For Clare, devotion to a music career has its drawbacks. She drives a rusted '92 Toyota missing a door handle and hasn't been to the dentist in six years. Still, part of her feels afraid of what having money might do to her. She'd rather stay broke if it means staying true to who she is.
Like a bad-news boyfriend, the fun of spending got Elaine into trouble -- $30,000 worth of it. So she broke up with her money, declaring bankruptcy at 26. She's learning to trust herself again, a little at a time.
Money is many things to many people. For some, it beckons and entices; others find it dour and forbidding. Whatever the relationship, that rapport directly affects our ability to attract, spend, and hang on to what we have.
"Whether there's $10,000 in our account or $10 million, we follow the same behavioral patterns," says New York Times personal finance columnist MP Dunleavey, author of "Money Can Buy Happiness." Changing our approach to money, she says, comes when we're able to take an honest look at the inner workings of our personal financial connections.
So how have you been treating your money lately -- and how has it been treating you? Maybe you feel inferior to it, or don't take it seriously. Maybe it bullies you around or seems to skip town when you need it most. On the following pages, we analyze some of the most common roles money plays in people's lives. You may recognize yourself in a few of the stories -- and that's a good thing.
The more aware you are of how you and your money interact, the easier it will be to curb bad habits, let go of self-sabotaging myths, and improve your sense of security and worth. Pair that with our experts' valuable tips and tricks, and you'll be well on your way to taking that partnership from shaky or tense terrain back onto solid ground.
Look at Your Money Biography
What does your financial profile say about you? Susan McCarthy uses this exercise to help people get a clearer picture. Imagine that the only way people could know you is through your money: your bank and credit card statements, checkbook, and trails of receipts, as well as the messages you put out into the world about money.
What do you spend, and how? Are you always complaining about money, or acting ashamed of it? What kinds of lessons do you teach your children about money and how to use it? Ask yourself if the person reflected back at you through your dealings with money aligns with how you see yourself and how you want to be seen.
Make Friends with Your Finances
Building a healthier relationship with your money starts with how you treat it. "Every relationship has its own specific needs," says Dunleavey. "You have to figure out what your money needs from you before you can get what you need from it."
Think of one of your dearest relationships and quickly jot down five statements that describe the way you treat that person -- for example, "I worry about her," "I make him laugh," or "I'm there when she needs me." Now write down five statements that describe the way you treat your money. Do you worry about it? Guard it possessively? Enjoy it? This exercise can give you some insight into how to make money your ally, instead of your enemy.
Examine Your Instincts
Can you name your knee-jerk tendencies when it comes to money? If you're not sure, says McCarthy, take the windfall test. If some money were to come into your hands somehow, whether by way of an inheritance, a tax rebate, or a big bonus check, what would you be tempted to do with it? Bury it in a hole in your backyard? Go on a splurge at Barneys?
Is "free" money an excuse to spend more than you have, an opportunity to invest in something that actually matters, or a chance to pay off debt? Look closely at your initial response and ask yourself what it tells you about your own financial instincts.
Ruling emotions: anxiety, bitterness, disappointment
At one point, Ann earned close to six figures as a pharmaceutical sales rep. But now, as a stay-at-home mother of two small children, she's no longer the power earner of the household. Sure, her dentist husband looks forward to a thriving practice, but he doesn't own it yet. In the meantime, they don't have an inch of wiggle room in their budget. What used to be a constant and easy companion is now little more than a friend that shows up briefly, if at all. "I want to say to our money, 'Hey, where you been? Why don't you stick around?' " she says. "But it doesn't. It's gone in an instant."
It's a common feeling among those who suddenly find themselves in a financial bind. But that attitude gives money power it just doesn't have. "It's not as complicated as we might think. In order to better manage our finances, we either have to cut expenses or make more money, plain and simple," says financial adviser Susan McCarthy, author of "The Value of Money." "See it as a challenge to trim your budget. Some expenses are fixed, but many are not. Lots of what we spend just gets unconsciously frittered away. That's what you can attack."
Try this: Get back in control
Some money-saving options are obvious, such as using less electricity, paring back on excessive spending, or scrutinizing the grocery list. Collaboration can go a long way, too: Consider cutting back on child-care expenses by swapping babysitting favors and saving on gas by carpooling. Work the other side of the equation as well by thinking about what side income you can bring in -- even if it just covers the food bills. By meeting this call to action head on, you'll feel more confident and in control.
Money As ... The Judge
Ruling emotions: inadequacy, uncertainty, confusion
For some, money speaks in harsh, critical tones. It's disappointed in the way you've handled it and tells you so. "Maybe you feel that your money has no faith in you," says Dunleavey. "When you see it that way, you won't feel positive, and that will have a negative impact on how you deal with it."
Perhaps you feel bad that you didn't read the full 27-page prospectus on your mutual fund, that you don't subscribe to the Wall Street Journal, or that you haven't saved enough for retirement. The effect? You feel inadequate and incapable -- not a good foundation for a healthy money relationship.
To begin to turn things around, find out where that voice is coming from. Your parents? Financially savvy friends who think they know more than you? Get to the source of it and question it. But even more important, take note of what sound decisions you have made (and there must be some). Put the criticism in perspective, and work on honing your gifts rather than calling out your weaknesses.
Try this: Give yourself credit
Turning an antagonistic relationship around starts with giving credit where credit is due. Don't focus on what things you "should" have done, says Dunleavey. Think instead about what's working. Make a list of a few money-related triumphs you're proud of. Maybe you haven't saved as much as you'd like, but you've started to put $20 from each paycheck into a high-yield savings account. Perhaps you've found a way to cut corners on your expenses and saved a couple bucks.
Now, focus on your strengths. Are you organized? Naturally frugal? Creative with savings? Write them down next. Then, on the right-hand side, jot down no more than three areas where'd you like to make some financial improvements and some small, positive steps that will help you achieve those goals. "And no looking back," says Dunleavey. "What's done is done. Start where you are and you'll begin to feel different in no time."
Ruling emotions: playfulness, festivity, excitement
You know this one all too well. It's your money dressed to the nines in a cute belt and the perfect boots. She's stylish, she's fun, and she's beckoning you to come play with her -- at the mall, that new boutique, or Target during the end-of-season sales. Come on, she says, tugging you by the hand. You deserve it. Live a little. It's a difficult offer to turn down.
When you're caught up in the excitement of a potential new purchase, any memory of a Visa bill goes by the wayside. Of course, there's nothing inherently wrong with a little frivolous shopping now and then -- so long as you do it consciously and with a clear head about what you can (and can't) spend. But taken to the extreme, thrill shopping becomes debt.
"In some cases, it clearly amounts to self-sabotage," says McCarthy. "We get caught up in the notion that we want to spend money for the experience it gives us, regardless of the consequences." Even dropping a little cash here and there, Dunleavey points out, can take a toll in the long run. "You can actually waste $10,000 a year by spending a mere $27.40 a day. When I did the math, I was shocked."
You can have excitement in your life without getting in over your head, however. The key is to get at the root of what's behind the whimsical or chronic spending, so that you, not the situation, are in control. One way to counter that "come hither" allure? Notice the impulse, and label it. Ask yourself how appealing that purchase will be a week or a month from now. When you're on a shopping jag, take a limited amount of money, and pay in cash. "You can be thoughtful and choosy and still embrace the playfulness," Dunleavey says.
Try this: Uncover the source
For one month (or even one week), note not just what you're spending, but why. Tracking these emotional patterns can show you the reasons you spend money, says McCarthy -- whether it's because you're depressed, anxious, or just plain bored. Do you tend to go on a shopping binge after you've received bad news? Do you look for a "retail therapy" boost? After a few days or weeks, a clearer picture of your emotional triggers will emerge, which can help you make better decisions going forward.
Try this: Remove the triggers
The barrage of consumer-driven messages embedded into every facet of life fuels our compulsion to buy things -- particularly stuff we don't need. One area you can control? Catalogs. Rather than stockpile them, cut them off at the pass: Go to catalogchoice.org to opt out of future mailings. Or take most of them directly from the mailbox to the recycling bin. Note any change in your buying habits as a result -- and on the pressure you feel to buy things you don't need.
Money As ... The Monk
Ruling emotions: guilt, shame, self-denial
Raised in a poor, Catholic family, Madeline learned early on that anyone who had or wanted money was morally suspect. "Growing up with very little made me scrappy, resourceful, independent," she says. But that same aversion toward money, combined with an underlying sense of unworthiness, set her up for problems down the road. As an adult faced with the debt accrued while earning her Ph.D., Madeline realized that she had to drop the notion that money dirties hands and minds, or else she'd never pull out of her financial straits. Once she started believing more in herself, her attitude toward money followed suit. She started to leverage her talents for more income, and even considered buying a place instead of feeling doomed to rent forever.
"It's natural to allow our own inherited notions about money to go unquestioned," says certified financial planner Julie Murphy Casserly, author of "The Emotion Behind Money." "After all, it's how we were raised. But you have to really look at them, and ask yourself, 'Is this what I want my life to be?' You need to make a conscious choice to let those ideas go." Whether it's an ascetic attitude toward money or the belief that you're no one if you don't have a fat bank account, uncovering those notions marks the first step to financial health.
Try this: Start fresh
Consider the attitudes about money you learned at an early age. Was it the root of evil? The Holy Grail? Did you learn to seek it at all costs, or never give it a second thought? What did your first dealings with money -- allowance, babysitting cash, $10 tucked inside a birthday card -- teach you?
List actions you can take to create a new reality, if necessary. For instance, to undo the notion that money is bad, use it to express your values by donating to an important cause. To counter a fear of lack, share your wealth with someone who could use it. "Tell me what you're doing today, and I'll show you your reality tomorrow," says Casserly. "It's about having the courage to choose a different consciousness."