Which money psychology do you struggle with most?

You make decisions based on a combination of factors – your logic, your intuition, and your emotions. Sometimes it is easy to forget the psychological considerations that come into play when making financial decisions. Emotions drive many decisions in your life whether you are conscious of it or not. Some of you might not want to admit that your emotions can dictate your choices, but emotional issues greatly influence your relationship with money, and then by extension this affects your work, family members, and every area of your life.

When it comes to making decisions involving money, we know you are doing your best to make choices that make the most sense to you at the time based on your own life experiences and your psychological makeup. Some of these influences stem from your childhood, upbringing, and the economic period in which you were raised. All of these things play a role and directly impact how you deal with and manage your money. Some of these factors create a healthy relationship with money and others do not.

Here we will discuss some of the common money psychologies that impact your relationship with money, which ultimately affects your ability to achieve your financial and life goals. This is an important topic to discuss now as we enter the new year and you have most likely set some goals for yourself and your family. We want to address these issues to help you reframe your views on money so you can create long lasting healthy patterns and habits when it comes to your finances. Ultimately, we want you to attain your goals such as getting out of debt, reaching your first $100,000 in investable assets, and having confidence in your retirement plan.

Ashlyn Prom, one of Goodwin Investment Advisory’s Associate Wealth Advisors, highly recommends reading Morgan Housel’s Psychology of Money. She raved,
“one of my favorite takeaways from this book is that ‘no one is crazy,’ as Housel phrased it. By this, he was referring to the fact that we all handle our money differently. We might not agree with the way our neighbor uses money, however that doesn’t make us or them crazy. We spend money, save money, and give money the best way we see fit. Those decisions are often right-brained and might not make exact sense, but people are not spreadsheets and they definitely do not make all their financial decisions on a spreadsheet either (another thing Housel likes to point out). What we do with our money is what we believe is best for ourselves, our loved ones, and our current situation. So there is no need to judge yourself, or someone else, for spending money on something that might not have the greatest ROI or purpose–because in that moment it was the right decision for you. Again, we aren’t spreadsheets.”
Keep this in mind as you read these different money psychologies. There is no need for shame, or guilt, but as you read them, think about which one you struggle with the most and use it as a learning opportunity to grow in that area of weakness. We all struggle in some way or another.

Some common money psychologies you might struggle with–

compulsive buying disorder

Have you ever heard of Shopaholics Anonymous? According to Healthline, “people with this disorder may be addicted to a certain product, such as clothes or jewelry, or may also buy anything from food and beauty products, to stocks or real estate.” This habit of excessive shopping and spending can become a coping mechanism for stress when you are dealing with hardships in your personal life. This habit can be extremely unhealthy and cause distress especially if you are purchasing above your means. Buying things might temporarily make you feel better, but it can have long-term negative effects on your finances and your life goals. One way to help with compulsive spending is to create a budget to zero and stick with it. You can create a sinking fund for bigger purchases you want to save for while creating a line item in your budget for fun spending (create an amount that is within reason and works within your budget and financial goals.)


Have you ever seen the TV show, Hoarders? On the show they help people who struggle with the extreme side of this habit – the inability to get rid of things even though they don’t necessarily need them. If you have a hoarding mentality, many times you stock up on items based on fears of not having enough. Hoarding can be a result of not wanting to spend money due to growing up in a poor environment and maintaining that poverty mindset even once you have become successful. It can also be a result of sentimental connection to stuff after losing a loved one. Hoarding creates unnecessary clutter and chaos in your home. Having a home that is full of too many possessions can negatively impact your living and working space and even your health. One way to deal with the issue of hoarding is to pack up the physical stuff in your home and unpack (pun intended) the emotional burdens you are carrying within. Clutter can be symbolic of your undealt with emotions and grief. Typically hoarders are risk averse when it comes to finances and would benefit from a financial advisor who can help manage their money while assessing the right level of risk for you.


This habit is characterized by the urge to gamble or make bets even when you don’t have the resources to do so. The psychology of this habit stems from craving the emotional high of winning a bet. This can become an addiction and there are support groups to help you with this struggle. One way you could deal with this desire for risk in a healthier way is to choose a riskier investment fund (having a fund helps alleviate some of the risk while allowing you to invest in higher risk investments overall.) Something else that might be helpful is choosing an activity that provides a healthy endorphin high like running and regular exercise, yoga and meditation, eating spicy foods, generosity, solving puzzles, dark chocolate, and laughing.


This habit stems from a fear of not having enough money and as a result you focus on your career at the expense of the people in your life. Some people that work too much do so also because of deep seated issues with their own worth and value – finding their worth in their work. This compulsive disorder can also be associated with anxiety or depression. If you struggle with this disorder you could often justify your focus on work and avoid your friends and family. One way to help with this mentality is to take breaks, and schedule days of rest and vacation. Have someone hold you accountable to make time for yourself and your loved ones. Another way is to donate some of your wealth and time, which will help you to find value in helping others. If you spend time serving with your friends and family together, it is not only a way to be more generous, but you are using your time to build relationships with the important people in your life at the same time.

financial enabling

This money habit is characterized by providing continual financial support to someone while inhibiting them from being responsible for their personal finances. This enables them and creates an unhealthy inability to live without your financial support. It is often seen with a parent-child relationship, but can be seen in other relationship dynamics as well. This propensity is most often associated with feelings of guilt or wanting to be needed. Recognizing your value and worth regardless of your ability to provide financial support is a huge step in overcoming this disorder. Plus, teaching that child or loved one the importance of being able to support oneself is empowering. It reminds me of the quote, “Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.” By providing the financial tools to those you love, you are creating a much better future for them and a healthier relationship with you.

compulsive saving

Compulsive saving is the habit of constantly putting money into a savings account many times at the expense of enjoying your life. This typically stems from finding your security in knowing you have money stored up, but typically having no plan or goal for the money. The difficult thing with this is you create an imbalance and become stressed when spending money, which can create tension in relationships if your partner or spouse has a different money psychology. Creating a balance of enjoying your life and saving while also creating financial goals is ideal and sitting down with a financial advisor is sometimes like meeting with a counselor, because they provide a third party perspective on money in marriage.

financial infidelity

This sounds like cheating. And, well it is, financially speaking. It is hiding your spending from your spouse, or partner. While many of you probably engage in financial transactions of some kind without telling your spouse every detail – it becomes problematic when huge purchases are being made. Then the cheating becomes a debt problem, or where you are constantly hiding money from your partner. All the lying all leads to guilt and distress. This secret spending can be a response to negative feelings and/or hardships in your life. If you are struggling with financial infidelity, try to find the root cause of the issue and seek counseling or other methods of coping with the problems in your life. The first step is to tell the truth and then work towards creating healthier spending habits.

Which of these money psychologies do you struggle with the most? Are there any ways you can change these mindsets which will alter your tendencies which will in turn change your habits. One way to change our tendencies is to use the C.O.R.E. process tool. First, you have to know yourself to lead yourself. The C.O.R.E. process is an acronym C. Call it O. Own it. R. Respond. And E. Execute.

You have to Call out your learning opportunity. Be concrete and specific. What has happened that has exposed an area of needed growth?

Then you Own your tendencies. Explore your Why. Why are you reacting the way that you are? What is the deeper meaning of what is happening in the situation and what is your responsibility? What would you rather see happen?

Respond by creating intentions to address the learning opportunity. What is your intention? What do you need to change to create a healthier life for yourself and others? What does the new behavior look like? Do you need to create a new habit, or a new way of thinking?

Execute a plan with a timeline and action steps for implementing the new response. Clearly explain your plan of action. You will need an accountability partner to hold you accountable to this plan.

By Published On: January 6th, 2022

Share This Story, Choose Your Platform!

About the Author: Tara Bruce

Tara Bruce
Thank you for visiting my author page. Click Here to see my bio!