Money Narratives and the Effects of Financial Stress

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We receive all sorts of messaging about money from the media, friends, and family but the beliefs others hold about money might not align with our own. This is why it is important for you to get to know your money narrative. Your money narrative is a key component in figuring out how you can achieve Money + Life Balance.

What is a money narrative?

The experiences we have with money over the course of our lives shapes something called a money narrative. A money narrative is made up of the attitudes, beliefs, and emotions we hold about money. These narratives have a powerful influence on how we spend, save, and manage our money. 

Earlier this year we hosted The Lab, an eight week intensive where participants received exclusive access to evidence-based programming, support, and motivation to break free from financial stress and reach their goals. During our time together we discussed money narratives. To help get the ball rolling, we asked attendees to share some of their earliest money memories. 

Brandon recalled a memory from his childhood where he asked where money came from. His reply was “From my dad’s wallet.” Maria told us that her earliest money memory “was getting a $2 bill to put in [her] Mickey mouse wallet when [she] was like four.” Even these early memories have the power to shape how we view money into adulthood. 

In a perfect world, we would all have positive money memories that would allow us to form positive money narratives. Unfortunately, we don’t live in a perfect world and sometimes things like financial hardship significantly alter our money narratives and cause financial stress.

The impacts of financial stress

We surveyed members to ask them how often they think about their money. If you’re thinking about your money too often, that may be a marker of financial stress. Of the members surveyed, 60% think about their money every day, 30% think about their money 16 to 20 days a month, which is considered regularly, and 10% think about their money 11 to 15 days, which is considered often. 

When your money takes up too much of your headspace, it takes up time and energy that could be spent on activities that bring you joy. According to the American Psychological Association’s 2021 report on financial stress, financial stress can cause increases in child abuse and divorce as well as an increase in negative health outcomes. It can also impose long-term physical and mental costs on individuals, families, and communities. Studies show that financial stress can be linked to decreases in positive emotions, chronic inflammation, gut issues, and sleep problems. 

Though the Covid-19 pandemic has compounded financial stress, the measurements taken by the Financial Health Network indicate that the overall health of Americans has improved since 2019. However, these positive effects might just be temporary because of short term solutions such as stimulus checks during the pandemic. In some cases, financial health disparity actually widened in recent years, including for Black Americans and people making less than $30,000 a year. In other cases, significant financial health disparities continue to persist even overall positive trends such as between men and women’s incomes. 

How do you combat financial stress?

Now that you know how financial stress can impact you, how do you counteract it? Everyone’s needs are different, but there are a few things that will get you moving towards achieving a Money + Life Balance.

Remember that every dollar is not equal. Our emotions are tied to how we spend our money and every spending experience is not the same. A dollar spent on gas and a dollar spent in your favorite store are going to provide different physical and emotional experiences. It’s important that you make sure your basic needs are met, but it’s also important that you prioritize spending your money in ways that provide you with positive experiences. A dollar spent on something that brings you joy magnifies who you are in the world. Your place in the world should not be defined by how much money you make, so begin your journey to reaching financial balance with The Beans. 

Learn more about The Beans here, or download The Beans app to get started now.