How you see money, how you act around money, how you feel about money. These are the core elements to Your Money Model. Most of us were not taught a comprehensive money model to use in our lives. Instead, we create a patchwork quilt of beliefs, decisions, lessons, experiences, ideas, misunderstandings, truths and lies about money. This understanding gets sewn together in some crazy pattern with chunks missing, scraps flipped the wrong way up and missed stitches.
This crazy money model quilt becomes the guide, the map from which you interact with and make decisions about your money. No wonder it feels confusing!
You learned lessons growing up – from your parents and grandparents. You saw how money was dealt with (or not) in your household. Perhaps you overheard money conversations or fights. You were taught money lessons directly and indirectly through the actions of your family and those around you.
Here is what Brenda learned:
When Brenda’s was a little girl and she was upset or hurt, her mother gave her some money and told her to “go buy herself something nice”. She would go to the store with her coins or bills and in purchasing “something nice” she would feel good. Over time, Brenda’s money model included a belief that buying things would make her feel better. She continued that model into her adult life and used travel and clothing purchases to soothe her stress and frustrations. This created a frustrating and growing Line of Credit.
Family circumstances and experiences create pieces of your money model. Your perception of a situation, especially through the eyes as a child will create beliefs that carry through to how you deal with your own money in your adult life.
Here is what Rebecca learned:
Rebecca’s Mom shopped on Friday mornings for everything that the family needed, and spent all of the money that was available. She knew that whatever money was left would be spent that night by her husband at the bar, so she made sure that the family was looked after. Watching this as a child, Rebecca learned that she should spend money as soon as it comes in or it would disappear. She took this belief into her adult life. In her business, Rebecca would spend the money that she earned immediately, not realizing that she was making it impossible to accumulate revenue towards larger business investments.
What patches do you have in your Money Model Quilt? Share with us in the comment section below. Understand that there will be pieces that you want to keep and there will be pieces that you are ready to rework into a new pattern. Acknowledge both as you create your new Money Model.
Want to learn more about Money Models and how to create a new one? Join me for The New Paradigm for Personal Wealth. Click Here.
© 2013 www.karencollacutt.com
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Personal finance expert, Karen Collacutt is founder and CEO of Make Friends with Your Money. Karen works with ambitious people who are making good money but are wondering where it all went at the end of the month. She helps her clients to get clear on their money life challenges and opportunities, matching their money to their goals. They build a plan, confidence and peace of mind around their money. Certified Money Coach and Certified Financial Planner, Karen brings over 15 years of finance and business experience to her clients. Coach, speaker, author and change catalyst for those ready to create a positive and empowered money life, Karen delivers a fresh perspective on how to make friends with your money. www.karencollacutt.com.