There are two camps when it comes to teaching people about money. In one camp, we have the practical and tactical financial experts, armed with spreadsheets, interest calculators, and checklists. In the other camp, we have the magical money gurus, armed with vision boards, crystals, and sacred archetypes.
So, which one can actually help YOU to master your personal finances and say goodbye to money stress for good? Actually, it’s both and neither. Let me explain…
Why You Need Practical Magic for Your Money
The Practical Financial Experts
The practical financial experts are the money nerds armed with spreadsheets, financial calculators, and a plan to retire a decade or two ahead of the pack. They are focused on WHAT to do with your money: budgeting, cutting expenses, piling money into savings, demolishing debt, and maxing out retirement accounts.
Many people weren’t taught the basics of personal finance at home or school, so this is valuable and needed knowledge! If you want to get your money shit together, you definitely need to learn what to do with your finances. There is a wealth of knowledge in this camp on how to master your spending, accelerate debt payoff, and invest wisely for the future.
Although the practical financial experts have the money management techniques in spades, they are missing something vital. By and large, these folks ignore the psychology of personal finance: WHY people do what they do with their money. Scientists recently discovered the moment of decision happens in the same part of the brain which processes emotion. That means it’s literally impossible to make a purely logical money decision!
This is one of the reasons why I saw my former Financial Peace University students fall off the wagon 12 months, 18 months, or 24 months after completing the course. At first it baffled me! I thought they had all the knowledge they needed to succeed. It wasn’t until I started studying the emotional side of money and behavioral finance, that I finally figured out what was missing.
The Magical Money Gurus
The magical money gurus are armed with vision boards, affirmations, crystals, and sacred archetypes. These individuals preach the “woo-woo” side of personal finance. It’s all about your energy and how you FEEL about your money. They are focused on your relationship with money, healing past money trauma, forgiveness work, and gratitude.
I learned NONE of this when I earned my Certified Financial Counselor designation. When I began to discover this side of personal finance, a whole new universe opened to me. I realized why some of my students and clients struggled to implement various financial tactics. Emotions drive our behavior and if we don’t understand how this works, we will be forever fighting against them, instead of harnessing their power.
Many of the practices the magical money gurus teach are actually supported by science and aren’t as woo-woo as you might think. There are scientific reasons why vision boards, positive money affirmations, and improving your relationship with money actually work.
Most of these gurus know these things are effective, but few of them teach the science behind WHY they work. And some of these magical money gurus do teach things that are just plain hokum. Reading your “money horoscope” might be entertaining, but it’s not going to get you out of debt! The missing ingredient in their financial rituals is the tactical knowledge needed to make real progress. It’s wonderful to feel good about your money, but it must be paired with practical action!
Mindful Money Management
If a practical financial expert and a magical money guru had a baby, it would be named Mindful Money Management. When we marry the deep understanding of the emotional side of money with the practical financial strategies, success is inevitable! This Mindful Money Management approach is baked into all of my teaching, coaching, and writing.
It’s important to uncover WHY we do what we do with our money, and then correct those negative patterns which keep us stuck in destructive behaviors. Yes, this involves exploring our past money stories, doing forgiveness work, creating vision boards, and writing positive money affirmations. Uncovering and fixing my client’s internal “money blueprint” is the first step.
Once I understand what my client’s emotional money triggers are, I then suggest practical actions to fuel their positive emotions and short circuit the negative ones. We create a personalized prosperity plan to accomplish their unique goals. Yes, this involves action checklists, using a spending app, and doing the homework.
The Path to Lasting Financial Dignity®
The path to lasting Financial Dignity® is this: bringing a deep understanding of the psychology of money together with useful financial strategies. This is the practical magic for your money! My clients are usually amazed by their financial progress when these two powerful forces are brought together. I’m wrapping up a coaching engagement with a couple who increased their net worth by $56,000 in the 6 months we worked together – wow!!
So, if you’ve followed either the practical financial experts or the magical money gurus with limited success, you’re not alone! It’s time to bring those approaches together and start mindfully managing your money!