The Psychology of Money

If there is one thing that my new business is teaching me, it is that there is a POWERFUL psychological connection between people and money.  This is a huge hurdle for me to get over.  I am beginning to think that the majority of people need not only a financial planner but a money psychologist.  I think the package deal would really be the best approach to people righting their money ship. 

What types of irrational approaches do folks have? Generally, they divide into a few categories, what Olivia Mellan, a Washington, D.C.-based psychologist, in her book Money Harmony: Resolving Money Conflicts in Your Life and Your Relationships (1994, Walker & Co.), calls “hoarders,” those who can’t part with their money; “spenders” (just what it sounds like); “amassers,” those who create wealth for the sake of it; and “monks,” those that regard money as evil.

 These “financial personality types” all have to do with how we were raised, our past experiences with money.  But the real question is, how do we deal with this so we can thrive financially?

I think a great first step in the process is to answer the following questions:

What are the uses of your money that have made a significant positive impact in your life?

What are the uses of your money that have added little quality to your life?

What are the uses  of your money that will affect your life positively a decade or more from now?

What are the uses  of your money that will affect your life negatively a decade or more from now?

Once you answer the questions.  Try to redirect your money to those things that will affect your life positively.

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One Response to “The Psychology of Money”

  1. Know Thyself - What is Your Money Personality Types « Dollars & Sense Education Says:

    […] November 8th, 2007 — Nicole McInerney I have written a couple articles such as this one and this one on the psychology of money.  There is the MBA finance chick side of me who looks at sheer […]


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