Money Mindset

Chapter 2 The Psychology of Money

In this chapter, you will learn how the ways we think about money can affect us positively or negatively.

Many of our attitudes about money are formed in childhood. These attitudes affect our behavior and actions throughout our lives, and even affect the outcome of our financial future. Many people discount or underestimate the power of our money attitudes in our decision-making and planning.

We have beliefs and attitudes about everything that is important to us in life. For example, we have attitudes about politics, religion, war, marriage, and, of course, about money. How can you have an attitude about money? Well, your attitude is what money means to you. How do you feel about money? How much does money influence all of your decisions in life (not just your financial ones)?

Simply, your money attitude is your way of thinking about money. And it can affect you negatively or positively.

Glenn D. Wilson, one of Britain’s best-known psychologists, once said, “Money evokes conditioned emotional responses. People become obsessive about money—it gives them a buzz like an addiction. It has commonalities with food, which might suggest an evolutionary origin for our craving. And money is more than just a means to an end. It prompts behavior that cannot be explained by its utilitarian value. People rolling in money still seek more of it, as though they can never get enough. They will sacrifice other values such as family and friends in favor of accumulating ...