It’s Halloween and rather than dress up as Khaleesi, Mother of Dragons, I am masquerading as someone who feels oh-so confident with my money.
You see, for many years I was a reckless spender.
When I was 18, I wrote off my first (and only) car. When I learned about the insurance payout I would be receiving, I quickly decided I didn’t need another car, and I started spending the money in my mind. It was gone within a few weeks of actually receiving the cash.
When I was in my early 20s, there was a period of about a year when I moved into three separate apartments — perhaps impressively, on three different continents! — and moved back out within a few days. On all three occasions, rather than fight to get my deposit back, I wrote the money off and moved on with my life. Though there may be circumstances where it might be necessary to cut your losses and run, these weren’t them. These were decisions born out of reckless abandon and a desire to avoid confrontation at all costs.
Late in my 20s, I moved to America, right around the time of the global financial crisis. I started a business and it made good money, but my personal finances followed a similar trajectory to the rest of the world’s: they crashed and burned. (But it was my fault, not Wall Street’s.)
Then, miracle of all miracles: I came down with a chronic illness and was unable to properly work for almost four years. I wouldn’t blame you if you thought I was being sarcastic when I said it was a miracle; I do like to deal in sarcasm. But truthfully, it was one of the best things that has ever happened to me, because I had to rethink everything I knew about money.
And now, in the aftermath, I’m in a pretty good place. Financially stable and whatnot. No longer compelled to throw my money into the wind, literally or figuratively. But I find myself constantly battling myself on whether a spending decision is a “trick” or a “treat.”
During the years I was sick, I was forced to make ruthless changes to my spending habits. I couldn’t afford to Uber places; I took public transport. If I went out with friends, I couldn’t risk someone buying me a drink, lest I found myself getting stuck in a round. Etcetera.
So, when I take public transport home after a night out, I feel pretty savvy, as though I have really learned something from the whole experience. But sometimes when I decide to Uber home, I immediately worry I’m heading down the spending rabbit hole again.
It seems I was born a reckless spender.
And then, happily, life’s lessons taught me to be careful with money.
And I’ve found with such a drastic change in behaviour and the way I think, there is a loss of confidence. I don’t actually trust that I have changed.
My heart says: I am allowed to treat myself. I can afford it now.
My head says: It’s all a trick. You are being reckless.
But maybe I have it all wrong.
Research from a ten-year study undertaken by the University of Arizona (and unveiled last year) has found your financial self-efficacy — that is, believing in your ability to succeed financially — corresponds quite strongly with your financial wellbeing.
In other words, being “good with money” can come down to mindset.
Of course, there will always be other factors that could tip the scales, such as gender and socioeconomic background. Put quite simply, you might not actually make enough money to have a chance at being “good” with it.
But if I was to take this research at its word, it might simply be enough for me to believe in myself and my ability to make good financial decisions. I have done it before, even if it was due to my circumstances, therefore I can do it again and again?
It’s probably easier said than done.
It might involve chanting “I know I can, I know I can” every time I jump in an Uber or spend $12 on a tiny bowl of pickled vegetables for the table (Sydney, right?) or something similar. But a little mindfulness and belief can likely go a long way.