Few of us get through life without some financial trauma, and for many, our money wounds are severe enough to become debilitating.
In 2017, a study reported in Forbes magazine found 1 in 4 Americans have post-traumatic stress symptoms from financial stress. This number inevitably worsened during the pandemic, although the data is not in yet.
For those folks who’ve suffered money trauma, I can relate. I’m still processing the emotional fallout from when our monastery went bankrupt — in 1999. Those wounds don’t mend quickly and can trap you in an endless loop of negative thinking.
There are no quick fixes for financial PTSD, and you’ll likely need professional help to rebuild a healthy relationship with your money. However, one small trick that helps with my financial anxiety is to give my money a pet name.
I know it sounds a little silly, but it helps me put sound financial principles into practice and stop being triggered every time I look at my bank statements.
I call my money KP. Kitty Puss Rex (or KP) was the enormous Russian blue cat who lived in our monastery for 22 years. He was one of the most loving, affectionate and attentive pets I’ve ever known.
When I’d come home from work, KP would be at the door waiting for me every day, and he wouldn’t leave me alone until he got a serious snuggle. His favorite trick was to jump up on my shoulders, drape himself around my neck and nuzzle my ear while purring loudly.
Sadly, he passed away years ago, but I named my money after him — KP is my primary checking account’s name. Can I neglect KP? Can I be angry at KP? Can I hate KP? Never. He may claw the furniture and cough up a hairball on my pillow, but that’s just how KP rolls.
With KP, there is no anger, no judgment and no shame.
We’re old friends, KP and I, and we take care of each other. I look after KP, and he looks after me. Having a good friend is a blessing, and when you build a healthy, friendly relationship with your money, you’ll be happier, healthier and more in tune with all the other blessings in your life.
But to overcome your financial trauma, you must also set clear boundaries with your money, just like with a pet. Let me show you an example from KP, the cat.
Have you ever heard a rabbit scream? In Santa Fe, as the locals know, we have coyotes. And big jackrabbits. When the coyote packs travel through the arroyos, you’ll sometimes hear them catch a rabbit. That’s when a rabbit screams — as it becomes a coyote snack. It is an ear-splitting, blood-curdling cry.
The haunting sound of a rabbit’s scream is unforgettable.
The real KP was a master escape artist and always wanted to run outside and play in the arroyo. It was hard to tell him no and drag him back inside when he’d sneak out. I know he just wanted to play, but I had a duty.
Cats can’t live outdoors here, or they become coyote snacks. We also have fleas that carry the bubonic plague. (Yes, the plague still exists.) A friend lost both his legs from amputation when his dog brought plague-ridden fleas into the house.
KP desperately wanted to run wild every day. But it was my job, out of love, to say no. I had to set boundaries and make KP live by them, especially when he didn’t want to. If I didn’t, this extraordinary, loving creature would either disappear or literally bring in the plague and destroy our family.
That’s an excellent analogy for money.
Those suffering from financial PTSD tend to let their money run wild or allow it to become a toxic plague.
To slowly start building a healthier relationship with your money, you must give it love by setting strong boundaries and practicing prudent financial discipline.
And remember — the coyotes are hungry.
Doug Lynam is a partner at LongView Asset Management in Santa Fe and a former monk. He is the author of From Monk to Money Manager: A Former Monk’s Financial Guide to Becoming A Little Bit Wealthy — And Why That’s Okay. Contact him at firstname.lastname@example.org
The information contained herein is intended to be used for educational purposes only and is not exhaustive. Diversification and/or any strategy that may be discussed does not guarantee against investment losses but is intended to help manage risk and return. If applicable, historical discussions and/or opinions are not predictive of future events. The content is presented in good faith and has been drawn from sources believed to be reliable. The content is not intended to be legal, tax, or financial advice. Please consult a legal, tax, or financial professional for information specific to your individual situation.
This content not reviewed by FINRA