The psychology of money
How you feel about cash can determine what you do with it
By Cate McQuaid, Globe Correspondent, 06/28/99
First, there is money: cold cash, the long green, the Abe Lincolns. Then, there is the psychology of money: how having it, not having it, putting it to good use, squandering it, or simply being confused by it makes people feel.
It doesn't always make them feel good.
Last month, Joan Luzier had to drag herself to a weekend workshop on money. She knew she would be asked to look at how money makes her feel - and the feeling wasn't good, even though her husband was once a lottery winner. Money came into her life and vanished like steam. She knew, too, that she'd have to examine how money defines her life and how she shapes life according to her finances.
''When it comes to money, my imagination doesn't take me very far,'' says
Luzier, an easygoing medical secretary with a broad, quick smile. ''Since I married eight years ago, my husband has taken over the money. But I lived by myself for 10 years before that. I always had just enough. I'd cringe when I paid the bills.''
She thought her husband wasn't much better at managing the household income. The workshop, she knew, would do her good. ''I'm not very interested in money. I supposed the workshop would show how immature I was,'' Luzier says. ''Go in and grit your teeth and know you'll be told to grow up.''
So she took the workshop with George Kinder, a Cambridge financial planner, Buddhist teacher, and author of ''The Seven Stages of Money Maturity,'' published last month by Delacorte Press. Kinder says that understanding money involves our coping with it, not just our financial plan for it.
''Money is a tremendous power in our emotional lives,'' says Kinder. ''It
makes us frustrated, bored, and angry. There are a lot of emotions around not wanting to deal with it.''
''Understanding what money means to oneself - admiration, guilt,
self-worth - helps you understand how you're using money out there in the world,'' agrees psychologist Dick Geist, president of the Institute for Psychology and Investment in Newton.
The psychology of personal finance is coming out of the closet. Books such as Suze Orman's ''The 9 Steps to Financial Freedom: Practical and Spiritual Steps So You Can Stop Worrying'' and ''The Courage to Be Rich,'' and Maria Nemeth's ''The Energy of Money'' are flying off bookstore shelves. Both authors urge readers to confront their emotions about money and learn to prosper.
Harper's and The New Yorker publish tell-all tales of credit card debt, the troubles of growing up rich, and the struggles of a super-educated writer who, for most of his life, made less than $16,000 each year.
Around the country, people are reading, taking prosperity workshops, attending Debtors Anonymous meetings, and pouring their hearts out to financial planners. Having made it to the Oval Office, sex is old hat. Money may be the last taboo, and there's a movement afoot to break it open.
Luzier took the workshop, based on Kinder's seven stages, because she studies Buddhism with him. Sitting in meditation, she's learned to confront a lot of uncomfortable feelings and self-conceptions she acquired not only from her family but also from society.
She spent the weekend recalling stories from her childhood that shaped her assumptions about money. She identified the feelings the stories brought up and began to recognize how her belief system was skewed.
''There's a structure to suffering,'' explains Kinder, who is also
cofounder of Nazrudin, a think tank of psychologically oriented financial planners. ''It's a glob of uncomfortable feelings attached to a series of beliefs or stories. We practice understanding, let our thoughts go and let our feelings be, and learn to hear the feelings. Then we don't get into that neurotic pattern.''
Luzier's belief was simplistic. ''Money has always been a magical thing to me,'' she says. ''Having it is clean, and not having it is dirty. If we had had money growing up, I imagined our life wouldn't be as chaotic. Money was about order and keeping things clean and neat. But I was never privy to whatever equation brought that about.''
In 1989, Luzier's then-fiance hit pay dirt, winning an $866,000 Megabucks jackpot. ''It made me feel so much more a part of the world, like I had a little bit of luck,'' Luzier recalls. ''For the first time in my life, I felt I wasn't fighting for stuff.'' The relief turned out to be a problem.
''I regressed back into the childlike, magical thinking,'' Luzier laments.
For years, the $43,000 that Megabucks paid annually to the Luziers ($29,000 after taxes) slipped through their fingers. At Kinder's workshop, Luzier really scrutinized where the money was going. ''We literally started putting money aside after the workshop,'' she says. And she realized that nobody has their hands on the magic equation that makes life clean and neat.
Kinder's book - which applies psychological and meditation techniques for understanding your relationship to money - is aimed at both lay readers and financial planners.
''For the last five years, financial planners have come to realize their
profession is closer to that of a pastoral counselor than an accountant,'' suggests Kinder. That's because how you manage your money - and for that matter, the way you make money and manage your career - reflects your beliefs about freedom and integrity.
''Everyone believes a certain amount of money would set them free,''
Kinder says. ''Our aspirations are completely tied up with money. Money has to do with our self-esteem and our identity and how we see ourselves.''
Grappling with self-esteem and aspirations can be painful. Judi Wilson, a voice teacher and performer, faced that struggle after her divorce a few years ago. She started going to Debtors Anonymous meetings, working with a prosperity counselor, and looking at how she felt about money. She also attended Kinder's workshop.
''I was opening up old belief systems. It was like root-canal work. Some
of them are ancestral,'' Wilson says. ''I remember writing, `If I have money, I'll be this cold, hard, narcissistic businessman.' It was one of these myths I have going. I'm changing all my thinking. I'm surprised at how emotional it is.''
Learning to grow up
When Jim came to Debtors Anonymous 10 years ago, ''I didn't know how to earn a living,'' he says, speaking on condition of anonymity. ''I kept asking: `What is the work? The calling?' If I could identify that, everything would fall in line.''
He adds, ''I was avoiding responsibilities. The DA journey has been about growing up, understanding I do have responsibilities and I'm up to them.'' He now does vocational training and job placement for mentally retarded adults.
One key to the approach of both Kinder and Debtors Anonymous is understanding and following the nuts and bolts, the tools, of money management, including developing a spending plan and staying on top of your personal finances.
''When I use these tools,'' Jim adds, ''living within my means becomes a
''Adulthood takes so much work,'' Kinder says. ''But every time you do it
well, you feel more whole and more complete.''
For information about Debtors Anonymous meetings, call 617-728-1426.
This story ran on page C6 of the Boston Globe on 06/28/99. © Copyright 1999 Globe Newspaper Company.