I recently had a fascinating conversation on the podcast with personal development trainer Michelle Masters. We talked about the deep, often hidden psychological forces that drive how we handle our finances. That discussion struck such a chord with me that I decided to record a solo “10 Things” episode to unpack the emotional and psychological underpinnings of behavioral finance.
What I have learned over the years is that our financial outcomes have very little to do with math. They have everything to do with how our brains process fear, safety, and self-worth.
Here is a sneak peek at the ten core insights I break down in the new episode.
1. Behavioral finance is about the mind, not the spreadsheet. We often convince ourselves that building wealth requires complex calculus. The truth is that the numbers are actually quite simple. The real hurdle is the human mind, which constantly pushes us to make emotional mistakes like buying high and selling low.
2 & 3. Our money behaviors are intimately tied to trauma. Bad financial decisions rarely stem from a lack of intelligence. They are usually coping mechanisms built around childhood wounds. That trauma generally comes in two flavors: lived and generational. I experienced lived trauma when my father died. I was seven years old, and I watched my mother constantly worry about money after his passing. Even though I am now wealthy and financially independent, that experience left me with enduring anxiety around spending.
Generational trauma, on the other hand, is passed down through modeling or even epigenetics. My grandmother was an orphan during the Great Depression who hoarded food and money. She passed those scarcity behaviors down to my mother, who then modeled them for me.
4 & 5. Your mind will drive you to extremes. A spreadsheet will not lie to you, but your brain certainly will. A negative mindset can shut down wealth accumulation before it even begins. Take children of divorce who saw their parents use money as a weapon of manipulation. They often grow up believing money is inherently evil and compulsively spend it as soon as it hits their bank accounts.
On the flip side, an anxious mind can trap financially independent people in an ultra-conservative scarcity mindset. They obsess over lowering their safe withdrawal rates and agonize over losing Social Security. This completely prevents them from using their wealth to live joyful, well-adjusted lives.
6. Getting good with money often requires therapy. Because childhood coping mechanisms are deeply ingrained in our subconscious, they are incredibly difficult to fix on our own. Think of your mind like a building. Sending experts to the penthouse to fix an electrical problem that is actually located in the basement will never work. To resolve subconscious money blocks, you have to go down to the basement through professional therapy.
7 & 8. The double-edged sword of financial advisors. If you are unable or unwilling to work through your trauma, handing your portfolio to a competent advisor can act as a great stopgap. A good professional will keep you from making impulsive moves during a market downturn. But remember that advisors are human too. During severe market panics, some lose their cool out of fear of losing clients and actually allow investors to sell at the absolute bottom.
9 & 10. The ultimate weapon is a written plan. We spend far too much emotional energy on money. Yes, it is a necessary tool to support basic life functions. But treating it as the ultimate goal, a measuring stick, or a definition of our self-worth only breeds anxiety and actively destroys our happiness.
One of the best weapons you have to fight this is a written financial plan. Drafting a clear, long-term plan when you are calm and the market is quiet provides a critical lifeline. It helps subtract your temporary emotions from the equation when market turbulence or personal anxieties inevitably strike.
I dive much deeper into all of these concepts in the latest episode. If you have ever felt like your brain is working against your bank account, you will want to tune in right now.
Community Update: Coaching and The Happiness Code
I want to share a quick update with you regarding my purpose-oriented coaching. I am currently raising my prices from $1,500 to $2,000 for a package of five one-hour Zoom sessions.
However, I am offering a special discount to listeners right now to help promote pre-orders for my upcoming book, The Happiness Code, which is slated for release in March 2027.
If you purchase 50 paperback copies of the book on Amazon (which costs roughly $1,000) and email me the receipt, I will give you the five-pack of coaching sessions for free. This essentially gives you the coaching at half price, plus you get 50 books to share with your friends, family, or colleagues. It is a true win-win.
Let me know what you think of the new episode in the comments!
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