Money Baggage and Finances

Our money baggage affects our financial life more directly than any other area. One dramatic story that illustrates this is that of Paul, a real estate investor. His experience in childhood led to millions of dollars in losses and also to alcoholism, drug abuse, and broken marriages.

As a child, Paul’s dad rarely spoke to him or spent much time with him. In Paul’s eyes his dad was powerful, large, and remote. When Paul was five years old, his dad gave him money to go to the corner store for a quart of milk. He never remembered his dad trusting him before, especially with money. To Paul this was a chance to shine in his dad’s eyes. He felt he was setting out on the most important mission of his life.

Paul bought the milk, got the change, and set off at a run for home. On the way back he got distracted by an anthill, and played around a small creek tossing in a few rocks. When he got home, he proudly gave the milk to his dad. His dad, barely looking up from the TV, asked him for the change. Paul dug in his front pocket, but the change was gone. He searched his other pockets to no avail and a wave of panic set in.

His dad got angry and asked him if he had hidden the money for himself. Paul denied it and started to get “real scared.” His dad made him go back to the store and look for the change. He spent the next hour, almost paralyzed by fear, retracing his steps to and from the store, but found nothing.

He felt like a failure, and was sick to his stomach when he admitted defeat to his dad. Paul remembers to this day how angry his dad got, glaring at him, his lips drawn together. Without a word, he walked out of the room leaving Paul alone, and didn’t speak to him for the rest of the day. His dad never trusted him with money again.

At the workshop thirty-six years later, Paul identified his money baggage for the first time: “No matter what happens, I’m just going to lose it anyway.”

Even by age seven Paul had become a hard worker and habitual spender, and had his own bank account. When it got up to eight dollars, he withdrew it and had an older kid buy cigarettes with it.

He remembers buying school lunches in high school for his friends so he wouldn’t have to keep money in his pocket, all the while not consciously remembering the event of losing the milk money or being aware of why he felt compelled to spend everything he got. He became student body president and an all-star football player, but slowly grew apathetic. Deep down he felt he was a failure. “So what does a failure do?” he asked himself. “A failure screws up.” He often found himself without two cents to his name. Any time he had some success, he knew it wouldn’t last.

He had a naturally entrepreneurial nature and made a lot of money, but he spent it on partying. He started drinking a lot and became an alcoholic. He got into real estate and made a ton of money. Then he’d take two or three years off, living “the good life.” Tropical islands, large yachts, villas, wine, women, and song. He could never accumulate anything. He had to spend it all.

He got divorced twice and never formed lasting friendships. Who would want to be friends with such a failure? He was foreclosed on three times and went bankrupt twice. Millions of dollars “went through my pockets,” as he put it.

You might read Paul’s story and say, how silly. How silly that a simple little event in childhood like losing money on the way back from the store can so influence a life. Well, our money baggage is often silly—from an adult point of view. But it is not the adult who is in charge of issues with money; it is the child-mind in action inside the adult. A child’s mind is extremely impressionable; it believes things with great conviction, and it never forgets.

This single event of buying some milk and then losing the change crystallized, in Paul’s young mind, a deep belief about himself, and it was backed up by many years of experience. His conclusion that he was a failure arose from his decision that he did not live up to his father’s expectations. In a similar way, we form our internal stories (No matter what happens, I’m just going to lose it anyway.) and then externalize them to make our stories come true in the world.

Some people worry about money a lot. Even when they have plenty, or have the promise of plenty in the future, they never feel they have enough. If they do have enough, they spend it. By spending it, they perpetuate the feeling of not having enough. Other people sabotage their own dreams just as they begin to succeed, because they believe so deeply and unconsciously that success would ruin their life. This becomes their money baggage. They will talk a lot about wanting to succeed and sincerely try to make it come true, but as long as their money baggage is in charge, success will be fleeting.

This entire mechanism occurs automatically. People don’t do these things on purpose. They are not aware of why they go on spending sprees, running up large credit card debts, or why they can’t earn more than they do, or why they constantly bounce checks.

Some people use “retail therapy” to avoid their painful issues around money. By spending, they distract themselves from having to investigate this pain. I see other people who cannot spend money on themselves because they don’t believe they are worthy.

Look to your behaviors around money and your current financial situation. Don’t assume these behaviors and the state of your finances are normal and just “the way it is.” Question them. Ask yourself why you do the things you do in your life with money. Do you hoard it? Do you find yourself in constant debt? Are you unable to set clear limits for your children when it comes to spending? Are you always thinking you need more? Do you neglect yourself—wear second-hand clothes and never get around to treating yourself with something nice?

By answering these questions you will get below the surface of your habitual thoughts about money and to the root cause of your behaviors. By understanding the cause you can begin to take steps to create new thoughts to better shape your life and your relationship to money, especially when it comes to your personal finances.

Next week we discuss how Money Baggage can affect your family life. Thanks for reading and following!


Money Baggage and Work (Part 2)

Our money baggage not only keeps us from pursuing work we love; it also can keep us in lower-paying jobs than we deserve. Virginia, one of my clients, runs the information technology department at a state agency.

Virginia is exceptional at her job. She keeps up with the latest technological advancements and she is constantly expected to do miraculous things with few resources. On call twenty-four hours a day, she is the one who has to fix things if the system crashes or malfunctions. She only gets called when there is a problem—and when there is, it always needs to be fixed right away. She has worked at the agency for twenty-one years. In six more years she can retire. But the job is wearing her out.

One irony about her situation is that she works within driving distance of many software companies starved for skilled workers. Often she trains someone who then gets hired away at a starting salary far exceeding hers. She could easily triple her income and work shorter hours at a private company.

I told her, “Quit! Get out! Who cares?” Based on the retirement projection for her and her husband (who makes pretty good money as a mid-level bank manager), she really doesn’t need to make a lot of money, maybe $40,000 a year. “Do you know how many jobs there are in the world paying $40,000–$50,000 that you are completely qualified for? Even if you didn’t have the right skills, you could get them in a relatively short time.” The more I asked her why she stayed and why she didn’t go get another job, the more she fidgeted in her seat.

My logic fell on deaf ears because her money baggage is: I can’t risk—the world can’t be trusted. Her father was an entrepreneur who made lots of money but went broke again and again. The family was always in upheaval. “It’s our lot in life, honey,” her mom would say.

To Virginia, taking a risk in her life called up the uncertainty of her childhood, going from boom to bust and back again. Despite all the possibilities before her, she loved the security of her current job and she was unwilling to go beyond her comfort zone. Her money baggage told her that if she took risks, she’d probably get hurt. She would rather suffer than explore the options available to her.

But she couldn’t realize any of this until she uncovered her money baggage. Then it became clear to her why she was clinging to a painful dead-end job.

The world is full of talented people working at jobs below their abilities. They stay in professions that don’t pay very much money or that they don’t like. They believe that staying safe is better than leaving, even if staying is painful.

I don’t believe our souls buy into this idea that stagnation is a safe place. I think our soul wants us to grow. I believe our soul wants us to find our own unique gift. To find work that expresses who we really are, what our true passions are.

Ask yourself if you love your job. If you don’t love it, why are you still doing it? Why aren’t you moving on? Do you deserve a raise or more time off and are afraid to ask for it? Do you tell yourself that the reason you work so hard is that you have to support your family? Do you take lunch breaks? Do you take all the vacation time you have earned? The answers to these questions are pointing you toward your money baggage.

It might be useful to list every job you’ve ever had and see if you can find a recurring theme. Were you following your deepest interests and your heart? Were you paid what you were worth? What types of bosses did you have? Take this information and use it to better understand your money baggage, and become more conscious of its influence in your life, especially at work.

Tune in next week as we explore Money Baggage and Finances!