Are your finances a mess? That's curious.

When it comes to money, most of us have a problem-solution mentality. Got debt? You need a plan to get out of it. No savings? Here's a way to budget your way to a fatter balance. Hate to review your accounts? Try the butt-in-chair method.

The limitation with this approach is that most financial goals involve a significant amount of behavioral change, and slapping that "problem" label on yourself means you are probably going to overlook the very insight and information you need in order to change.

Instead of problem solving, try to cultivate an attitude of benign curiosity about you and your money. I say benign curiosity, because when we first start to simply pay attention to money it can bring up a flood of negative emotions and beliefs. We need to be conscientiously gentle and kind to ourselves, or the practice of self-examination feels overwhelming.

Benign curiosity begins with two important premises:

All financial behavior has meaning.

All financial behavior serves a purpose.

So if, when you start paying attention to money, you notice that you've been making a lot of impulsive purchases, try to step back from the self-recrimination for a moment and remind yourself:

I may feel regret about these purchases now, but at the time there was a reason why I felt I had to buy X. What was I trying to do, change, or fix? In what way did that work? In what way did it not?

Benign curiosity allows you to identify the true cause of the behavior and find positive, affirming ways to meet that need that aren't financially destructive. This way when the moment comes again you A) recognize it, and B) have an alternative response ready.

As someone said in one of my groups last night, "It's easier to change a habit than to eliminate it."

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Treating is Fundamental

This morning I gave a talk to the graduating seniors of a prestigious arts college. One of the questions I got asked was how to deal with wanting to treat yourself. "I work so hard," the young man said, "and I feel like I deserve to spend money on something nice for myself once in awhile, even though money is tight."

As far as I'm concerned, you should be spending money on nice things for yourself all the time. I am not the treat police. Completely the opposite, in fact. I feel like meaningful treats** should be part of EVERYONE'S regular spending plan. But treating yourself has little to nothing to do with how hard you work, and everything to do with whether or not you have the money to afford your treat of preference.

When you try to buy yourself a treat that you can't afford just because you "deserve" it, you end up in a mental spiral:

Prosecution: "Do not buy those shoes! You will just go into more debt!"

Defense: "I deserve these shoes! Wait, I NEED these shoes. My other shoes are worn out and scuffed, the heel is broken, and I never have any nice shoes to wear when I have to go out."

Prosecution: "When you have to go out? Really? That's your defense? Maybe you want to try again."

Defense: "Whatever. Work has been making me crazy. I hardly ever buy myself anything. I should get myself something nice once in awhile. Besides -- these are on sale. It would be a waste of money not to buy them!

Prosecution: "Your Honor, the Defense should recuse herself because she is starting to sound insane."

Defense: "Ha! While you were talking to the judge I snuck up to the register and paid for them! Too late!"

And later... the "Defense" is nowhere to be found as you mope about, feeling ashamed that you spent money on shoes that you meant to put toward paying down debt. You're still tired, anxious, and overworked, but now you get to feel guilty and regretful on top of it. How is that a treat?

Buying something on impulse that you can't afford and telling yourself you deserve it is a self-esteem grenade.

A real treat starts with a plan. You think about what would be a meaningful, enjoyable way to spend money on yourself. If it's shoes, great. Or it could be going to the movies, meeting a friend for dinner, or buying fancy bath salts. When you know what it is you want to spend money on, revisit your monthly spending plan. Put said treat item into the plan. If you need to, pare back other expenses that are not as valuable in order be able to afford it. If things are really lean, see if you can identify what it is about your preferred treat that makes it so meaningful, and then try to find a lower-cost alternative (for movies, see if you can set a date with yourself to watch a movie at home with a favorite snack and no interruptions, or for fancy bath salts try mixing your own).

When you consciously and deliberately give yoursef a treat you get to enjoy every part of it: the dreaming, the planning, the selecting, purchasing, and using. Using money as a means of self-care can be an amazingly empowering experience. And THAT can be the real treat!

**For our discussion here, when I say "treat" I specifically mean SPENDING MONEY on something fun, indulgent, or frivolous. I don't just mean doing something nice for yourself.

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National Teacher Appreciation Day

I was always a geeky kid who loved school, so it's no surprise that I can name ten teachers off the top of my head to whom I feel grateful and who I think about with great affection. But hands down, the teacher who had the most significant impact on my life was never my teacher in any particular class, but the teacher who ran our drama and forensics department. She was my mentor, coach, director, and friend.

Kathy Mulay was a perfectionist. And she could be tough. When she cast me in our senior year production of The King and I, I went through a period of rehearsals where I was intimidated to sing in front of the girls playing the King's wives because I thought they had better voices than me. Kathy (Mrs. Mulay then) took me aside and didn't reassure me. She didn't give me a pep talk. She told me that the part was mine and I needed to "get it together." She was the director, she knew what she was doing, and she had given the part to me. It was time to deliver. I remember my blood turning to ice when she dropped this on me. But in the next second I knew I had to deliver. So I delivered.

My decent-but-not-fantastically-exceptional performance as Mrs. Anna aside, the area where Kathy really changed my life was as my forensics coach. Forensics, or competitive public speaking, is not the coolest way to spend Saturday mornings when you're in high school. But for some reason I loved it. I loved to write, edit, and endlessly rehearse my pieces in hopes of winning a trophy. And Kathy would work with me for hours into the evening, choreographing each cross of the room, each hand gesture. Under Kathy's direction I went to the state finals two years in a row, competing my junior year in Informative and senior year in Oratory.

Can you think of a better gift to give someone than the ability to craft and deliver a message that others can understand, and believe? I use these skills every day when I teach classes, lead workshops, and speak at events. I feel so lucky that I can take my passion for helping people bring money into balance and communicate it to as many listeners as I can muster. I never feel nervous in front of a room full of people. I get excited! I know that what I have to say can make lives better, and I don't have to worry about my ability to say it. When I consider that public speaking is one of the most common phobias, I cannot even express my gratitude for what Kathy Mulay has given me. But still I will take this opportunity to say it: Thank you, thank you, thank you, Mrs. Mulay.

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Princess, Post-Doc, Publisher, Mom?

As the mother of two daughters, I want my girls to have dreams as big as the world. Fighter pilot? Astrophysicist? Go get 'em, girls. And yet one of the things that I love most about my own career is that I can organize my schedule to include a lot of mommy time. Half of the week I get home after the kids are in bed, but the other half I can cuddle the baby all day and be there to pick up big sister from preschool. Being a hands-on parent is a priority for me, but it does make for some hard choices when it comes to certain professional opportunities.

The balance that I've created is in large part due to the messages about work, family, and earning that I got from my own mother. When I was younger my mother was a teacher. She enjoyed her work, but even more importantly her career enabled us to survive those years when she was the custodial parent after she and my dad split. A few years later she remarried and continued to teach for awhile, but with a longer commute, another child, and a busier household the main message that I got from her was that it is very hard to be the mother in a two job, two kid family. As soon as we could afford for her to leave full-time work she did, and I remember that there was a lot less stress in the family when she was able to focus on home.

Reading this piece about the "princess mentality" by Amanda Steinberg and referencing an earlier op-ed by Laura Vanderkam, I can't help but think of how complex (and wonderful!) our choices are as women. I am so glad there are voices like Amanda's and Laura's that urge us as women to protect ourselves, to participate in own own financial lives, and to never depend on someone else for our own security. I agree wholeheartedly. There is absolutely no job security in being a princess nowadays.

But while that's undoubtedly true, it's still not exactly simple. My mother also encouraged me to dream big. Fighter pilot and astrophysicist were actually things I wanted to be when I was growing up, but as I got older I pivoted to something decidedly more family-friendly. I'm lucky that I am actually doing work that I adore, and pursuing a career path that fulfills me just as much as being a parent. But do I feel like I threaded the eye of a needle in doing so? Absolutely. And I wonder what message I'm modeling for my girls, even while I tell them to shoot for the moon.

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Huh? (Seth Godin edition)

I've now read this very short post four times and still find myself scratching my head.

When people have their basic needs met, it's not uncommon for wants to magically become needs. It's our hardwired instinct to seek to fill unmet needs.

That pays off for any marketer that has persuaded his market that they need what he sells. It backfires when those 'needs' are seen for what they actually are--luxuries.

When you sell a want, you have to work harder, you must seduce the market, because wants are fickle, picky and not easily bullied.

So is Seth (we're on a first name basis) saying that in this case wants have the same perceived urgency as needs, or is he saying that they are in fact more superficial and thus hard for marketers to engage? It seems like if a consumer experiences a want as a need, he or she would be pretty receptive to a marketer peddling a solution for that "need."

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I Ain't Sayin' She's a Golddigger

Hey, fellas, have you been feeling left out of my recent glossy mag advice-a-thon? Read this article from the May issue of Men's Health where I suggest ways to handle such sticky conversations as your parents' inheritance plan, who pays for dates, and different levels of ambition between spouses.

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Couples Counseling: You and Your Money

Sometimes in my financial counseling practice I feel like a couple's counselor, rehabilitating the relationship between people and their money. (This is, of course, notwithstanding the many actual couples that I treat around money issues. That's a whole other can of worms.)

Sessions can go something like this:

Client: "Make my money stop disappointing me!"

Money: "Make her pay attention to me!"

Client: "Every time I try to spend time with my money, it's never enough. My money is all complicated and needy and it doesn't give back to me. It doesn't take care of my needs. It's all, 'Hey, why don't you keep better records? Didn't you notice that this bill was late and you got slapped with a fee?' I work all day long, and when I get home I just want my money to be waiting for me with orderly accounts and a fat balance! Is that too much to ask?"

Money: "You are acting like a crazy person. No, I cannot organize myself. I can't do anything you don't instruct me to do. I am an inanimate object. Quit projecting your relationship with your mother all over me and just hang out with me once a week! I'm not trying to stress you out. I'm just trying to get your attention because there are things that need to get done!"

What I basically do is what any couples counselor would do: try to bring down the emotional intensity and facilitate communication such that both parties can actually hear each other (okay, really it's only one party that needs to do the hearing).

What clients need to "hear" is their own anxiety. Anxiety has a vital function, and that is to bring our attention to something that needs to be addressed. It's designed to be uncomfortable so that we're motivated to remove its cause.

When we yearn for money to take care of us with no responsibility or action on our part, we're enacting an infantile fantasy. In essence, we put money in the role of a parent whose job is to provide unconditional care and support. For many people who struggle with this financial issue the root cause is a parent who did not do that job sufficiently.

The financial counseling process can help clarify and resolve where money gets tangled up with personal struggles such as this. The "dialogue" above seems silly from the perspective of adulthood, and sometimes just pointing out the dynamic can be enough to help people recognize the impossible expectations they have for their financial life, and to begin to build a solid and mature relationship with money.

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Amanda's Metaphors of the Week

Metaphors are a great way to help people gain new understanding by drawing a parallel with something already familiar. I love metaphors and use them all the time in my coaching work. I'm usually coming up with them in the moment, so sometimes I go a little off the beaten path. Here are some metaphors I've thrown out just this week. Note: it's only Wednesday.

Developing a new financial management practice is like sculpting a figure from stone. You don't jump right in and chisel out the finer details of the face. First you grab a hammer and just whack that stone to try to get a rough shape. After that you refine. But first you're just taking whacks with a hammer. It's not supposed to be perfect.

Money is a neutral energy source. How we direct it reflects our own inner meaning.

A money crisis can bring attention to financial behavior that's been limiting you for years. It's like that compressed disk in your back. Your range of motion has been curtailed for so long you don't even remember what it's like to move freely. This process is like going to the chiropractor. We're going to adjust some things so the behavior will unlock and release.

Our biases and distortions around money are uniquely personal, sort of like your own individual glasses prescription. You may be a +2, the person next to you a +1.25. But this is the distortion each of you brings to how you perceive a financial situation, and with awareness you can learn to correct for it just like you can get corrective lenses.

You say that you have two options right now: to sink or swim. I suggest we add a third: to float. Let's just take moment to pause and gather information before we decide what needs to be done about it. We're just going to float here on the surface, noticing all the parts of the landscape, and take it all in before we feel we have to do anything.

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The Savings Burden

I'm a behavioral economics junkie. I can lose a day reading Kahneman, Ariely, or Benartzi. Helping people overcome cognitive biases and behavioral defaults in order to take care of themselves financially is my life's work.

But sometimes I feel like we forget about the external forces that also support or impede financial goals. The conversation tends to take a decidedly "red state" (personal action and responsibility) or "blue state" (political/macro-economic framework) focus, and we lose the interplay of person-in-environment, which is the "unit" we are taught to examine in graduate social work programs.

I do some work with a non-profit that is in the process of freezing their pension program. To compensate, they are offering employees a 401(k) match up to 6%. In many companies and industries this would hardly cause a ripple, but for people who are already trying to live on a social worker's salary in one of the most expensive cities in the world, this is a huge challenge.

We can employ as million "opt-out instead of opt-in" tricks to get people to contribute more to their 401(k)s, but let's not overlook the great number of people who struggle to save not because of loss aversion, but because they have barely enough money to cover their essentials.

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The Automated Life

I was reading a post by new Twitter friends oXYGen Financial (@oXYGenFinancial) about the pros and cons of putting bills on autopay, and I thought I'd contribute my two cents.

Our money takes us on a journey. Some parts of that journey are interesting and worthy of exploration, other parts are simply scenery that we pass by on our way to somewhere else. Putting bills on autopay puts them in the scenery. Which has advantages - do you really want to be examining every tree and mile marker? Not only could that get pretty dull, but it could also take energy and focus away from other parts of your financial life that would benefit much more from getting your attention.

When coaching people on developing financially healthy behaviors, I tend to start with a thorough examination of all expenses. Each expenditure tells us something (my mantra is "All financial behavior has meaning," and what you spend money on reveals a tremendous amount about you). So yes, I want to know why you chose that cable plan, or why you live in that apartment. I've been known to get lost in the story of when you stop for coffee. When you're at the beginning of the financial wellness journey it's not just every tree and mile marker, but even the blades of grass get at least a cursory glance.

However, there is competition for your attention, just like there's competition for your money. So after we get a sense of which budget elements need attention and which ones do not, tools like autopay can be immensely helpful. Not only does this feature have the benefits listed by oXYGen, but I would add that you can also avoid late fees and the anxiety of wondering if you've paid something on time. Creating a greater sense of safety around your daily finances frees you up to start working on deeper-level issues.

Automating a spending activity de-prioritizes it in your consciousness. That's fine (again, given the potential drawbacks so excellently listed by oXYGen), but it's not fine if that spending behavior becomes completely unconscious. A routine review of charges helps you keep perspective on what your choices cost. It also gives you the opportunity for a quick check-in that this expenditure is something you continue to value. I can't tell you how many thousands of dollars I've helped people save when they discover a mountain of subscriptions, dues, and other fees they didn't even know they were still paying, or when they pause to notice their Netflix payment despite the fact that they've been holding on to the same three DVDs for six months.

A huge part of financial wellness is learning how to pay attention to money. But attention is a precious resource, and figuring out the best places to apply it is an art. How does autopay work (or not work) for you?

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Katie, You're Doing it Right

I was thrilled to read Katie Karlson's DailyWorth piece today about jump-starting her savings account using her tax refund. For those of you who struggle to put money aside out of your paycheck, a tax refund, birthday gift, or other such windfall can be just the ticket to help turn you into a super saver.

Successful saving is a habit, and all good habits need a reward if they're to continue. The huge rush that we get from seeing a four-digit increase in our savings balance can trigger a desire to do more. In Katie's case, she doubled her monthly auto-transfer to meet her savings goal even faster.

The other smart thing Katie did was to have a specific savings goal. She's moving this summer, and wants to make sure she's financially prepared.

In order to reinforce her new saving behavior, I would recommend that Katie keep close tabs on exactly how each dollar saved contributes to her progress. For example, if she knows that renting a U-Haul truck will be $1,000 and she needs $2,000 to cover deposits and fees on her new apartment, she should regularly look at her account balance and say to herself,"I've got the truck covered now and I'm almost halfway there on fees and deposits. In x weeks I'll have enough saved to cover all of those costs, and if I really work hard and save an extra $75 in the month before I move, then I can afford to buy some pizzas and wine for my friends to bribe them into helping me unpack!"

Katie, here is what you're doing right:

• You have your goal in place even before you've figured out all the details of how to make it happen (the order goes values -> goals -> tactics);
• Your goal is specific, positive, and actionable;
• You maximized your dollars AND reinforced a good financial habit all in one fell swoop;
• You protected yourself from going into debt due to a foreseeable event;
• You paid it forward and helped improve your own positive support network by inspiring your co-worker to save more, too.

Way to go, Katie!

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Getting the Debt Ceiling off my To Do List

I was going to write a post today about the Debt Ceiling debate, but then I read Ramit's piece and decided to save myself some time by simply pointing to it and saying, "Yeah, what he said."

The highlights? Don't freak out. Don't do something stupid with your money just because your anxiety makes you feel like you have to do something. Think long-term and don't get distracted by (potential!) short-term events:

Yes, it’s possible the government could default, or the stock market could tank overnight…but it’s more likely that very little will happen in the short term. So would you rather focus on the 0.05% chance…or the 99% chance?

Thanks, Ramit! Now that that's done I can get back to compiling all of our current account statements for our new financial advisor. Yes, seriously -- that was my other To Do this morning. Thanks for the reminder!

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