“Do I need therapy?” you may ask, “and if so, what type of therapy do I need if I’m struggling with my finances?” Financial therapy is your answer – but perhaps you haven’t heard of it before. Until recently the stodgy world of finance and spreadsheets rarely intersected with the woo-woo world of psychology and mindset. But that time is ending. In the 1990s there began pioneering work to merge psychology around money with financial advice and the financial therapy baby was born.
Do I need therapy question 1: What is financial therapy?
Financial therapy is a personal relationship designed to help bridge the gap between the mathematical advice of financial advisors and the behavioral challenges that people face in implementing that advice.
For most people, it’s not that they don’t know what to do, they just can’t seem to make the actions and habits stick.
Implementing new habits, seeing mindset blocks and re-writing money scripts (those things you tell yourself about money whether they are true or not) are key aspects of financial therapy that you can’t get anywhere else. And they are also the most important contributors to reaching your financial goals.
The father of financial therapy, Rick Kahler, says that when he was doing financial advising, “Only about 20% of clients respond to logic and education.” That’s not a lot! He began to incorporate therapeutic techniques to create the financial therapy model because financial therapy cuts right to the heart of where we get stuck – implementation.
Do I need therapy question 2: “Can’t I just see my financial advisor?”
Financial advisors are not bad people. The services you receive from them may be helpful but they are not going to help you learn to handle your money without guilt or shame. They are not going to help you create new habits and support you when you feel like giving up.
In case you didn’t know, a financial advisor is employed to sell investments and/or insurance products to you. And they get paid more to sell you certain ones and certain types at certain times. Gut punch right? If you think for one moment that there is no conflict of interest there, well… How can someone who is paid to push specific products and investments, no matter how much they claim to like them, really acting in your best interest? They can’t be acting bias-free because their own financial well-being depends on how much they can sell to you.
If you need investment advice, it is possible to find an independent advisor that is not employed by an investment firm and that is what I recommend if you are looking for specific investment advice. As a financial therapist, we discuss a lot about how to be financially successful but I’m not going to recommend specific stocks for you.
Do I need therapy question 3: what happens in financial therapy?
The catalyst for financial freedom is a great, sustainable budget. We use the budgeting process to uncover your inner money struggles.
As we work through the budget creation process we talk about what kinds of money scripts you heard growing up, what financial freedom means to you, and what you think has been holding you back. Different topics arise for different clients as we work through the process and it’s in taking action on the budget, the organizing, looking at bills, savings, setting categories, that you not only see results but we have a chance to really dig deep into what things have been keeping you from success before.
Financial therapy is not a life-long intensive, although I hope we remain life-long friends. The process increases your personal confidence and clarity around your finances in such a way that you will be succeeding on your own – with my support at first, but ultimately – independently.
That is what success with your finances really is. The confidence to know that you can handle whatever life throws at you. The clarity to know just what to do in different situations. The habits to sustain the changes you’ve made and the mindset of abundance to expand your dreams.
Do I need therapy question 4: who is this right for?
I am going to be totally honest with you. I think pretty much everyone can benefit from financial therapy. It is just such a gap in our education and family system – no one talks about money, how to handle it, and how to use it as a tool without creating massive amounts of stress! Not to mention, the things we learn from our family around money mindset that are accidentally more hurtful than helpful!
You will benefit most from financial therapy if you are experiencing one of the following scenarios:
- A recent change in income and/or bills have you really stressed out
- You are not on the same page as your partner/spouse when it comes to finances and you’re tired of all the stress and miscommunication it creates in your relationship
- You are ready to up your financial game but can’t seem to take the actions you think you need to
- Money has always overwhelmed you and you are ready to take back your personal power
- You have a big upcoming life change that you need to prepare for
Do I need therapy question 5: does it work?
There was a study done at Kansas State University that found that couples who were taught a “love and money” class (kind of like what they would get in financial therapy) felt happier and less stressed about money afterward. They even said that they still felt less stressed about money 3 months later!
Imagine feeling like you and your partner are on the same page when it comes to finances. You set goals together, discuss changes, support each other’s dreams, and don’t have to argue over who paid what and when. You’re focused on accomplishing the same thing which just increases the rate at which you get there! And the intimacy high that you get from being aligned with each other?
Do I need therapy question 6: why do I need it?
First, let me start by saying you are not broken. There is nothing wrong with you and you are not alone in your experience. Whether you are partnered, married, or single – financial worries create stress. In fact, according to the American Psychological Association money is the leading cause of stress in America, with 72% of Americans reporting money stress in the last month (this report was done in 2015 so you can imagine how much that has changed and grown. (APA article)
This same report also says that women suffer more from this than men and that the key to overcoming this stress is emotional support. Emotional support helps lower stress and improve outcomes BUT
One in five Americans (21 percent) say they have no one to rely on for emotional support. A similar percentage of Americans (18 percent) say money is a taboo subject in their family and more than one-third (36 percent) say that talking about money makes them uncomfortable.American Psychological Association (emphasis mine)
This is what Financial Therapy is all about. Providing the emotional support you need to help reduce financial and life stress and achieve more of your financial goals. Achieving your financial goals leads to more security and safety – which leads to more peace and less stress and the positive cycle just keeps spinning.
Ok so maybe I do need therapy…but I’m nervous…..
Lord have mercy do I understand that! It’s not like my family grew up discussing money at the dinner table – we did not! I learned this stuff the hard way too. I have spent too much, saved too little, forgotten bills, all kinds of stuff.
The beauty of financial therapy is that you have an opportunity to choose the therapist that is right for you. That’s part of why you are researching right? You want to know more about this topic and who you might connect with. You are already taking a huge step by even asking, “Do I need therapy?”
Most importantly, you should feel a personal connection with your financial therapist! Talking about money can be super tough so you don’t want to be trying to pour your heart out to some stuffed-shirt who sits there with their notepad while you lie on the plastic couch and says things like, “Hm, interesting, so how does that make you feel?”
Meeting with your financial therapist should feel like a coffee date with a good friend you are excited to chat with. You catch up, you talk about what you’ve learned, insights you’ve had, get advice, laugh, joke, and feel completely heard and accepted. Just as you are. That’s the experience I want for you. This way you never again ask, “do I need therapy?” but get excited about our time together and the results you are seeing in your life!
One of my favorite compliments I’ve ever received from a client –
“In talking to you, you offered help, not judgment. You made me feel at ease knowing you gone through tough financial times yourself while managing to make it all work out in the end.”Marie