Financial Independence Starts with Defining Your Relationship to Money
Whether you live from paycheck to paycheck or skimp and save without ever treating yourself, you need to take a good look at the relationship you have with money before you can become financially independent.
We all have a deep-seated attitude towards money: how much we want to make, how to spend it, and how much we need to save for a rainy day. But we also have been exposed to how our parents or other family members handled money. We may remember not having enough money when we were kids. Sometimes you don't realize what might be causing you to react to certain activities having to do with finances.
For example, both my husband and I grew up in families that, today, would be considered middle to lower-middle income. We weren't starving, but there wasn't money for trips to Six Flags or Disneyland.
My mother grew up during the Great Depression. She had a tendency to do absolutely everything on the cheap and require that I do without things my friends had - like store-bought clothing that was in fashion.
Now, I tend to want to hang onto the money I have, and I think I learned a lot from not getting the things of the moment. But I also deny myself things when I could handily afford them.
My husband, on the other hand, is not profligate with money, but I notice that when things get tight and I start talking about eating out less or saving money on entertainment, that is the very moment he discovers ways to continue eating out or buying gadgets. It's like he resents feeling like he did as a kid, when eating out was a big treat for a family of 8.
We have credit card debt that we struggle to get rid of because it seems like we suddenly need to take a trip. Or we visit family but he wants to get a hotel room instead of stay with a family member.
I have come to the point in my life when I don't really need or want more things. He is not acquisitive, but the things he does want are not cheap. So we muddle along.
On the other hand, he has the maximum amount taken out of his paycheck for the 401K. We don't ever see that money, so we don't miss it. As a result, we have a nice nest-egg that we might not have had just through saving money in a bank.
What is your relationship with money? What is in your past that still effects the way you run your finances? You may be surprised that Mom, Dad, or Uncle Russ still reverberates in your head whenever you pay your bills or buy something on Amazon.