9 Steps To Financial Freedom - Step 1

 

 

SEEING HOW YOUR PAST HOLDS THE KEY TO YOUR FINANCIAL FUTURE

 

THE ROAD TO financial freedom begins not in a bank or even in a financial planner’s office, but in your head.

It begins with your thoughts. Your Mindset

And those thoughts, more often than not, stem from our seemingly forgotten past with money.

I’ll go so far as to say that in my experience, most people’s biggest problems in life—even those that appear on the surface not to be money related—are directly connected with their early, formative experiences with money.

So the first step toward financial freedom is a step back in time to the earliest moments you can recall when money meant something to you, when you truly understood what it could do.

When you began to see that money could create pleasure—ice-cream cones, merry-go-round rides; and also to see that it could create pain—fights between your parents, perhaps, or longings of your own that couldn’t be fulfilled because there wasn’t enough money or even because there was too much.

When you first understood that money was not just a shiny object or something to color on.

When you understood that money was money.

I want you to think back and see that your feelings about money today (fearing it, enjoying it, loving it, hating it) can almost certainly be traced to an incident, possibly forgotten until now, from your past.

SUZANNE’S STORY

 

Suzanne came to a financial planner for the same reason that brings many people—she didn’t want to deal with her money. Her earliest memories about money helped explain why. She had learned that what money buys is nothing compared to what it takes away.

It would have been the very end of first grade. My father said, “How would you like to go live on the Great Lakes?” I didn’t even know what great lakes meant, but I said no, I wanted to stay in Virginia, where we were. He said too bad, we’re moving anyway, but that it would be great because we’d have more money. The moving truck came and that was that. All my friends were waving from the driveway, and I remember just sobbing and sobbing as we drove away. My father kept getting promoted, so we had to move every year, sometimes twice a year, and the reason was always more money. It was so hard in the new schools. My clothes were never right, and kids would laugh at my accent, whatever it was that year. The teachers would teach the subjects in all different ways—old math in one school, new math in another. Plus I had to make new friends each time; by the time I’d made them, it was time to go. It was hard on my mom, too. By about the tenth move, she stopped unpacking half the dishes—what was the point? They’d just have to be packed up again.

Most of us leave a cluttered paper trail marking where our money went behind us, but Suzanne was unlike any other client I’d ever had. She had no debt. She rented a furnished house: no mortgage. She leased her car. She had no savings, no investments. Divorced, with one son, she had come to see me about putting aside money for his education. I saw a woman alone with no money for emergencies, or tomorrow. I could have said to her, “Now, Suzanne, see here, you are forty-three years old and you really must start investing for the future.” But clearly she knew that, and clearly knowing it made no difference at all to her, at least on the level that inspires us to take action.

Suzanne was still living as if she might have to move the next day—no commitments, no ties, no furniture, no complications to undo if she suddenly had to pull up stakes. She had turned her childhood message around and had come to believe instead that to keep away from pain, you keep away  from money.

 

ANDY’S STORY

 

If you’ve lost it all, how can you think you have the power to keep money safe, let alone make it grow?

When I was about eight, my mother gave me ten dollars to go to the bakery to buy bread. My grandparents and cousins were all coming to lunch, and this was a big deal. It was the first time that I got to go all the way by myself—down the block, to the right, then across the street all by myself, and down one more block to the corner. I’d been that way a million times, but never all by myself. And ten dollars! It was an enormous amount of money. Mom told me how much the bread would probably cost and told me to keep the change in my pocket. There was all this trust in me, all this responsibility. And what did I do? Lost it, the ten-dollar bill. When I got to the bakery: no money in my pocket. I had no idea what could have happened to it, no idea. I was late getting home; I looked everywhere. My grandparents and cousins were already there when I got back; everyone was in the kitchen; there was the noise of everybody talking. “Where’s the bread, Andy?” my mom said, and I had to say I lost the money. The room grew so quiet, you could have heard the pin drop. Nobody said anything; they were all just looking at me. I didn’t get punished or anything. I think everyone knew how bad I felt, and there wasn’t anything anyone could do. We had our lunch with the bread basket on the table but without the bread.

When he and his wife, Leslie, came to see me, Andy said, “I was so overwhelmed by that loss, I think I never wanted to be in control of my money after that.” Leslie had never heard his story before, and even Andy had forgotten about it until we did this exercise together. But after Andy told the story, everything started to make more sense for both of them. They had come to me to talk about investing for the future, but the two of them could never agree on the kinds of investments they should make. Most of these disagreements ended up with one or the other of them storming out of the room, to the point where they decided they needed professional help. Leslie wanted to invest aggressively; in their early forties they were young enough, she felt, to take some risks. Andy, on the other hand, was adamant about putting the money into a bank account, where, he said, “it’ll be safe.” He never understood why investing scared him to death until he made this connection to his past.

 

CATHERINE’S STORY

 

I remember when my twin sister and I were seven, and we both asked for bikes for our birthday. I could already ride one, and I wanted to tie a balloon to the back wheel and make it sound like a motorcycle as I sped through the neighborhood. That’s what all my friends had done with their bikes. But my parents made a huge deal of it, said that bikes were too expensive, maybe we could just share a bike. Well, I didn’t like that idea so much. I wanted my own bike and told them so. They told me—in a very loud voice, I might add—that I was being so selfish, that all I cared about was what I wanted, and that I didn’t deserve a bike at all. I didn’t know bikes were expensive; everyone else had a bike, and I just wanted a bike. Who knew? The morning of our birthday, there in the driveway were two bikes, one with pink streamers and one with white. I was so excited, I could not stand it. I immediately put a blue balloon on the back tire, and off I went. As I rounded the first corner to go around the block, before I knew it I was flat on the ground with my bike on top of me. I tried to get up, but my arm would not move. I can remember lying there, screaming for my mom to come help me. For the next six weeks I had this big cast on my arm. And all I could think was: This is what happens when you get something you’re not supposed to have. After my arm healed, I never really rode my bike again.

When I met her, Catherine was still living her life as if she did not deserve to have anything she wanted. More than anything else, she wanted to buy a house in the town where  she was a  teacher in a fine

private school; she wanted to start a garden. She even had a particular house in mind, she had the money saved for the down payment, but she couldn’t bring herself to make an offer. It was as if she felt afraid to take up any space in the world. She didn’t know why she felt so paralyzed, until together we went back to her first money memory. For Catherine, the bike episode popped up right away, although she hadn’t thought about it in years. She began to see that the seven-year-old she had been had every right in the world to ask for a bike, and that the pain of her broken arm wasn’t punishment for her desire

 

Money Messages

 

Messages about money are passed down from generation to generation, worn and chipped like the family dishes. Your own memories about money will tell you a lot, if you take that step back and see what those memories taught you about who you were—and whether  those memories are still telling you who you are today.

For me, the first message I remember came when I was eight or nine. In the hot Chicago summers, all of us in the neighborhood would go to the Thunderbird Motel to go swimming. It was heaven, jumping into the cold water of that crowded pool, everyone screaming. It cost a dollar to get in. One Saturday, as usual, I said to my mom, “Can I have a dollar to go swimming?” And she said, “Suze, I’m sorry, we don’t have it.” I said, “But Mom, I need a dollar to go swimming with everyone else,” and she said, “Sweetheart, this is very hard for me to say, and we don’t want anyone else to know, but I just don’t have a dollar to give you.”

I could tell that saying this to me made my mom want to cry. I also knew I was not to tell anyone. I felt as if the wind had been knocked out of me. What was I going to tell my friends? I don’t remember what I told them, but I do remember this: I suddenly felt I was different from my friends, that I had less than they did, and therefore they wouldn’t like me anymore.

I’m not proud of what happened next. Every night when my dad came home from work, he would place his pants over a chair in the dining room right outside their bedroom. He kept his money in the pocket of his pants. At night, after my mom and dad went to sleep, I would sneak into the dining room and take some bills out of his pants pockets. I took this money not to spend on myself or to save, but to buy gifts for my friends. I really thought that if I could show them that I did have money, they would continue to like me.

Interesting, isn’t it, that the happy memories of the dozens of times I did go swimming at the Thunderbird Motel pale against the agonizing memory of the one time I couldn’t?

Without my knowing it, this memory played itself out well into my adult life. For years, even though I was becoming more and more successful, I felt “less than.” Until I could connect the dots—that who I am today is not the same little girl with no money to go swimming at the Thunderbird Motel—this memory defined how I felt about myself.

A few years ago I asked my mom if she remembered that Saturday, and she did; she still remembers the look on my face when she said she didn’t have a dollar to give me. Ever since then her biggest fear in life when it comes to me is that I don’t have enough money to get what I want and that I am suffering. It doesn’t matter how successful I become, she still calls me and asks, “Suze, are you okay? Now, if you need anything, you’d ask, wouldn’t you?” It’s as if she is still trying to make up for that Saturday.

 

Now it’s your turn to look back.

 

 

YOUR EXERCISE

 

As it was for Suzanne, Andy, Catherine, and me, this is a connect-the- dots exercise, revisiting the past and tracing the memories to where and how they affect your life today, and they do affect your life today.

In childhood we live full force, and when you delve into childhood memories, they are vivid, alive with all the five senses—you can see, touch, taste, smell, and hear them. The smell of cotton candy from the local amusement park, the feel of the wind against your face when you leaned out the car window, the mud squishing through your toes as you ran barefoot in and out of mud puddles, the cold on your face when temperatures dropped below zero, the way your house smelled when your mother was cooking your favorite meal. I am asking you to look back into your childhood and remember everything you can about money, the wonderful things it did and the ways in which it might have scared you.

Remember back to when you were three, twelve, or seventeen, and see what comes up for you.

When one money memory feels true, important, and keeps coming back, that’s the one we want. Here are some questions to help you remember:

What were the best presents you recall receiving when you were a child?

Did your friends have things you didn’t?

Did your mother have to work when others didn’t, or not have to work when others did?

Did you get money every time you went to see your grandparents?

Were you ashamed to bring your friends home to your house?

What were the special treats of your childhood? Did you have to be good in order to earn them?

Did you feel like your friends had nicer clothes than you did? Did your friends’ parents have more expensive cars than yours did?

Did you feel ashamed of having far more than your friends did?

Did you hear your parents fight about money?

Did you receive only money as gifts, instead of the personal touch of a handpicked present?

Did your mother close the windows when she bought something because your father would yell and she didn’t want the neighbors to hear? (Mine did.)

Was shopping for school clothes a ritual you looked forward to every year?

Did you steal—from piggy banks, your parents’ wallets, the dime store?

Do you remember the very first wallet you ever had? Was it given to you empty, or with a penny in it, or a dollar?

Did you get less of an allowance than your friends or siblings? Did you have to work for it, or was it given to you as your right? What did you do with it—spend it? save it?

 

What is the biggest amount of money you ever saw as a child?

Did you get money for birthdays? Did someone tell you what to do with it?

Did your friends go on better vacations than you?

What did your parents tell you about money that made you feel good? That made you feel bad?

 

THINK ABOUT YOUR PAST

As you are thinking back to your past, close your eyes. See whatever you can; remember what the scene looked like. Was someone baking cookies? Were you holding a wet bathing suit? What else was happening in the scene? Was someone laughing, arguing, crying, in the next room? With your child’s eyes, and with the adult eyes you have now, remember everything you can.

This first step may open the floodgates to many emotions. I’ve done this exercise with hundreds of people, and most people—even those who grew up in the wealthiest families—recall a painful memory, a memory that leaves them sad still.

One woman remembers stealing from a schoolmate’s cubbyhole and still feels ashamed.

One man remembers his magic Roy Rogers hat, which was stolen from him when he left it behind in a restaurant; he mourned the loss of his most valuable possession for weeks and never recovered the powers it gave him.

One woman received less allowance from her father than her older brother and younger stepbrother did, and her rage at her father’s unfairness—and her powerlessness against it—still hurts today.

One man still remembers crouching in the backseat of his father’s stretch limousine so his friends wouldn’t see him. Even now he feels ashamed of his money.

Every one of us has such a memory, and every such memory tells at least part of the story of who we are today. If you let it, your memory will reveal the roots of the fears that so strongly rule your financial life today.

After you have spent some time thinking about this, please write down everything about this memory that you can. Do not censor anything. If any of your friends or family members are interested and willing, you might want to invite them to do this exercise with you. If they take you  up on your invitation, please be sensitive as everyone re-creates their memories; we want to resolve the pain of the past, not add to it.

If you can do it with others, this exercise will not only help you to begin to remove your personal blocks about money, it will also help free you from the taboo that forbids you to talk about your fears about money.

You will be amazed at the things everyone remembers. This is a very important exercise.

We are all powerless as children, and money looms so powerfully. As we grow up we claim our power in one way after another, taking on jobs, families, commitments, responsibilities. Yet we don’t grow up to claim our financial power until we look money directly in the eye, face our fears, and claim that power back.

Each of our memories is different, but they all lead us to similar places, places that are riddled with self- doubt, unworthiness, insecurity, and fear.

Fear that has paralyzed us into thinking of all the things we can’t do, not all the things we can.

No financial advice you get or financial book you read is worth anything unless you can put that advice into action.

I’ve been afraid at times, and you might be afraid now. Let’s see what you’re afraid of, then do what must be done to put the fears to rest.

 

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9 STEPS TO FINANCIAL FREDOM - PORTIONS

PREFACE

WHAT DO YOU WANT FROM YOUR MONEY

A PREVIEW