Creating a New Money Mindset
Dive into Your Past to Understand Your Relationship with Money | #6
Money has been on my mind lately because it’s an area that I’ve neglected too often. I had to teach myself how to manage my own money after my divorce, especially after needing to open a new savings account to start saving for retirement. It was daunting to start over financially in midlife when others started saving money right out of college. Getting a divorce in NYC is tied to a number of financial challenges, which is why many couples delay it. It’s just too costly to live separate lives in this city. The Atlantic published an article, The High Cost of Divorce, that dives deeper into this issue.
When I got married, I thought I would be secure financially for the rest of my life. Divorce and being on my own was not something I thought would be my reality. I was wrong, and it was a hard lesson to learn. Now, I am playing catch up by focusing on my career and teaching myself about saving and investing. At the same time, I have realized that my childhood experiences have shaped my relationship with money.
The Origins of My Relationship with Money
My mindset with money was based on fear and scarcity due to my family’s financial situation throughout my early years. I grew up living in a tiny apartment that cost $200/month for the first 14 years of my life where I shared a room with my younger brother. My mom took care of us and the home and had dropped out of college when she married my father. She never went back to finish her degree. Our family’s situation is an example of why the idea of “model minority’ is a myth.
People don’t talk about money openly. It feels like a taboo subject. A lot of us have issues around money that stem from our childhood and how our families handled money. I will say that even though my parents had their financial hardships, we were luckier than others.
My father had immigrated from India to get his MBA from a predominately Black college in Atlanta, GA. After graduating, he desperately looked around for a job. During that time, we lived off public assistance until he was lucky to find a job teaching accounting at a community college in a small town in Ohio called Springfield.
He worked at the college for about 10 years but experienced micro-aggressions and discrimination at work. Over the years, he had observed his colleagues get promotions and opportunities to teach the best classes while his own career stayed stagnant. He already knew that this job was a dead end job. In those days, most people stayed in the same job until retirement. However, my dad knew there was something better out there for him.
During these teaching years, he created a side hustle to make ends meet by selling holiday gifts in the middle of our local mall. He expanded this side hustle to the summer county fair, and other events around the town. We did not take many family vacations during holidays but instead spent our quality time together as a family in the middle of a mall selling gifts to other families.
My dad had dreams to own a business one day, and he made that a reality after saving money over those 10 years and taking out a loan. He bought a smoke shop business in that same mall where we used to sell gifts during the holidays and instead sold cigars, pipes, and tobacco. Due to this new family business, my brother and I spent a lot of time alone at home after school being latchkey kids since both of our parents needed to work in the shop long hours.
We could not participate in after school activities because our only transportation home was the school bus. I sometimes resented the shop for taking away my parents from home life at our young age. I didn’t realize that my dad was actually living his dream to be an entrepreneur and have freedom. That came with costs that we all had to absorb.
My dad’s business must have been going well enough during that time because he ended up buying two more smoke shops that allowed us to flee the small town and settle into a more affluent suburb of Columbus, Ohio. My parents valued our education and found an apartment to rent that allowed us to go to a good public school. It was a hard transition for me personally to leave the comfort of my small town school and friends who I had known since I was 5 years old.
The transition happened during the middle of my first year of high school which felt traumatic at the time. My childhood friends lived in trailer parks, apartments, and small homes in a rural area while the students at my new school drove luxury cars and lived in large suburban homes with 4 car garages. It was at this time in my early teens in the new school that I first realized how different our financial situation was compared to those around us.
My family could not purchase a home due to massive debt and credit issues my dad had racked up from poor business management. Even though my dad had studied and taught accounting, he had challenges in managing his own finances. I didn’t realize it at the time but all of this influenced how I managed my own money.
Through my dad’s mistakes, I learned some early valuable lessons around maintaining good credit, paying off debt, and not spending more than I earned. I was able to secure full tuition from our state university through an academic scholarship, and I paid for my graduate school tuition in NYC through a mix of government student loans and work related assistantships. I also always had some type of part-time job to earn spending money while going to school.
I was scared to death of having debt so I paid off my student loans quickly during my first two years of full-time work in nonprofits by living frugally in the outer boroughs of Queens with roommates. I am also aware now that I chose my first career path in a low wage sector in a very expensive city. If I knew then what I know now about work options and salary, I may have chosen an entirely different career path during those early years.
Creating a New Money Mindset
Looking back, I realized that those early experiences as a child and a teenager shaped my own relationship with money. Spending time reflecting on my childhood experiences and family influences has helped me understand and reset my money mindset. That awareness has helped me make changes for the better to help me feel more confident about my finances. I created a budget for the first time and watched YouTube videos to learn about investing and saving. I finally know what the difference is between a Traditional and Roth IRA. For the first time in my life, I feel in control of my financial future.
It took some time and self reflection to get to this point. If you are curious to understand your relationship with money, here are seven questions to get you started:
When did you first become aware about money and it’s value?
What messages did you learn about money from your parents or family members?
What are your current beliefs around money?
What are your biggest fears around money?
What is something that you want to change related to your relationship with money?
What is one goal you have related to money?
What is one thing you can do today that will help you move towards that goal?
Some Final Words
I bounced back after my divorce financially by jumping straight back into full-time work and getting back on the career ladder to catch up where I left off. It was not an easy climb and there were lots of tears along the way, especially when my past money mindset demons made occasional appearances. The reality of needing to be financially independent because there is no one there to catch me if I fall has been a motivating force. I’ve taken intentional steps to not fall back into old patterns based on fear.
Over these past few years, I learned how to negotiate my salary, ask for a raise, create a budget, and save money smartly. I am now just diving into how to invest and there is a lot to learn these days especially as I am dipping my toes into startup equity, and crypto. I am also trying to teach my teenage son how to manage his money now so that he has the tools and resources that I wish I had when I was his age. My hope for him is to live with a money mindset of abundance and gratitude.
Money Resources I Love
81cents Resource Library: a treasure trove of resources to help you prepare for any type of salary conversation whether it is asking for a raise or negotiating a new job offer. Their conversations scripts are helpful if you feel tongue-tied before a salary negotiation.
Ellevest: a website for women that includes personal finance classes and resources + financial planners and coaches. I have a friend who works there so I know they are legit as a company, and I’ve taken a few of their classes plus downloaded their easy to use budgeting tool which is a simple but well organized Google Sheet with built in formulas.
Money Scoop: a twice-a-week personal finance newsletter that makes you smarter about your money. I recently signed up for their 4 week Investing Challenge and found the emails they sent me about investing basics to be quite informative and easy to digest.
Investing with Rose is a YouTube channel that helped me better understand the world of finance. Rose is a former Wall Street trader turned financial educator and is great at simplifying complicated financial topics. I feel smarter every time after watching one of her videos.
Coinbase Learn: a great resource if you want to dip your toes into learning about cryptocurrencies. This part of their site provides beginner guides, practical tips, and market updates for first-timers, experienced investors, and everyone in between.
Rainbow Knowledge Base: my former colleague works at this startup in the crypto space and launched this resource guide to help you learn how to use their app to create an Ethereum wallet, collect NFTs, and explore the new world of Web3.
Step: A credit card for teens 13+ to help them build their credit. This makes it so much easier to transfer money to my son for his weekly allowance. I once had an issue (in their early days as a company) with their customer service and their Founder called me from his personal cell phone to resolve the issue after I reached out on social media. I’m also impressed by their app because my son can monitor his money, and he’s been actually spending less money than before when it was just sitting in his piggy bank.
I’d love to hear from you if you have any recommendations on additional resources to help with money management or personal finance!
You are so strong & resilient Satya, I am so very proud of you! Love this topic, it’s so raw and relatable. I can relate with your Dad’s pursuing his dream of entrepreneurship, I was pursuing my farm dream that did take my focus/ time away from family and neglect my health.
Fear of no money started as soon as I moved to Oklahoma after a semester when my parents money was all used up. As International student fees are higher, cannot work unless it’s internship, did not have any work experience, life at 20 was scary but I was young ready to work.
Your point about fear of money is just so real. As I am getting older fear of retirement and kids future is keeping me motivated to push through emotionally tough working days.
Love your writing!