Management Magazine
Money Matters Reviews

What you need to know about money disorders

By SAMMI NDERITU

What is your relationship with money? What goes on in your mind when your bank account has money or when it is empty? Does having money make you happy or anxious?

According to Dr. Brad Klontz a financial psychologist, just about everyone has a complicated relationship with money.

Dr. Klontz adds that financial strain has been found to reduce relationship satisfaction, worsen depression, ‘and lead to emotional problems, health difficulties ‘and poor work performance.

In the book Mind Over Money: Overcoming the Money Disorders That Threaten Our Financial Health, Drs. Br ‘and ‘and Ted Klontz say money disorders are persistent patterns of self-destructive ‘and self-limiting financial behaviours. They result from distorted beliefs about money we develop from our financial flashpoint experiences. These are painful, distressing, ‘and/or dramatic life events associated with money that are so emotionally powerful, they leave an imprint that lasts into adulthood.

Below are three categories of money disorders identified in their book:

1. Money Avoidance Disorders. This includes underspending, excessive risk aversion ‘and financial denial, “when, rather than face financial reality, we try to minimise money problems by refusing to think about them all together (e.g. avoiding looking at a bank statement or paying a credit card bill).” Those with financial rejection experience guilt whenever money is accrued.

2. Money-Worshipping Disorders. These include pathological gambling, workaholism ‘and overspending or compulsive buying.

3. Relational Money Disorders. These include financial dependence, financial incest ‘and financial infidelity, like “telling “little green lies” about one’s spending or finances to one’s partner, making purchases outside an agreed-upon budget or lying about the cost of a big-ticket item.

The psychologists say that when we identify our financial flashpoint experiences, challenge our distorted money beliefs, ‘and practice healthy financial behaviours (e.g. maintaining reasonable ‘and low debt, having an active savings plan, as well as following a spending plan), we don’t just become materially richer-we become emotionally wealthier as well.”

Sammi Nderitu is a writer, photographer ‘and digital media expert at KIM. 

Email: snderitu@kim.ac.ke

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