Your Money Story - How Your History and Experiences Shape Your Views on Money

Your Money Story - How Your History and Experiences Shape Your Views on Money

financial health money story Mar 18, 2021


Do you ever wonder why you look at money so differently compared to your friends, coworkers, or significant other? People come from all sorts of different backgrounds that help shape who they are. Similarly, we all have different money stories shaped by our paths in life.


What’s A Money Story?


Your money story is the blending of your history and your perceptions. Your past experiences with money and unique way of looking at the world come together to tell a story. Your money story is your “why?” that acts as a guide for how you think about money and make financial choices in life.


Your History and Your Money Story


When you think about your history, you probably think about how you grew up and your childhood experiences. You might also think about how your parents and grandparents grew up, the unique stories they had, and the challenges they faced.


Parts of your history to think about that influence your money story:


  • Your Heritage, Culture, and Community - What did the world of money around you look like?
  • Your Childhood Experiences with Money - How did your early childhood experiences make you feel about money?
  • Your Parents and Money - How did your parents handle money? How did they talk about money with you and with each other?
  • Major Life Events - Have there been any events in life that have rocked your financial world?
  • Gender, Race, Traditions, and Other Factors - Are there any other unique parts of your life that have affected your views on money?


Looking at all these different areas through the lens of money, you can see how your unique history shapes your money views now. For instance, maybe you have very similar savings habits as your parents. Or maybe you’ve decided you want to handle saving money in the complete opposite way as your parents. These are both different ways that your money history helps shape your money story.


Your Perceptions and Your Money Story


Your past experiences and family history can have a massive impact on your money story, but so can your current life and perceptions. Every human on the planet has certain ways of looking at the world around them. These perceptions can be warped by something called cognitive bias.


What is Cognitive Bias?


Cognitive biases are shortcuts for your brain to make decisions as easily and quickly as possible. Ideally, this is to make your life easier, but these flaws in every person’s thinking lead them to make choices that may be more harmful than helpful.


For example, the bandwagon effect is a well-known type of cognitive bias. The bandwagon effect means that people are more likely to believe in a cause or follow an idea if there are lots of other people doing it. This type of cognitive bias happens all the time with big-name brands. People buy a particular product or brand because so many other people are using it or posting about it. It influences you to hop on the bandwagon and buy the same product because your friends or other celebrities are buying it, even if you could have found a cheaper or better option for your needs.


How Does Cognitive Bias Influence Your Money Story?


In money, every person has some form of cognitive bias. These biases show up in your life in all sorts of ways. That may be as simple as your habit of hitting a fast-food drive-thru every day to avoiding retirement planning for the fifth year in a row.


Cognitive biases can lead you to form some not-so-great money habits in life. This is because it’s so much easier for your brain to follow the path of least resistance. Like swinging through a drive-thru instead of a grocery store. Again.


To help uncover your own cognitive biases, ask yourself the following questions:


Do I have any habits or behaviors that may not be the best for my financial life? Do I find myself spending money on things I don’t need all the time or putting off important money decisions?


How do I feel when I learn about money topics? Do I inwardly cringe and avoid the topic? Do I only pay attention to the good parts and ignore the hard parts that I really need to learn?


How do I handle money situations when something bad happens? Do I place blame on the situation or circumstances? Do I spend tons of money to feel better?


Learn Your Own Money Story


Take some time today to delve into your own money story. Look at your money history and dig into your own cognitive biases. Start putting together the big picture and get a handle on why you make the money decisions you do. It can be such an empowering experience!


Knowing yourself is the first step to making positive and lasting money changes in your life. And maybe even skipping the drive-thru this week or sitting down to learn about retirement accounts.


Challenge yourself to discuss your money story with your friends and significant others. You may find you have a lot more in common than you thought. Or maybe, you discover a little bit more about the other person’s money story and why they see money the way they do. You may find you better understand yourself and others as you live out your money stories together.


Identifying your money story is one of the core tenets of my coaching practice. It is the largest connection piece whether you are an individual, a couple, or a business. Knowing your money story and identifying cognitive biases gives you the power over your story and to shape the future narrative.

Questions: email [email protected]

Mariah Hudler, MSW, MBA is a financial health consultant, coach, and speaker. She works with couples and entrepreneurs on making their money work for them. 

Disclaimer: This blog is for education only. Please consult with a qualified professional when you have any questions about your personal financial, tax, or legal situation. Information contained in this post is for informational purposes only and not intended to replace professional advice.

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