The Most Hated F-Word

Dr. Heather Kappes | Associate Professor | Researcher

Summary:

Dr. Heather Kappes explains how beliefs and meaning influence spending and wealth. She discusses why high-income earners often live paycheck to paycheck due to social pressures and the importance of understanding the meaning behind spending for better self-control. She also highlights the role of scarcity in spending decisions.

The conversation touches on the beliefs of the FIRE (Financial Independence, Retire Early) community, how children form beliefs about spending and the impact of social pressure. Key themes include the relationship between spending and happiness, financial literacy, and cultural differences in spending attitudes.

Takeaways

The "spending implies wealth" belief can lead to financial vulnerability.

High-income earners often live paycheck to paycheck due to social pressures and spending beliefs.

Understanding the meaning behind spending is key to behaviour change and self-control.

Scarcity impacts spending decisions and complicates consumption smoothing.

The FIRE community’s beliefs on saving and spending can improve financial habits.

Spending does not necessarily lead to happiness or indicate wealth.

Younger children often equate spending with happiness, while older children develop a nuanced view.

Parents can foster healthy spending habits in children through discussions about money, teaching opportunity costs, and encouraging saving goals.

Financial literacy programs should address social and psychological factors influencing spending, beyond basic concepts.

Quotes:

"Living life at the time that you have it."

"Spending implies that you have money, that you have wealth."

"I think it's natural for kids to feel disappointed when we say, 'We're not spending right now.'"

"It's not just like abstractly saving, but it's saving for some kind of goal."

Links:

Dr. Kappes' website: CLICK HERE

With Deborah Price | CEO of Money Coaching Institute | Author |

Summary:

In this episode, Shaun chats with Deborah Price, a money coach, about how our personal identity ties into our relationship with money. They explore how family heritage shapes our money beliefs and the influence of spirituality and philosophy on our financial mindset.

Deborah explains how we can uncover and change our unconscious money habits. She emphasizes the importance of understanding our deeper needs and not linking our self-worth to our net worth.

The conversation touches on how trauma affects our financial behaviour and the importance of self-acceptance. They discuss how spirituality can bring more meaning to our financial lives and warn against the constant chase for material possessions, which can harm our well-being.

Deborah explains the unique approach of money coaching, which looks at money's psychological and behavioural aspects. She stresses that self-awareness and self-love are key and that we must address the root causes of our financial issues, not just focus on budgeting.

A main takeaway? For a happy and healthy relationship with money, know and love yourself.

Takeaways

Family lineage and experiences shape our money beliefs and behaviours, and understanding these influences can help us make conscious choices.

Including spirituality and philosophy in our relationship with money can help us find deeper meaning and fulfillment beyond material possessions.

Changing our behaviour at the root requires uncovering unconscious beliefs and taking intentional actions to create new patterns.

Separating our self-worth from our net worth allows us to cultivate a healthier and more balanced relationship with money.

Traumas (little ones and big ones) can have a significant impact on our relationship with money, leading to patterns of fear and a belief that it is not safe to have money.

Uncovering unconscious beliefs and patterns is essential for understanding and changing our financial behaviours.

The constant pursuit of material possessions and the misalignment of our values can negatively impact our overall well-being.

Money coaching offers a unique approach that focuses on understanding the neurodynamics and behavioural side of money, leading to effective and lasting change.

Links:

The Money Coaching Institue: CLICK HERE

Deborah's LinkedIn Page: CLICK HERE

With Professor Meir Statman | Professor | Author

Summary:

Dr. Meir Statman shares his personal money story and the lessons he learned from his parents about saving, spending wisely, and giving. He highlights the importance of parents helping their children when they are young and just starting out, rather than waiting until they are older. Dr. Statman also explores how pain shapes our outlook on wealth and well-being and the power of acceptance in finding satisfaction in life. He distinguishes between financial well-being and life well-being, emphasizing that financial well-being is crucial to overall life well-being.

Dr. Statman discusses balancing financial stability with personal fulfillment. He stresses the need to save for the future while encouraging young people to enjoy their lives and not focus excessively on saving. Dr. Statman underscores the importance of giving generously to family, friends, and the community, advocating for giving with a warm hand rather than a cold one. He concludes by discussing the different types of capital that contribute to well-being: financial, social, cultural, and personal.

BIO:

Meir Statman is the Glenn Klimek Professor of Finance at Santa Clara University, specializing in behavioural finance. He explores how investors make financial decisions and how these decisions impact financial markets. His latest book is "A Wealth of Well-Being: A Holistic Approach to Behavioral Finance".

Meir's research addresses questions about investor behaviour, cognitive and emotional errors, and their effects on saving spending, and portfolio choices. His work is widely published in leading finance journals and supported by prestigious organizations.

He serves on several editorial boards and has received numerous awards, including the William F. Sharpe Best Paper Award and the Moskowitz Prize. Meir consults for investment companies and frequently presents his research globally. He holds a Ph.D. from Columbia University and an MBA from the Hebrew University of Jerusalem.

Takeaways:

Parents should teach their children the importance of saving, spending wisely, and giving

Pain can shape our outlook on wealth and well-being, and sharing our pain with others can enhance our well-being

Acceptance is important in finding satisfaction in life

Financial well-being is a critical element of life well-being

Taking risks in a vocation that aligns with your emotional needs can lead to greater life satisfaction. Save for the future, but also enjoy life and don't focus too much on saving when you're young.

Give with a warm hand rather than a cold one, and support family, friends, and community.

Different types of capital contribute to well-being: financial, social, cultural, and personal.

Quotes:

"I should spend money but don't waste it."

"It's better to give with a warm hand than a cold one."

Links:

A Wealth of Well-Being: A Holistic Approach to Behavioral Finance Hardcover by Meir Statman

Professor Meir Statman's Website: CLICK HERE

with Jared Rabinowitz | Serial Entrepreneur | Founding Partner Q Wealth |

Summary:

In this episode, I am delighted to speak with serial entrepreneur and founding partner of Q-Wealth, Jared Rabinowitz. Our conversation centers around the significance of positive psychology in Jared's life, his career, and the financial planning industry as a whole. Jared shares his journey integrating positive psychology at Q-Wealth, reshaping how we approach money and financial planning by focusing on wealth, wellness, and well-being. We discuss the profound impact of meaning and intentionality in wealth management, highlighting Jared's insights on enhancing financial well-being through positive psychology. This episode embodies the mission of Q-Wealth, 'where money meets meaning'.

Takeaways

The integration of positive psychology into the financial planning process

The impact of relationships and an abundance mindset in the financial industry

The evolution and reinvention of Q-Wealth Partners

Exploring how social connections intersect with positive psychology and financial planning, emphasizing meaning, time, and intentionality in managing wealth.

The future of financial planning shifts towards coaching-based practices, focusing on clients' intrinsic motivations, personality, and psychology to define and achieve life goals.

The marriage of positive psychology and money aims to create a more accessible and transformative experience for clients, focusing on a coaching component and a focus on EQ over IQ.

Quotes:

"Money is an excellent servant, but a terrible master." Jared Rabinowitz

LinkedIn:

Jared's LinkedIn: CLICK HERE

Q-Wealth Partners: CLICK HERE

Cara Macksoud, FBS® | CEO of Money Habitudes |

Summary:

Cara Macksoud discusses her journey from playing ice hockey on an all-boys team to working on Wall Street and eventually transitioning to nonprofit work. She highlights how her upbringing influenced her financial mindset, the impact of her parents' teachings, and her own experiences with money.

The conversation covers key topics like the correlation between input and output, the pain of paying, and the importance of teaching children basic job skills. Cara also reflects on pivotal moments that led her to shift from a high-energy Wall Street lifestyle to parenting and seeking flexibility and autonomy.

Her work with unbanked kids and transition to financial education and psychology therapy culminated in her role as CEO of Money Habitudes. Throughout, Cara emphasizes the importance of understanding one's relationship with money, decision-making complexities, financial independence, and the pursuit of happiness.

BIO:

Cara Macksoud, FBS® is the CEO of Money Habitudes. After a 15 year career as a trader on Wall Street and stint as a CFO for a NYC nonprofit, Cara transitioned into the behavioral finance space. She completed the Financial Therapy Graduate Certificate at Kansas State University and holds a BS in Finance from NYU Stern School of Business. She is a Certified Financial Behavior Specialist® and a member of the Financial Therapy Association where she serves on the board as the Chair of Student Engagement. Additionally, she is a member of the Association of Financial Counseling and Planning Education (AFCPE) and is an AFC candidate.

Takeaways

The influence of upbringing and family on financial mindset and career choices

The transition from a high-energy Wall Street lifestyle to parenting and the challenges of staying home led to a realization of the need for flexibility and autonomy.

Cara's work with unbanked kids and the shift to financial education and psychology therapy played a significant role in her career transition to becoming the CEO of Money Habitudes. Understanding one's relationship with money is crucial for financial well-being and personal fulfillment.

Balancing work, family, and personal fulfillment is a complex and ongoing challenge.

The pursuit of happiness and fulfillment evolves over time, and it's important to adapt and reassess one's goals and priorities.

Time is a valuable and finite resource, and making the most of it is essential for a fulfilling life.

LINKS:

Cara Macksoud LinkedIn: CLICK HERE

Money Habitudes: CLICK HERE

With Dan Haylett | Director of Growth | Financial Planner | Podcaster

Summary:

In this conversation, Dan and Shaun unravel the common misconceptions about retirement. They share personal experiences and explore how true wealth involves much more than money—it's also about having time, strong social connections, and freedom. They discuss how retirement should be a mix of relaxation, meaningful activities, and personal growth. Dan breaks down retirement into three phases: the active "go-go years," the slower "go-slow years," and the quieter "no-go years," stressing the importance of planning your finances to fit these stages. Dan touches on the challenges of shifting from saving to spending and highlights the importance of thoughtful planning about what you're retiring to. Dan encourages finding a trusted financial planner to help make the most of retirement, reminding us that time is priceless, and it's crucial to consider how we use it and who we share it with.

BIO:

Dan Haylett is dedicated to inspiring retirees to embrace life and experience true wealth. As a co-director of TFP, his driving purpose is to help clients focus their time and money on what truly matters. With a deep understanding of the emotional, behavioural, and financial challenges that come with life after work, Dan is uniquely positioned to guide retirees toward the freedom and confidence they need to fully enjoy their retirement years. His commitment ensures that every client can take full advantage of the gift of their retirement years.

Takeaways

Retirement is not just about leisure activities; it should involve meaningful work, personal growth, and learning.

Wealth is not solely defined by money; it includes time, social connections, and freedom.

Clients have the answers; financial planners should listen and create a safe space for deeper conversations.

Helping clients define what true wealth means to them is crucial for a fulfilling retirement.

Retirement is a new era for personal growth and pursuing passions that may have been put on hold.

The concept of retirement as a finish line and decline is flawed; it should be seen as a start line for a new chapter in life. Retirement is an opportunity to explore who we want to be and spend our time and money on our passions.

Retirement can be divided into three phases: the go-go years, go-slow years, and no-go years.

Time is worth more than money, and it is important to prioritize how we spend our time and who we spend it with.

Quotes:

"Wealth doesn't mean money."

"The answer to how much is enough is so much lower than what they thought it was."

"Retirement allows feeling free and being curious about exploring who we want to be."

"Our spending pattern should be in line with how our healthy years and longevity will be."

"Moving from a savings habit to a spending mindset is one of the most challenging things in retirement."

LINKS:

Dan's Website: CLICK HERE

Dan's Podcast Humans vs Retirement: CLICK HERE

Dan's Social: X

With Dr. Jordi Quoidbach | Behavioural Scientist | Professor | Speaker

Summary:In this episode, Dr. Quoidbach explores the relationship between money and happiness. He points out that while money does impact happiness, its influence is surprisingly limited, especially at higher income levels. He notes that financial stress significantly affects happiness among those with lower incomes.

Dr. Quoidbach recommends seeking jobs that offer meaning, connections, and growth opportunities. He also suggests outsourcing unenjoyable tasks to free up time for more rewarding activities and emphasizes the importance of maintaining strong social ties for overall well-being.

He further discusses how wealth can reduce our ability to appreciate the smaller joys in life, as constant access dulls our enjoyment. Taking breaks from constant consumption and temporarily giving up pleasures can enhance our capacity to savour life.

The episode also touches on the benefits of happier individuals engaging more effectively in challenging discussions and negotiations, enhancing their happiness. Lastly, Dr. Quoidbach highlights research showing that happier companies perform better in the market and discusses the cognitive costs associated with poverty.

Takeaways

There is a correlation between money and happiness, but it is much lower than people think.

Money matters more at lower income levels, where financial hardship can cause stress and negatively impact happiness.

Pursue jobs that provide meaning, connection, and opportunities for growth.

Social connections are a significant predictor of happiness.

Money can act as a buffer against stress, but its impact on happiness diminishes beyond a certain point.

There is a cognitive cost to poverty. As income increases, the ability to savour the little things in life decreases.

Reminding ourselves that life is unpredictable and that access to things may not last forever can enhance our ability to savour.

Taking breaks from consumption and giving up something we enjoy for a period of time can help reset our savouring level.

Happy people are more likely to engage in tough conversations and negotiations, which can lead to overall happiness.

Quotes:

"Money offers psychological freedom to be not so much short-term focused and maybe think outside the box."

"The more you went to fine dining, the more you went to Michelin star restaurants in your life, the less likely they were to savour these things."

Links:

Dr. Quoidbach Website: CLICK HERE

With Dennis Harhalakis | Certified Money Coach (CMC)® | Founder of Cambridge Money Coaching

Summary

Dennis shares his journey from knowing a lot about money to realizing he didn't know much about money and himself. He discovered his inherited money anxiety and how it affected his behaviours and beliefs (unconscious to himself). Self-forgiveness and self-compassion played a crucial role in his journey of change. Money coaching is different from financial coaching in that it focuses on the why behind financial behaviours and helps individuals understand their money patterns and beliefs. It involves reaching out to clients, validating their feelings, and building trust and connection.

Dennis discusses the importance of creating a safe space for clients to talk about money and building trust with them. He emphasizes the need to meet clients where they are and normalize their feelings about money. Dennis also highlights the significance of understanding a client's money history and beliefs in order to help them make financial decisions. He explores the idea of having a healthy relationship with money, which is based on positive feelings about oneself, money, and money in oneself.

Highlights:

Money coaching focuses on understanding the why behind financial behaviours and beliefs.

Self-forgiveness and self-compassion are essential in the journey of change.

Inherited money anxiety can affect behaviours and beliefs around money.

Money coaching involves reaching out to clients, validating their feelings, and building trust and connection. Create a safe space for clients to talk about money and build trust with them.

Meet clients where they are and normalize their feelings about money.

Understand a client's money history and beliefs to help them make financial decisions.

Develop a healthy relationship with money based on positive feelings about oneself, money, and money in oneself.

Recognize one's own worth and sufficiency.

Quotes:

"I knew a lot about money, but not much about money and myself." - Dennis Harhalakis

"Self-forgiveness and self-compassion play a role in the journey of change." - Dennis Harhalakis

"People want to talk about money desperately. We haven't always had the environment or the trusting person that we feel like we can share." - Dennis Harhalakis

Links:

Dennis' Website: CLICK HERE

With Todd Kashdan Ph.D.| Best Selling Author | Professor | Clinical Psychologist

BIO:

Todd B. Kashdan, Ph.D. is a Professor of Psychology at George Mason University, and a leading authority on well-being, curiosity, courage, and resilience. He has published over 200 scientific articles, his work has been cited over 32,000 times, and he received the American Psychological Association’s Award for Distinguished Scientific Early Career Contributions to Psychology.

His books Curious? and The Upside of Your Dark Side has been translated into over 15 languages. His writing has appeared in the Harvard Business Review, National Geographic, and other publications, and his research is featured regularly in media outlets such as The New York Times, The Atlantic, Fast Company, and Time Magazine.

He’s a twin with twin daughters (plus one more), with plans to rapidly populate the world with great conversationalists.

Highlights:

Curiosity can help us unlock creativity and become a principled rebel

How curiosity and the art of insubordination can help us re-write our money stories

The power contained within asking questions to “seek to understand” before judging

How money can increase your well-being……..when used in the proper ways

How the three temporal dimensions (parts of time) of buying experiences provide towards our well-being (anticipation, being on the trip, post mortem)

How cultivating psychological flexibility can help us gain clarity over our money stories

Why acceptance and honouring our dark emotions is beneficial to our well-being

Links:

The Art of Insubordination Book CLICK HERE

Todd’s website CLICK HERE

With Dr. Rick Scott | Behavioural Scientist | Author | Associate Professor

Summary:

This episode explores the psychology of money and our relationships with money, beginning with a debt prioritization study that even caught the eye of financial guru Dave Ramsey, who called Dr. Scott an 'egghead'. The discussion broadens to include personal stories about how family influences and past experiences shape our spending habits.

We also examine the contrasting spending styles of 'tightwads' and 'spendthrifts,' revealing the emotions behind each approach and their impact on financial decision-making. Emphasis is placed on the importance of self-awareness in recognizing our own fears and anxieties about money.

Dr. Scott then explores how couples handle finances, discussing the benefits of joint bank accounts for fostering trust and minimizing financial disputes. It introduces the concept of financial translucency—maintaining a healthy awareness of each other’s financial activities without needing detailed oversight. Challenges arising from different spending habits are considered, highlighting how mutual understanding and compromise, particularly in gift-giving, can lead to greater relationship satisfaction and happiness.

Takeaways

The psychology of money is influenced by both mathematical and emotional factors.

Personal experiences and family stories play a significant role in shaping our views and behaviours around money.

Tightwads and spendthrifts have different orientations towards spending, but both can experience regret and anxiety.

Understanding our tendencies and emotions around money can help us make more informed financial decisions.

Joint bank accounts can promote trust and reduce scorekeeping in couples. Financial transparency and trust are crucial in a relationship.

Mismatched spending habits can be challenging, but there is potential for happiness with mindful approaches.

Finding balance and happiness in financial matters requires individuality and joint decision-making.

Privacy and secrecy can coexist in a relationship, but certain secrets can be destructive and need to be addressed.

Links:

Dr. Rick Scott's Website: CLICK HERE

Tightwads and Spendthrifts: Navigating the Money Minefield in Real Relationships