10 Strategies to Transform Your Relationship with Money

Transform Your Relationship with Money

Understanding that positive habits, inner wealth, and good health are important. However, money can be an enabler of well-being or a source of discontentment. According to the research, single parent families are at high risk of financial hardship which may impact on psychological well-being. In today’s article, we explore the need to develop a healthy relationship with money and beliefs related to money as part of your personal growth.

As a resource and a value, money plays a significant role in facilitating or limiting success. Its impact truly depends on the perspective from which it is viewed. Many people harbor limiting beliefs about money—I was once among them, as a single mother struggling at home, feeling as though I had done everything yet still not earning enough. Every penny spent brought extreme stress, even something as small as a 50-cent lollipop.

In today’s article, if you find yourself grappling with financial issues as I once did, my goal is to assist you by providing a basic guideline for spending and altering the way you perceive money. Spending is an integral part of our daily lives, and the better the relationship you cultivate with money, the more positively you will feel about the process. By shifting your mindset to a more positive vibration, you grant yourself the opportunity to feel better, trust in the universe, and focus your energy on doing your part, thus positioning yourself for growth and success.

Step 1: Create Awarness

Money is something that many people struggle with, and I did too once upon a time. Whether you want to save more money or make more money, it is often a source of negative feelings such as stress and unhappiness. There is a common belief that a person has to be greedy to want more money or that you will never be as lucky as others. Therefore, as a starting point for this article, please write down all your limiting beliefs about money. The main purpose of writing this down is to create awareness, which is the first step of transformation.

Your list could include things like:

  • I can’t make money.
  • I am not smart enough to make money.
  • That’s only for people with exceptional talents.
  • I don’t have time to make more money.

Once you complete your list, go deeper by considering where these beliefs come from. Perhaps they stem from family, politics, childhood, parents, education, friends, or issues related to self-worth and self-confidence. What are your main blockers in thinking about money?

Many of these beliefs are unconscious! A certified life coach can assist you further by unblocking these unconscious thoughts to help you building a better relationship with money. Before we talk about how a coach can help you, there are a few things that you can start doing at home today.

Step 2: Audit your Expenses

It’s important to understand your current spending habits. Take 2-4 weeks to meticulously audit your expenses daily. Write down every expenditure – both online and offline. During this period, it helps you stay conscious about what you’re actually spending. Often, small expenses like coffee, Uber rides, or minor purchases slip by unnoticed. By documenting everything, you gain clarity on where your money is going and can identify areas where you can cut back or make adjustments.

Step 3: 10 Strategies for Money Management

10 Strategies to Transform Your Relationship with Money cash

Strategy 1: Save Before You Spend

Let’s delve into some excellent money management advice, drawing wisdom from some of the world’s most significant financial advisors. It’s crucial to prioritize saving before spending rather than the other way around. As Warren Buffet wisely said, ‘Don’t save what is left after spending; spend what is left after saving.’ People who are happy with their money habits tend to save 20 percent of their net income.

Now, it’s understandable if you’re unable to save 20 percent of your net income at the moment, but view this as a target to strive for. I was in this situation for many years after my divorce.

Go back to your audit spreadsheet. A lot of our money goes into small purchases like coffee, Uber rides, and eating out. Most of us aren’t spending significant amounts on big things; instead, we’re spending lots of small amounts on little things. But remember, all those small amounts add up to a lot, so it’s essential to be mindful of what might seem like insignificant spending.

Ask yourself if there is anything you can tweak based on your audit findings.

Once again, you’re unable to save 20 percent of your net income right now; that’s perfectly okay! Use it as a goal to work towards

Strategy 2: Housing Budget Management

Another helpful tip is to spend no more than a maximum of 25 percent on rent or mortgage. Sometimes, we live beyond our means and, as a result, we struggle with stress and anxiety, which are the two silent killers of health and wellbeing. You will have to make a conscious decision of whether you want to live with less physical comfort, such as in a smaller place or a less desirable location outside of the city center hub, but feel more relaxed, or if you want to prioritize physical comfort despite creating daily mental stress.

If you find yourself wanting to prioritize improving your mental wellbeing, it may or may not affect your external circumstances. In other words, people often seek to change their external situation in hopes of alleviating internal pressure.

Strategy 3: Mindful Spending on Food

Consider not spending more than 15 percent of your budget on food. However, if you prioritize eating healthy and well, you don’t necessarily need to sacrifice quality for cost. What we mean is to be more conscious about your spending, whether it’s dining out or purchasing imported products. Perhaps pay more attention to seasonal vegetables, conduct research on budget-friendly cooking, and explore alternatives that align with your financial goals. Eating healthy doesn’t have to be expensive. By adjusting your food purchasing habits, you’re investing in your well-being, which is far more cost-effective than dealing with illness.

Related article: Mindful Eating: The Secret to a Delicious & Healthy Meal

Strategy 4: Leisure Spending Guidelines

Another good money management tip is also to not spend more than 10 percent of your budget on entertainment. There are plenty of cheap and free options available. Nature, for example, is free, and most hikes cost nothing. Additionally, there are many deals and special offers for leisure and entertainment activities.

Furthermore, consider spending no more than 5 percent of your budget on vacations. There are numerous great deals out there, as well as many hidden gems that you can discover through platforms like Instagram or TikTok. You can still have an amazing trip without breaking the bank. While a vacation may feel good for a week, or a new car may feel good for a few months, they can have health consequences that last for much longer due to sustained stress.

Strategy 5: Overcoming Undesirable Habits

About 70 percent of people who struggle financially engage in gambling. Gambling is an addiction, and those who gamble are the group that can least afford to indulge in high-risk behavior with their money. Apart from gambling, do you have other habits that you could aim to change in your life, such as spending on marijuana, cigarettes, or overconsumption of alcohol? These habits are, of course, not easy to change, especially if you are in an addictive state of mind. However, if you would like to improve your financial wellness, prioritizing the removal of these toxic habits could be a key step.

Strategy 6: Cultivating Financial Wellness Through Giving

When it comes to financial wellness, it’s not just about saving and expense management. Giving to charity can be incredibly fulfilling. When you give, it boosts your sense of self-worth and satisfaction. A study published in the International Journal of Psychophysiology found that people who engage in acts of kindness and generosity experience lower levels of stress and anxiety, along with increased feelings of happiness and wellbeing.

While charity is a personal decision, you can reflect on how much you’d like to give; there are no strict guidelines. You can choose to donate money or volunteer your time. Giving your time also holds significant value in building your financial wellness, whether it’s dedicating five hours per week or even just one hour. What matters most here is the act of kindness. In this process, it will help you to build more gratitude, confidence, self-esteem, and improve your relationship and perspective with money.

Strategy 7: Cash is King

After tracking your expenses, including online purchases and automatic payments from your account, most people are surprised at where their money goes and how much they spend on small things throughout the week. Because so much spending nowadays takes place on credit cards, we are not always aware of every expense. Again, a stream of small spendings can add up significantly.

Another bad money habit is impulse buying, which often leads to some level of remorse. Whether it’s something in the checkout line at the grocery store—designed with impulse buying in mind—or an advertisement that enticed them to make a purchase, these impulse buys result in regret and remorse that accumulate over time.

One of the best ways to curb impulse buying and small spending habits is to pay in cash. When a person withdraws money from the ATM, they have a certain amount of cash in their wallet. When they pay with cash and see it deplete in their wallet or purse, it has a greater emotional impact than using a credit card.

Strategy 8: Invest in Personal Growth for Financial Wellness

The eighth point about spending habits is that financially satisfied individuals allocate 10 to 25 percent of their net income towards personal growth, including investments in courses, online programs, books, and coaches —places where knowledge about personal growth and contribute to a deeper understanding of their relationship with money.

An interesting fact is that 88 percent of financially successful individuals read for 30 minutes or more daily, including listening to podcasts and audiobooks. Only 1 in 50 people who struggle financially read daily. Studies also reveal that the most financially successful individuals in the world spend less than one hour per day watching TV or online content, unless it directly relates to their work. Many people devote excessive time to entertainment, such as binge-watching TV series or sports, which often correlates negatively with effective money management.

Strategy 9: Finding a Balance Between Time and Money

Another crucial aspect of money management is considering the balance between time and money. Financial wellness isn’t solely about saving; it also involves making smart investments in aspects that directly impact your well-being, such as purchasing a quality mattress or eating nutritious foods. Many people waste time trying to save money—especially if it’s a small amount—when they might be better off spending the money and using their time more wisely. Typically, we try to save money on important items and spend it on less significant ones. That’s what I mean by balancing time and money.

In one survey, individuals who made purchases to save time reported higher life satisfaction compared to those who didn’t. Having more time to fulfill responsibilities or to spend with loved ones may be more valuable than the money spent to gain that time. For instance, if you’re a single mother juggling multiple jobs to make ends meet while still striving to spend quality time with your kids, consider outsourcing tasks like cleaning to a professional. This allows you to save time on these chores and redirect your energy towards creating memorable moments with your children. Numerous studies indicate that spending money to save time can significantly reduce overall stress levels.

Ultimately, it’s about knowing how to balance quality time versus money!

Strategy 10: Life Coach

While Strategy 8 suggests allocating 10 to 25 percent of your income to personal growth, including working with a life coach, it’s important to recognize that spending habits profoundly impact people’s lives. The first step towards change is always awareness, often involving uncomfortable or painful realizations. For instance, breaking a gambling or toxic habit may unearth painful memories from the past.

Additionally, during the auditing process, realizing where you’ve gone wrong can initially cause discomfort and stress. It doesn’t feel good to discover you’ve been overspending on unnecessary items, especially if it means stepping out of your comfort zone regarding your current spending habits. For example, reducing debt from luxurious vacations or downsizing to a smaller house can feel unsettling at first. However, these changes may ultimately lead to increased stability, security, and control over your finances.

Money is widely considered the number one source of stress, surpassing personal relationships and work. Transforming this relationship to foster better financial wellness requires effort, often pushing us beyond our comfort zones. Achieving growth entails reprogramming our money mindset, altering the internal dialogue we have about money. Negative beliefs such as “I don’t have enough,” “I’ll never have enough,” or “I must get lucky to have money” can hinder progress.

Do you find yourself doubting your abilities or worthiness? These are false and limiting beliefs. In such cases, a life coach can provide guidance and support to help you stay on track and realize your true worth. By “re-coding” your internal dialogue, a coach can assist you in establishing a healthier relationship with money. They understand how your beliefs about money profoundly impact your emotions and well-being, guiding you towards achieving harmony between your mind and your financial pursuits.

Recommend Reads

Rich Dad Poor Dad

by Robert T. Kiyosaki is a groundbreaking book that challenges traditional views on money and success. Through the contrasting lessons learned from his two fathers – one rich and one poor – Kiyosaki provides invaluable insights into building wealth and achieving financial independence. This compelling narrative delves into the mindset and strategies of the wealthy, offering practical guidance on investing, entrepreneurship, and financial literacy.

Think and Grow Rich

by Napoleon Hill is a timeless classic that reveals the secrets of success and wealth. It provides practical steps and principles for achieving your goals and building wealth through the power of your thoughts. This influential book has inspired millions to unlock their potential and create a life of abundance.

The Millionaire Next Door

unveils the surprising habits and lifestyles of America’s wealthy. Through extensive research, it reveals that many millionaires live modestly and follow disciplined financial practices. This eye-opening book offers practical insights on how to build wealth and achieve financial independence regardless of income level.

The Total Money Makeover:

by Dave Ramsey offers a step-by-step plan for taking control of your finances and transforming your financial future. Ramsey provides practical advice on budgeting, eliminating debt, and building wealth, guiding readers towards financial freedom and peace of mind. This book is a powerful resource for anyone seeking to achieve financial stability and success.

Secrets of the Millionaire Mind: Mastering the Inner Game of Wealth

by T. Harv Eker is a transformative guide to rewiring your mindset for financial success. Eker explores the psychological barriers that prevent many from achieving wealth and offers practical strategies for overcoming them. With its powerful insights and actionable steps, this book empowers readers to cultivate a millionaire mindset and unlock their full potential for abundance and prosperity.

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