What is Financial Therapy?!?
A couple goes into a restaurant to enjoy a meal together. They sit down and begin to nag each other about how they each spend money. A financial planner, a therapist, and a bartender all happen to be sitting at tables nearby.
The financial planner overhears the couple’s conversation and says, “I work with couples like the two of you all the time; let’s put together a financial plan and that will surely help ease your disagreements once you know what you are supposed to do with your money.”
The therapist overhears this advice from the planner, and promptly leans over and says, “Wait a minute! Things aren’t that easy. Don’t you know that they are both projecting onto each other?”
The financial planner responds, “What? Projecting is putting an idea on one person that belongs to another person. Let’s get the couple in my office, and I will get to the root of this.”
Meanwhile, the bartender is watching the couple, and now the couple looks really confused because they just came in to relax for a bit. The bartender offers the couple a complimentary drink, and the couple begins to laugh about how spending money on sporting events is more important than home décor.
Why do we need Financial Therapy? I could not have dreamed about this concept ten years ago when I was studying to become a financial planner. The equation was easy at that time: Money + Marriage = Get A Financial Plan. Then came some difficult reality: Money + Marriage = Madness!
Working with individuals and couples regarding money issues led me to realize I was missing one very important detail: I thought like a business person and not a human. Since that time, I earned my graduate degree in counseling and began work as a therapist; now the financial impact on a marriage is clearer.
Welcome to the world of financial therapy! Your dad, pastor, grandmother, daughter, Madison Avenue, Dave Ramsey, and just about everyone has an opinion about what you should do with money. They may all have good points, but not always. And their opinions won’t help you manage your own financial and emotional challenges.
What makes Financial Therapy unique?
It’s not about right answers. But how can that be? Everyone knows you can’t spend more than you earn forever, and that you should save 10% of your income for retirement, and Grandma always said you should give something to the church. Easy, right? If only that was the case.
The reality is that we each have a complex relationship with money, and money touches every major aspect of our life. Financial therapy provides a highly qualified listening ear to identify the patterns and themes that emerge around money for each person, and then it helps to start to clarify those themes for the person.
Why does this help? The reality of psychology is that none of us see ourselves as clearly as we think we do. By having a trained therapist reflect what is being heard, you can begin to see yourself more fully and begin to make new financial decisions. In time, your patterns around money begin to evolve.
Financial Therapy Example
Kristin finished graduate school to become a Physicians’ Assistant; her husband Jason helped finance her education through his hard work as an engineer. She then decided it was time for them to try to have their first child. They became pregnant soon after trying to conceive, and Kristin decided to put her working career as a PA on hold for now. Kristin’s mother, Susan, had been hounding after the couple for years to give her a grandchild. To say Susan was over the moon about the baby news would be putting it mildly.
As time came closer for the delivery, Susan would mention to Kristin that “It sure would be nice if you bought me a plane ticket to be there at the delivery, since Jason just got that promotion and all.” Kristin tried to ignore her mother’s comments, but they would eat away at her as she knew there were several layers of meaning behind the comments. Yet, she just could not put her finger on what specifically about the comments bothered her so much. Kristin would tell Jason once again about what her mother said, and he would casually dismiss her observations as “that is just your mother being your mother.”
Fast forward five years. Jason and Kristin now have three children, and what intimacy was in the marriage previously has faded somewhere in the past. Jason resents Kristin’s playdates at the park, nap times, and coffee breaks with friends. Kristin secretly longs for the professional identity that she had wanted from her physician’s assistant career. While she smiles on the outside, on the inside that pit in her stomach is eating her up. Susan continues to make comments about Jason’s increasing financial success and that she “needs help with money since she is living on a fixed income.” What once felt like a bright future with lots of hope, now feels like a trap closing in.
Jason and Kristin decide it is time to reach out for help.
Jason is not one for talking about his feelings. He hears about Financial Therapy and thinks, “Oh good, maybe someone that understands money and numbers can help me get Kristin on track with her spending and get her mother off my back.”
This is where the surprise comes into play for Jason. Financial Therapy looks at not just financial functioning, but also emotional and relational functioning, since all three are connected with each other. At first, he resists and insists that it is just money, we need a financial plan, and here is how we should do it.
Over time, as Jason begins to talk about his financial history, the picture becomes clearer. His father ran a small engineering firm in the town he grew up in. Unfortunately, his father’s business partner embezzled enough money from the engineering firm that his father had to file bankruptcy. Jason was ten years old when that happened; he remembers the anger and sadness of his father like it was yesterday. Even more significantly, Jason remembers the depression that overwhelmed his mother, when his father’s firm’s bankruptcy occurred.
It took three or four years before his father was able to rebuild a new firm, but Jason’s father was never same. His parents’ communication shifted from functional to bitter and resentful. Through Financial Therapy, Jason now realizes that he is projecting his family story onto his wife, Kristin. Jason’s family’s financial trauma leaves him with unspoken anxiety about any financial decisions Kristin makes. He is now able to see how not addressing his own anxieties about money, and making the problems all about Kristin paradoxically recreates much of the same distance he watched between his mother and father.
Additionally, financial anxiety drives Jason to work in a large, multinational firm where long hours are the norm and divorce is common in the top leadership. He can see this coming and does not want that for his family. Jason and Kristin both commit to an ongoing therapy process to heal and integrate their financial lives with the rest of their lives.
What Can Financial Therapy Mean to You?
While I wish that this story could capture the full complexity of Financial Therapy, it does not. It does give a glimpse into the complex web of relationships that we form between money, ourselves, family, and community. No amount of financial planning can undo the anxiety that both Kristin and Jason experience, but therapy can.
Therapy is ideal to address the subjective (emotional) side of money problems. As that gets addressed, then dealing with the objective financial decisions (Saving, Spending, Giving) gains clarity, and the work of financial planning begins to make more sense.