b&b 211: Back to Basics – Your Money Personality
In this week’s episode we are going to go back to basics. We want to update the concepts, because our understandings of these concepts have evolved. We wanted to start with show #1: What is Your Money Personality?
Pam: The reason why we think it’s important to start with money personalities the thing about really digging into your relationship with money is that this is where all of the work begins. We are never asked to examine what our relationship with money is despite the fact that we start developing a relationship with money as young as five or six and maybe even younger than that.
Dyalekt: We pared it down to four personalities and we have given them names that we think tend to fit the tendencies that people have. These things are tendencies because they are not the totality of your being.
Pam: We are not saying that you need to change your money personalities or even that you are just one of them. We all have a little bit of each of them in all of us. What is nice about knowing what your predominant tendency is, is that you are able to filter financial advice through it in a way that isn’t punitive. Financial advice is really varied and sometimes contradicts itself because Not everything works for everyone.
Pam: The thing about complicators is, we stress out about money to the point where everything feels like a priority and it feels like we have to address everything at once. We tend to be the victims of analysis paralysis.
Dyalekt: There are studies that show that we have a relationship with money and our experience as educators has shown that to be as low as even six. These aren’t necessarily abstract, arbitrary things and are sometimes trauma that inform our future decisions.
Pam: For the complicator it’s about letting go of some control or some idea of control that you have so that you do actually feel more in control.
Dyalekt: When you allow other people, creditors and what not, to set the priorities for your finances you are not in control and you are not able to make choices that are the best for you in each instance. You will make the best available choice.
Pam: Especially for contemplators its important to understand that the priority doesn’t have to be the thing that is knocking down your door the most or the thing that you feel is going to give you that temporary relief.
Dyalekt: Contemplators need to find a way to automate things, specifically your bill payments. No matter what happens, it will take care of the minimum part and you are not having to worry about fees.
Pam: Also, with contemplators, they do have a threshold unlike contemplators for how long they can actually think and talk about money. So, if the idea of changing all of your bill payments to automatic payments in one day feels overwhelming, choose one or two bills that is really easy to automate right now.
Pam: The paper chaser’s solution to their money problems is ‘I will just make more money and it will solve all my problems’. Because they’re good at planning for the short term, they’re good at saying ok this next check is coming or ok if I just get this next gig I can just pay for this bills, cover this credit card debt, finally put money in savings. They’re always planning one or two steps ahead. What happens when you are planning on income that may or may not have come in yet is that it makes it hard to save. Paper chasers are so good at making money but not saving money.
Pam: One thing that’s great about paper chasers is that they tend to have an instinct in terms of how to make money and what it takes to really generate income. And that’s great and I think that one thing for paper chasers, knowing that it is difficult for you to save and you may potentially be in an income situation where the income is variable or the income isn’t consistent is to prioritize savings and to also think of saving as another source of income. You have to make a plan and kind of understand that it will be difficult to stick to it.
Dyalekt: Money monks don’t think that money is the root of all evil. We don’t think of it as ‘our’ money we think of it as ‘the’ money and we are responsible for where it goes next. Cash needs to flow, and for our lives to be better everyone’s lives needs to be better. When we have a lot of money, we’re generous and we don’t have a lot of money, we’re generous. We tend to put excess responsibilities on ourselves.
Pam: I know a lot of money people who actually are money monks who take this quiz think they are something else but it doesn’t quite resonate with them and when you dig into to how they actually feel about money and their relationship with it you realize that they have morphed into these different money personalities because of circumstances in their lives because they’re money monk.
Dyalekt: There is something about the level of respect that you get when you ask for your rate. Its difficult because you feel like you’re cocky you feel like you’re being too much or you’re doing something detrimental to the thing that you love by asking for the thing that you need. When you are negotiating a raise, when you are talking about a salary, when you are determining a rate for your services or goods you created always make sure you ask for a competitive rate.
Pam: I feel like the conversation always turns to how do you make sure that you are getting paid what you’re worth and knowing what your tendencies are? When it comes to setting your rate the very first thing to do is to come up with a standard rate. this is the rate that I am comfortable being uncomfortable with. It feels like its too much it would be amazing if someone said yes to this, but you don’t think anyone is going to say yes to this. That is what your standard rate should be. Then from there that’s where you start negotiating.
Dyalekt: I want to be real with y’all, this is way easier said than done. Not just for money monks, but for all of the money personalities. All of these things in abstract, seem like a very simple solve and it seems like if you just start working on them they will eventually go away. There are certain things that we don’t end up getting over and it’s fine if you don’t end up getting over these money personality traumas and tendencies.
Pam: The goal is not getting over them. It is to recognize that they exist and to figure out what tools and what strategies you can use to work with your tendencies. This is why we think it is so important to start with the money personalities. If you have an understanding of where the tendencies come from, that leads you to the point where you were like, ‘oh, that didn’t work for me’. Then you can actually go back and say, ‘ok, now that I know this about myself what can I try instead? What can I do next?’.