How Your Childhood Shaped Your Spending Habits
In my thirty years of life, I have had an on-again, off-again relationship with money. Sometimes I think it is the root of all evil, or a necessary evil, and sometimes I feel like I know how to make it mine and have control of it. I grew up in Maine with one parent who had learned how to manage their money, while my other parent seemed to never have it together.
My father would tell me horror stories of how one day in his twenties, he walked away from all of his credit cards, choosing not to pay, dodging calls until one day they stopped. He had to learn how to survive on no credit, debt, and a whole lot of extravagant spending choices, like going to Europe. I was horrified by this and vowed never to be like him.
Unfortunately, in my twenties, I definitely made some pretty major financial mistakes. All in all, your parents’ money habits have a direct impact on your relationship with your finances, whether you want to admit it or not.
Messages From Home When It Comes to Your Money Story
Our parents’ relationship with money is the first modeled behavior that we see as children.
Did you watch your parents argue over bills? Talk openly about budgeting? If your parents did not model healthy “money scripts” or have a healthy relationship with money, likely, you don’t have a healthy one now.
A child in a financially stressed home may grow up believing money is always scarce, leading to anxiety-driven saving or hoarding. A child in a household that freely spends without budgeting might learn to equate spending with self-worth or emotional relief.
Money and Emotions Can Be Complicated
So many people try to deny this, but money is emotional. There is shame when we don’t have enough, there is confidence when we do.
Money and emotions are tied together. Especially in childhood, our emotions often imprint themselves deeply onto our financial behavior. If spending money meant joy—say, a new toy as a reward—it may become a go-to emotional coping tool in adulthood. If financial stability were tied to parental approval or conflict, money can carry emotional weight long after we leave home.
These associations can lead to habits like impulsive spending, retail therapy, or guilt around enjoying money.
Breaking the Cycle When It Comes To Your Childhood and Money Habits
The good news? Nothing is permanent. Just because you have done something one way, because your parents taught or modeled something for you, doesn’t mean you have to continue to do it. Childhood may set the stage, but it doesn’t solidify the script. The first step to changing your money mindset is bringing awareness to the problem. It is important to ask yourself, Where does my money go? Once you have that answer, you can create sustainable change.
If you find yourself unable to budget, overspending, and constantly worried about money, it is important to ask yourself: “Where did these patterns begin?” Financial literacy, therapy, and honest conversations with yourself and your partner can help transform toxic money behaviors into transformative and empowered ones.
Our childhoods are a financial lens; they set a tone for how our relationships with money shift as we get older. It doesn’t matter what mistakes you have made in the past; you have the power and the ability to understand your money patterns and change them.
Seven Ways Your Childhood Shaped Your Spending Habits
1. Parental Influence: The way your parents handled money often sets the foundation for your own spending habits. If they prioritized saving or budgeting, you’re likely to adopt similar behaviors.
2. Exposure to Financial Education: Early lessons about money management, whether from formal education or parental teaching, can have a lasting impact. If you learned about saving, investing, and budgeting as a child, you may be more financially savvy as an adult.
3. Shopping Experiences: Regular trips to the store with parents could shape your views on shopping. Positive experiences may lead to more impulsive buying later, while negative experiences may create a frugal mindset.
4. Social Influences: Growing up, the spending habits of friends and peers can greatly affect your own. If your social circle encouraged spending, you may be more inclined to follow suit.
5. Value of Money: If you had to earn your own money through chores or small jobs, you might have a stronger appreciation for its value, leading to more cautious spending habits.
6. Cultural Attitudes: Cultural background can heavily influence how you view money—whether it’s seen as a means of security, a way to gain status, or something to be shared with family and community, can shape your approach to spending.
7. Financial Setbacks: Experiencing financial difficulties during childhood, such as a parent losing a job or facing debt, can instill a sense of scarcity that makes you more cautious with your spending as an adult.
Steps To Break Financial Generational Trauma Cycles
Educate Yourself: Take the time to learn about personal finance, budgeting, and investing. Understanding money management can empower you to make informed decisions and create a positive financial future, breaking the cycle of financial trauma.
Open Conversations: Initiate dialogues about finances with your family. Sharing experiences and discussing financial values can help normalize conversations about money and reduce stigma, allowing for healing and growth. If this does not feel safe, start by finding a mental health therapist to support you and help you find peace and safety with these financial conversations.
Set Clear Goals: Define your financial goals and establish a realistic plan to achieve them. By focusing on your aspirations and creating actionable steps, you can shift your mindset from scarcity to abundance, fostering a healthier relationship with money.
