How to Figure Out Your “Money Script” — And Change the Way You Handle Your Finances

by Emily Guy Birken · 6 comments

Money is a complicated subject because we all have unconscious beliefs about it. Financial planners and psychologists refer to these beliefs as “money scripts.” They’re the stories about money we’ve told ourselves since childhood, and they’re often rooted in how money was viewed in our childhood homes.

Once we know and recognize our money scripts, it’s easier to amend the way we view money, thereby improving our finances. Here’s how:

My Money Script

For instance, one of my personal money scripts is that I don’t deserve money I didn’t earn. When I was the beneficiary of my father’s life insurance policy, I felt like I didn’t have the right to take the money, even though I knew Dad meant for it to be a last gift to me. Since I had done nothing to “earn” the money, it felt out of bounds for me.

Ironically, my money script probably also came from my dad, who always made it clear to me that it’s important to make your own way in the world.

Though it has taken a psychological toll on me, this money script isn’t necessarily detrimental to my finances. In this case, I used the money for things I felt my dad would approve of, like funding my retirement and sons’ college funds, as well as making a large charitable donation. Other money scripts can cause much more self-defeating and self-destructive behavior.

The Four Types of Money Scripts

According to financial psychologists Bradley Klontz and Sonya Britt, money scripts fall into one of four categories: Money Avoidance, Money Worship, Money Status, and Money Vigilance.

My script about not deserving money I didn’t earn can be a type of Money Avoidance. Other common scripts in this category include “Rich people are unethical or evil” or “It’s not okay to have money when others go without.” These scripts are based upon the idea that money is a source of anxiety, fear, or disgust — and that living with less money is a kind of virtue.

Money Worship, on the other hand, is based on the idea that money can lead to happiness and fulfillment. Common scripts in this category include “I’ll be happy if I have more/spend more money” and “You can never be too rich.” If you follow Money Worship scripts, it can lead to things like workaholism, compulsive spending, or hoarding.

Money Status scripts conflate net worth with self-worth. If you have Money Status scripts, you might think “Success is measured by how much money I make” or “My possessions reflect my importance and worth.” Individuals with Money Status scripts will often be vulnerable to debt (because they feel the need to keep up appearances) and get-rich-quick schemes (since they want a shortcut to that feeling of self-worth).

Finally, Money Vigilance scripts tend to be fairly helpful, rather than harmful. Individuals with these scripts will think “Saving for the future is important” and “I have to research all purchases to make certain I get the best deal.” While these scripts can generally help your finances, if taken too far, they can have a negative effect on your psyche.

Relationship with money

How to Combat Harmful Money Scripts

It’s difficult to recognize our money scripts, since they’re unconscious. However, it is important for everyone to examine their relationship with money to find ways to improve it. Anne Kates Smith of Kiplinger reports that journaling can be an excellent way to identify and rewrite harmful money scripts:

“Keep a journal, jotting down thoughts that pop up in any given financial situation. The scripts are there, subconsciously driving behavior. Journaling slows the process, and it captures patterns in your thinking. Once you’re aware of the patterns, you can work on changing them. Say you’ve had a bad day at work and your first impulse is to go shopping. Journaling puts some time between the impulse and the action, allowing you to make a conscious decision to, say, spend time with friends instead.”

Giving yourself the room to examine what you believe about money, and why, can mean the difference between constant self-sabotage and financial (and psychological) security.

For me, once I really looked at my own feelings about my dad’s life insurance policy, I realized that Dad wanted me to enjoy the gift. I plan to use some of the money that’s left on myself — and I’ll know that Dad would be thrilled to see me do so.

Do you know what your money script is? How has it affected your finances?

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  • dee says:

    I’ve never read this before (the idea of money scripts) but it’s actually something i’ve been working on for almost two years. Mine is that spending any money is bad and i have to be frugal all the time. This has resulted in some serious negative consequences, yes, i have alot of savings but what is the point of saving so much if it’s never spent, and worrying about every, single purchase (and i mean everything, i agonise about each thing i buy at the supermarket even) in the meantime? I’m not quite there but i’m trying to recognise this script in my head and dissect it more actively.

  • Kathy says:

    I grew up in a money avoidance home. My mom still practices it today with her mantra “I never aspired to be rich”. I would say that my husband and I are in the money vigilance group. We like money but don’t worship it. And we certainly don’t fit into the money status group. I think perhaps that as you get more money, your group identity changes.

  • Free to Pursue says:

    Very good blog post. Money is psychological on all fronts. We give it a great deal of power over our emotions…until we understand that it’s our perception about money that drives them and not the money itself.

    The “Money Avoidance” script made me think of the story in “Rich Dad, Poor Dad”. Very true that, unfortunately, so many feel that doing well for yourself is somehow shameful. It’s unfortunate. Sometimes success brings about money unexpectedly after toiling for years and it’s a shame some individuals feel so much guilt they can bring themselves to enjoy it.

  • lana says:

    I used to think I didn’t deserve anything good, because my mom was terminally ill at 21 and passed away at 29. She never owned her own home, had medical bills up to her eyeballs and was always trying to juggle bills and needs.

    It took a long time, but slowly my husband and I built a family and net worth. I can see how history can affect the present and future with regards to managing money.

  • M. Catlett says:

    I had, and still have, money avoidance issues too. Haven’t really delved into the details of it within myself, but recognizing it as a driver behind my sprees of buying useless crap has helped me immensely to become more conscious about my consumer behavior. Thanks for the call to action.

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