Category: Self Development

Financial Literacy Tips for Self-Worth

Continued financial literacy notes from Financial Literacy and Mental Health

Hedonic Adaptation

  • Amount of money !== mindset
  • Money can change quality of life but does not impact well being
  • Happiness? See lottery winners

There is a lot of information out there now about hedonic adaptation and how we get really used to stuff. Dr. Laurie Santos’ popular Yale course The Science of Well-Being does a great job of distilling all the known research and applying the lessons to your life.

Basically, all our societal ideas about money is wrong. Money is just a tool, whereas society treats it like the actual end result. We know very well that money itself doesn’t bring happiness and even Silicon Valley billionaires subscribe to coaches and gurus.

Money does lift oneself up from poverty but after say all your needs are met, why need more. The mind very quickly adapts to a situation and then only wants more after that. It’s certainly a helpful driver to survival in the wilderness, but not so much in the modern world.

Essentially to thwart hedonic adaptation, find out your inner goal, the actual objective, that brings happiness to life, and relegate money as simply the bridge to that goal.


  • Labeling ourselves based on our finances
  • Where did I learn to speak to myself this way

Poor is a description of lacking money and it also describes inferiority. No wonder it really sucks to use it to describe ourselves. Other words like cheap and modest further define our relationship to money in a way that we also embody as an identity. Looking deeper into why we use labels for ourselves is a way to start unlocking our real motivations.

For the longest time I was a thrifty person and everything I did had to be within this weird continuum of old and used. Like I only shopped at vintage stores and was modest about my appearance. My furniture was all hand me downs and I relished in shabby chic. Then I just woke up one day that I was perpetuating my mom’s idea of what our lives were to be like in middle school. I virtually gave everything away and started from scratch.

False Narratives

  • Pay grade equals success
  • I’m not worth spending money on

The speaker suggested we combat false narratives like our self-worth by asking the questions below:

  • Where did I learn to be this way?
  • What leads me to believe this is even true?
  • Would I judge my best friend the way I judge myself?
  • What would I say to my best friend if they were going through this?

It’s obvious to me that my parent’s didn’t set the greatest financial example. Money was a chaotic instrument in the home. But that’s not enough to just know the source, I needed to look deeply at how I formed a relationship with it. I saw that thoughts of self-worth and fitting in transferred over to money. I deserved money but I didn’t deserve the joys that came of it. I didn’t feel belonging in the teenage world so what was the point of buying things.

I was harsh on myself and still am. Sure we need to save for retirement or a rainy day but I also place impossible standards on all of that. If I was serious I’d actually set realistic goals and work towards meeting them, understanding there is hope and possibility. This is how I’d approach a friend, I’d console them and show them a path forward.

Healthy Relationship with Money

  • Break down goals from large ones to small ones
  • Reward myself for my progress
  • What does Guilt mean? Speak to it, what would it say, create a dialogue
  • Dialectical: Two opposing beliefs can be true at the same time
  • Radical Acceptance: Accept money situation, neither good nor bad

The obvious approach with money or any large problem is to break it down into smaller pieces and work each one. Directing your focus on what is immediately in front of you is more effective than trying to juggle the entire plan all the time. Within those little sprints toward milestones, reward yourself for progress. I’m reminded of Before Happiness by Shawn Achor which details brain hacks related to rewarding oneself to cross the finish line.

Creating a dialogue with guilt was an interesting tip because I think of guilt as the symptom than the problem itself. But I can see it’s a key to understanding the original problem. Guilt from money feels displaced for me, meaning I can not see the original reason I would feel that way. Guilt implies that we’ve seen suffering and want to help but we didn’t and we’re drawn back to do something. If you feel guilty buying nice clothes, it’s not the clothes, it’s something about the clothes or related memory. Maybe an estranged parent who shopped like that, maybe body image. It could dive into trauma even.

I still don’t quite understand dialectical approaches to therapy but I suppose a dialectical approach to money is acknowledging opposing beliefs can exist and from there, developing a common truth or relationship between them. I have the urge to throw everything into the stock market but I also want to save money for a home. If approached as two opposing problems where one must win, I will be forever in conflict because there is no actual right answer. Yet society tells us there are a lot of must dos and must don’ts. A dialectical approach might say accept they are both true, so then how can they happen if so. Ok, maybe a home is more important to me so save money now and invest just a little.

The last takeaway was radical acceptance, accept a bad situation wholly and fully without judgement. No “it’s okays” here. Seems easy enough for losing your wallet, but if it isn’t, like a spouse gambling your savings away, then it’s quite radical to say accept the situation. For me, to understand radical acceptance is a way to gauge what my limits are for financial chaos and to plan for those contingencies.

Financial Literacy Tips for Mental Health

Apparently there is a whole field called “financial therapy” which focuses on the psychology aspects of money. I took a Zoom workshop from The Financial Diet and wanted to share my notes. There isn’t anything revolutionary, these are just basic life skills but for many who grew up in complicated households an always needed reminder. With pandemic lifting I think it’s a good time to revisit where our assumptions about money and the future are rooted in.


  • Adults have hard time budgeting because of growing up with financial distress
  • You never want to return to your younger poor self
  • Those who grew up around money now find it pointless to manage

Yes money was definitely a whirlwind of hell for me growing up. Not that it wasn’t around, it just was never predictable and seemed to manifest out of thin air even though most of the time it was scarcity. The immigrant family mindset around money is a constant contradiction between comfort and fire drills.

Financial Trauma

  • Bankruptcy or financial loss events
  • Usage of food stamps, financial aid, loans
  • Complex and intersecting events like divorce
  • Personal financial collapse events

Growing up there were big events from my parents where we thought we were on financial disaster whether that was intentional (gambling) or not (loans). While such events are not avoidable, the way they are dealt with can leave lasting scars. My parents were loud and reactive and so that passed into me.

Personally in my 20s after the second recession, I ended up in my aunt’s restaurant cutting green beans and serving Kung Pao chicken to people making real salaries. I thought all the smarts and talents and degrees I had acquired would make me bulletproof to anything. That’s not the real world!

Scarcity Mindset

  • Never enough money, defeated anxious to money
  • Never throw anything away cuz nothing comes to me
  • How much I should have saved dilemma (living in past)

I am notorious for living in the past and regretting poor financial decisions. After graduating college, I let an Italian model sell me a used “almost new” Corolla in a busted out roadside car lot in a “bad” suburb. Then I later found out it had a salvage record from Hurricane Katrina!

But the really dumb part was that I insisted on an econo car when there were plenty of sedans and SUVs in the lot at the same price. I was just focused on portraying how modest and environmental I was, and didn’t even care about the utility or practicality of the vehicle. Uber didn’t exist then but for example I could have helped people move.

Stressing on sticker price and bells and whistles are fallacies. A car is actually at the end of the day a tool.

Abundance Mindset

  • I can give this away and it will make it to someone else and something else will come back to me
  • Opportunities are endless
  • I am capable of giving and receiving

Abundance really comes up in shopping and bartering for me. Like at the end of the day, you saved $5 on a shirt or $20 on a table. Yes save money, find deals, but you don’t have to go all across town after days of research to purchase something that is consumable anyway. Time and energy is precious, protect that, instead of being stuck in seemingly life or death decisions at shopping carts.

I burned a good 6 months trying to find the perfect couch for my living room and I ended up spending more money and got the wrong one anyway. So there goes 6 months I could have just ended up enjoying the first couch I saw that fit, and already been on my next house project. Same went with the fact I was trying to Craigslist my existing couch for way more than it was worth, who cares, you got plenty of life and love out of it, let it go.

Building experiences is what I’m about, so when I think of needing to do a lot of purchases around a common theme, I will set budgets versus wrangling each item.