Finances and Feelings: How to Keep Your Emotions Out Of Your Money

Money is stressful. Don’t let your emotions cloud your financial decisions

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On Netflix’s new show, Marriage or Mortgage, a wedding planner and a real estate agent fight for the business of recently engaged couples, offering them the chance to throw the ultimate wedding or spend their nest egg on a dream home. The premise, while glitzed up with remodeled kitchens and ranch dressing fountains, highlights a more relatable financial dilemma — should you let your emotions drive your financial decisions, or make sacrifices for the chance to build wealth?

Reality TV can make any dilemma appear dramatic, but separating your feelings from your finances can be an everyday struggle. Here’s why it’s so hard, and how to make a decision you’ll feel confident in for years to come. 

Why is money so difficult to manage?

It’s not your fault: Money is one of the most complicated facets of modern adult life. According to a new survey by the FINRA Investor Education Foundation, 60% of Americans reported feeling anxious when thinking about their personal finances.  

Most of us link our feelings to our finances for many reasons — even if we don’t know it. Poor financial decisions often stem from heightened emotional stress over student debt, divorce, job loss or mortgage payments that make your jaw nearly hit the floor by being higher than you expected. Social media can also become a dangerous source of temptation, where the constant “highlight reel” of fancy vacations and expensive purchases can lead to a constant lifestyle competition. 

So many of us were told by society that the American Dream is attainable if you do the ‘right’ things, such as going to college and taking on debt, says licensed professional counselor Sarah Osmer. The reality is that the dream of landing in a better financial place is unlikely for most people, and now we’re left feeling hopeless.

How to keep your feelings out of your finances

Financial management coach Shang Saavedra of Save My Cents says that many of her clients recognize their emotional response to money, but don’t know how to break the cycle. 

Fortunately, it’s never too late to reset your financial mindset, even when the situation feels hopeless. Here are five ways to begin managing your money without getting your feelings involved.

Understand why you do what you do

Unless you treat the problem at its source, you’ll find yourself cycling through bad habits over and over again. Set aside some time to take an honest look at your financial landscape, possibly with a neutral third party as a sounding board. If you share finances with a partner, make it a joint conversation. 


Perhaps you grew up anxious about not having enough money, so even small treats like a dinner out feel like an unnecessary gamble. Or maybe you’ve learned to channel your stress into retail therapy, leaving you with debt you’re hiding from your spouse or partner. There’s a driving factor at the core of your financial decisions, and dismantling it can help you learn to understand why you prioritize, or overlook, certain behaviors. 

Be kind to yourself

Showing yourself compassion may be the most important aspect of separating your emotions from your money. You’re human; you’re going to make mistakes as you embark on your new financial strategy. 

“Very few of us were taught to be financially savvy,” Osmer says. “Have a deep sense of self-compassion if you feel overwhelmed.” 

So if you slip back into impulse shopping or overspend on your budget one month, don’t beat yourself up over it. Instead, take a moment to identify why you stepped out of line — then make a plan to get back on track moving forward.

“Progress, not perfection,” Saavedra tells her clients. “We are what we say to ourselves. And if we constantly tell ourselves that we are not good enough, smart enough, or fabulous enough — we believe it.”

Build a financial system and stick with it

A snowball effect often occurs when people feel overwhelmed by their financial woes. “More avoidance equals more fear,” Osmer says, who pointed out that unpaid bills turn into late fees and skyrocketing interest, which could lead to bad credit. 

But the same concept is true of healthy habits: Little steps make a big difference over time. The “snowball method” and “debt avalanche” are two viable strategies for quickly and efficiently paying down debt. One relies on psychology to trick your brain into emotional momentum, while the other gets practical by addressing your most expensive debts first.

If money seems to flow through your fingers, a budget can help you visualize your monthly expenses. Popular budgeting methods range from good old pen and paper to the envelope method to digital tools such as Thrive, Mint, You Need A Budget or QuickBooks. Don’t get sidetracked by their individual pros and cons: The best budgeting system is the one you can stick with. 

Build an emergency fund for rainy days

Building an emergency fund can give you peace of mind when you need it the most. The amount you should save will vary based on your individual circumstances; many financial experts recommend setting aside enough money to cover three to six months’ worth of living expenses.

Plan ahead for big purchases

Buying expensive necessities such as a couch or a car doesn’t have to drain your bank account. Before all else, try sleeping on your “needs” for a day or two. Do you really need that item, or do you just want it? Or could you find a lower-cost version of the same thing?

And before making the actual purchase, research 0% APR credit cards, no-interest financing or similar options that can help you defray the cost over time. 

Of course, your short-term savings will mean nothing if you end up unable to pay your outstanding balance at the end of a promotional period. So set aside the repayment cash as you earn it — and set a few calendar reminders for your payment due date. 

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