Psychological Money Sense

Tax Day 2015 = over (for most).  Whew.  Ready for some ways to boost your buck?

Would it surprise you that your emotional well-being really doesn’t improve by becoming wealthy?  There’s been a host of research in recent years that look into happiness and money.  Possibly the most commonly known one is theNational Academy of Sciences study on well-being and money.

This study’s now famous $75,000 mark suggests that a person’s emotional well being (how they feel day-to-day) AND their evaluation of life (their overall perspective of how they are doing) improves up to the point of earning $75k per HOUSEHOLD in the United States.  Beyond this mark, emotional well-being doesn’t significantly improve, though a person will evaluate their life as better if they earn beyond this mark.  To quote their findings, “We conclude that high income buys life satisfaction but not happiness, and that low income is associated both with low life evaluation and low emotional well-being” (Kahneman, et al. 2010).

So what do “happy money” spenders do?  Research by Elizabeth Dunn and Michael Norton in Happy Money: The Science of Happier Spending (2014) reveals how money is spent makes the crucial difference in happiness.

  1. Buy Experiences.
    • Connect with people; target experiences over stuff.
  2. Make It A Treat.
    • Making something special and novel increases its enjoyment.
  3. Buy Time.
    • Make time to slow down and pursue what’s valuable to you.
  4. Pay Now, Consume Later.
    • First, don’t consume with money you don’t have.  Second, enjoy at a later point- anticipate.
  5. Invest In Others.
    • An incredible thing happens when we give: happiness.  “It is more blessed to give than to receive” (Acts 20:35, The Bible, ESV).

Looking for ways to understand this deeper?  Check out the links below.  Are you making the most of what you have?  Are you caught up in materialism and consumerism?  Today is always a great day to do something different.  Money is one of the many areas covered in my holistic approach to counseling.  Feel free to reach me to find out how hope and change might occur through professional counseling.

Yours Truly,

Justin K. Hughes, MA, LPC


Money Psychology


The holiday season is coming to a close.  2014 is upon us.  If you are like most Americans, you have spent a fair amount of money in the past month.  Whether consciously or not, you have made a substantial number of financial decisions.

How much did you drive?  What did you spend on food?  What led to the purchasing decisions you made?  What brought about changes or continuity in how you spent money?  How are you planning to spend or save in the next week?  What are your goals for next year?

These are all money questions.  Whether we like it or not, it is integral to daily life.  Even right now, as I type, I am using electricity, wearing down the life of my computer, using time, and re-educating myself on decision-making.  This all affects money.  And money affects it all.

Money is neutral.  Good or evil can come from it.  It is a great tool to reveal what is important to us, and it will quickly reveal the true investments of our hearts- what matters to us.  So when I work with couples and individuals dealing with relationship problems, it’s no wonder that this is a regular dispute zone.

In The 5 Money Personalities, authors Scott and Bethany Palmer present 5 personal styles to handling money.  We each have styles, just like we have personalities- equal, yet different.   There are strengths and weaknesses in each style.  How a person comes to the table- their beliefs and attitudes- considerably impacts their actions and emotions.

First of all, the Spender gets a genuine rush from spending- big or small.  This type of person lives and breathes in the moment- seeking to make life enjoyable now and create memories.  Spenders love to buy for others and get much happiness from helping others and giving gifts.  However, impulsive decisions, a tendency not to communicate about money, regret, and sticking to a budget are some unhelpful results that can ensue.

For the Risk Taker, risk brings a thrill, a challenge, a joy.  They will think about the big picture.  Entrepreneurial possibilities are their life-blood.  The hunt invigorates- and this person moves quick.  Instead of looking at the data and following a standard path of conventional wisdom, their gut is often consulted.  Conversely, vulnerability to loss, ignoring reality, impatience, and a lack of empathy are some of the risks that can follow.

The Security Seeker is a researcher.  Just like the motto of the Scouts, they live by Be Prepared.  Future focus allows them to be willing to give up on immediate gratification for long-term gain.  Faithfulness with resources is an almost inevitable outcome.  The down side is the tendency to be negative along with having anxiety, possibly becoming a killjoy, getting stuck in analysis, and lacking in creativity.

The Flyer may seem out of place in a discussion on money- they hardly think about it.  This person is not consumed or obsessed with money.  They are content, centered on relationships, and usually not motivated by dollars and change.  The flyer may not pay enough attention to money, make decisions based on emotion, lack money skills, or lack in responsibility and initiative.

Finally, the last money personality the Palmer’s introduce is the Saver.  They love to, well, save.  Getting something for less is exhilarating to them.  Organization and stability are this person’s namesake, avoiding debt and calculating buying decisions.  On the contrary, financial goals can lead this personality to lose sight of the present, form anxieties around plans, goals, and saving (which can be not-so-fun), and they may also be just plain cheap.

Exciting, huh?!  This knowledge can certainly help understand the motivations and drive behind money decisions.  Many people, though, are like John and Kate, who approach money in very different ways.  When everyday decisions arise, they quickly get into conflict because they assume the other person is ignoring their needs and not being helpful.  The more a person is “vilified” for their style, the more they will shut down.  You (and those around you) will benefit if you learn to appreciate the person and personality without treating them like a villain.

Here is the thing: changing behavior- not just observing it- is the challenging task.  You will be successful in your relationships if you can really listen, show understanding and respect, and give generously.  Let money be your servant, not your master.  And when you handle money this way, will you ever look back and regret it?

Yours truly,

Justin K. Hughes