway but I was also poor, unable to follow the latest fads, unable to participate much with after school activities.


When I was older and obtained my own money, I bought whatever caught my fancy.  I was over-compensating for all I felt I lacked as a child. As an adult I had access to credit which stupidly made me feel like I could spend more freely on the obsession of the day.  [I regret that I'm unable to get back all the money I most foolishly spent on all those needful things.  I wish I could be reimbursed for all those things I bought that I no longer even own!]  Nothing ever fulfilled me for very long.  I would move from one obsession to another to another.

It wasn't just for myself that I was over-compensating.  I made sure my children had all the things their hearts desired - toys, games, clothes, foods/eating out.  None of this was healthy for them or for my family's financial situation.  Even when we were financially strapped it was heard to stop.  It put a strain on the marriage and on our relationship with our children (how do you suddenly say 'no' when you've been a near-constant stream of 'yes'?).  I stayed stressed out over our finances.  I juggled credit card balances until the economic crash of 2008.  Then we just had to bite our nails when the bills came due each month.

Another realization came when we moved.  All that "stuff", all those things "that weren't causing me happiness (after the initial purchase) were literally weighing me down.  So many little knickknacks, keepsakes, collectibles, obsessions had to be packed/unpacked for each move and it was physically wearing me down.  In my mind they became not only a financial but a physical drain.  It was easier to let them go.  It was easier to not buy new unneeded, unnecessary thing to begin with.

My children are older now.  My eldest watched us struggle and in her adult life has avoided credit cards like the plague.  Her only debts are college loans and a car loan.  I'm very happy for her and relieved that at least some good came from my very bad example.  My youngest, who is autistic, has unfortunately grown up able to get most of what he wants.  He doesn't fully understand financial planning and I know that's partially my fault.  If I could talk to my past self, I'd tell her that she's creating a huge problem for her future self and , more importantly, for her son.  I have a lot to work on with him so that he understands.

We were able to correct our financial standing after I finally learned that these things I was surrounding myself with didn't help me, nor did they make me happy after that initial purchase rush.  I stopped eating out as much.  Resisted those impulse purchases.  Made extra money by selling off those now unwanted impulse purchase items.  Learned to say 'no' to the kids and explained why I was saying 'no'.  I began paying down the cards one by one.  Each balance moving closer to zero gave me that same high that I used to get from buying stuff.  Each card that was finally paid off was a super rush.  I'd then double down on the next card and pay it off even faster.  Once they are all paid off, I shifted my focus to building up our savings.



It was hard to change one set of habits for another.  I could only have done it because I reached that plateau in life.  I saw that I couldn't move any further towards my future if I was stuck in my past feeling deprived.  I didn't want to feel deprived again in my old age because I destroyed my financial future due to a ton of debt.

I'm in a better place now.  At least, I'm not lost financially.  We're not rich.  We're middle class, but that is more comfortable than where I came from.  Barring any major disasters, my family should be okay into our golden years.  I'm happy about this.  I just wish I'd learned this lesson when I was my younger.