|
|
|
|
| The Basics | 5 steps to break through your Money Block
|
If youre using every trick to avoid balancing your spending with your income, you have a case of Money Block. Its tough to fight, but heres how to do it.
By MP Dunleavey
Editor's note: Columnist MP Dunleavey and six other women have come together online to strip away the myths surrounding money, lay bare their assets and liberate themselves from debt. Follow the quest for financial fabulousness of these "Women in Red" every second Monday in Dunleavey's column on MSN Money.
Carole is caught in a financial Catch-22: She likes to spend freely yet suffers from a nearly constant fear of not having enough.
Her comfortable six-figure salary allows her to go out with friends and take cabs as needed -- and she recently shelled out $1,500 for six month's worth of sessions with a personal trainer as part of her new get-fit regimen. She's the only person I know who won't balance her checkbook . . . because she doesn't really have to.
"When the number of twenties in my wallet runs low, I go to the ATM," she admits.
All this would lead you to believe that Carole is a millionaire, and we should all go live at her house. In reality, though, she realizes she needs to rein in her spending so she can save for a more secure financial future. Yet, she's afraid to look at where her money goes. "I'm afraid of the spending patterns I'll see."
The four symptoms of Money Block
Like a lot of women, Carole, 38, is a victim of Money Block.
You've encountered Money Block before, although you probably called it something else (laziness, procrastination, fear of math). The symptoms include:
- Ignoring that personal finance book on your night table.
- Averting your tender eyes from the nitty-gritty of your financial statements.
- Finding creative ways to avoid talking about money with your spouse.
- Buying money software, using it for two days and then quitting.
Most people are resistant to change: Starting an exercise program, quitting smoking, going on a diet. But nothing is harder to cure than a case of Money Block.
Wanna know why? Because everyone wants managing money to be as easy as baking cookies. Which it could be except for one teensy factor. No one has mixed emotions about cookies -- aside from high-carb guilt. Money, on the other hand, is fraught with desire, panic, ego, fear, indulgence, vanity, power, success and failure.
So many things can get in the way
Witness what some of the Gals in Red have been struggling with:
Anna, 40, has known for months that she and her husband need to talk about money. Hes mired in debt, and theyre expecting their first child. But, as pressing as these priorities have been, "I didn't want to rock the boat," she admits. Even when some creditors started calling, even when the phone got shut off (briefly) because the payment was late, "It was hard for me to bring up the bigger picture conversation."
Brice, 37, the other resident free-lancer, has had a very hard summer. She lost several assignments and has about one month of living expenses left at this point (and some checks on the horizon). Despite the fact that she should be in belt-tightening mode, her Money Block kicked in. She went shopping. "It wasn't even stuff I needed," she admits.
As for me, I keep saying I want to figure out how to invest my retirement savings. But then my resistance storms in: I read the L.L. Bean Home catalog, tell myself I have far too much work to do or try to micromanage my husband's career. (No joke, Chase bank has called me six times BEGGING me to invest my SEP-IRA, which is languishing in a money market account earning 0.0001% interest.)
Youre most susceptible when youre making progress
That's not to say that people are unwilling to change their financial ways. Noooooo. Everyone in the group has been working with extraordinary energy and effort to tackle their problems. I'm impressed. This stuff is hard, and I keep waiting for people to quit -- but they don't.
Carole, for example, actually did keep a spending diary for a few days. It wasn't pleasant, but it was her first eye-opener that, yep, the spending has gotta change (and, in fact, she has put her expensive vacation on hold).
Anna is starting to talk more frankly to her husband about his role in their finances; she may even bring up the idea that he could be a stay-at-home dad so they can save on pricey Washington, D.C., daycare. And Brice is negotiating hard for a new freelance deal that could turn her finances around.
Nor is this a case of money demons impeding people's financial progress. Money Block develops after the progress starts. It's when you have a little momentum -- and you're feeling that first flash of "Phew! I can do this!" -- that you stall. Grrrrrrrr.
5 steps toward beating Money Block
Figure out where you're stuck. The sneaky thing about Money Block is that you may not even know you have it. "HEY I'M TRYING TO MOVE FORWARD HERE," you may scream, not noticing that your back wheels are 12 inches deep in muck. Brent Neiser, a program director with the National Endowment for Financial Education, suggests doing a diagnostic.
Write down a goal you're working toward and the steps you're supposed to take to get there. "If those changes aren't happening, ask why you're not taking the necessary steps," says Neiser. Then . . .
Look at the surrounding emotions. Why is Carole, the successful director of a New York not-for-profit, reluctant to look at her spending? "At work I'm anal about all our accounts," she says. "I balance them down to the last penny."
Obviously she has the skills. The underlying cause of her Money Block lies in the past, she realized. Money was never an issue when she was a girl, until her father passed away when she was 10. Suddenly her mom had to struggle to provide for her four kids, and Carole vividly remembers how hard that was.
Is it any surprise, then, that what Carole cherishes most now is her freedom from worry? As comfortable as her income is, "I don't want to look at the numbers, because I'm afraid of losing my sense of control."
And yet without looking at the numbers, she can't give herself the security of a well-planned future.
Accept this truth: No pain, no gain. Money Block may exhibit different symptoms in each individual, but the one thing every one of the Women in Red reports: Trying to break through the resistance to make real financial progress . . . sucks. It's harder than it looks and damned uncomfortable.
Good ol' Sigmund Freud made a whole career out of analyzing the powerful human drive to avoid discomfort. Let me sum it up for you: Resistance is futile. Learn to accept flare-ups of fear, dread, nausea, procrastination, self-criticism, shooting pains behind your eyes -- as a natural part of progress.
Know where you're going. Everyone in the group agrees that even when you're focused on your bigger goals, there's a tendency to get lost -- and stuck -- when you don't know what the next step is. If you don't know what your next step is, go back to your goal and decide what your next move should be.
For example, Carole is now reading some articles on budgets and spending plans in order to develop her own. (For two such articles, check Richard Jenkins article A simpler way to save: the 60% solution and Climb out of your financial black hole.) And she is about to install software to help her monitor her cash flow.
She didn't particularly want to do these things. But to get to where she wants to be, she has to take these next steps.
Want progress more than anything. The only person in the group who says she hasn't experienced Money Block is Yalitza. "I feel like I'm ready to tackle these things," she says.
Her secret: desperation. "I have a long, sordid history with money," she admits. "I've f------ things up in the past, so now I'm ready to accept help and advice from other people."
Willingness to change, and the willingness to hang in there even when resistance throws sand in your eyes, is probably the most important key to sustaining that financial momentum.
|
|
|
|
