More and more people are joining the ranks of financial content creators, educators, and coaches that promote an overall message around the importance of financial literacy. Popular financial topics along with discussions that promote vulnerability and transparency around your finances are an encouraging beacon of hope that lets you know you are not alone as an educator and a consumer.
A lesser discussed topic in the field of financial education – and likely the topic we most have in common – is behavioral finance and the impact of financial traumas on money behaviors and beliefs. These financial traumas not only impact how we interact with money but also how we teach others to interact with money. Understanding what financial trauma is and how it impacts you is crucial in making your message of financial literacy and empowerment stick and helping you connect to your audience in a more authentic way.
What Is Financial Trauma and where does it come from?
Financial trauma is any instance observed or experienced that negatively impacts your interactions with and beliefs about money. It can come from:
● Executing on investing advice you read on social media
● Experiencing poverty throughout your childhood
● Poorly managing credit card debt
● Being laid off or evicted
● Addiction
● Financial abuse in relationships
The fact of the matter is that financial trauma can come from anywhere and impact anyone. Whether we experience ‘big T’ trauma or ‘little t’ trauma, the impact on our behaviors, attitudes, and beliefs about money is something worth understanding. Especially if we are building an audience around these topics.
How Can Financial Trauma Impact You As A Creator?
One of my favorite examples of the impact financial trauma can have on creators can be observed in a well-known financial creator in the space. Without name dropping, this creator has gained relative popularity by discouraging the use of credit cards and the accumulation of debt. While this creator has positively impacted the lives of many struggling with consumer debt and helped them to get out of it, their messaging comes from their own financial traumas relating to mismanaged debt.
Oftentimes our own experiences become the fuel for our passions as educators. I grew up experiencing poverty and “aspiring to be poor” before I learned that not only was there a better way but one that was within my grasp. As a creator, it’s important to understand how your past or current traumas related to money can spill out into your messaging thereby passively inflicting that same trauma onto your audience.
In the case of the well-known creator mentioned previously, I shudder to think of how their messaging has robbed their audience of wealth-building opportunities. It is well-documented that debt used responsibly is one of the fastest accelerators of wealth. Had I not come to terms with my own financial traumas stemming from a place of scarcity and caution, perhaps my messaging would also limit financial possibilities and outcomes based on those experiences.
Auditing Your Traumas
One of the best ways to identify how you may be impacted by financial trauma is by examining the story you tell your audience. What you don’t say is just as important as what you do say especially if your attitudes or biases toward products, services, strategies, or professionals shine through. If you had a bad experience with a financial advisor do you tell your audience not to use financial advisors, or do you share your experience and tell them what dangers to avoid?
Our traumas can also be shaped by nonfinancial variables.
● Education
● Geographic location
● Race
● Religion
● Occupation
● Political views
These are a few examples of nonfinancial variables that can impact our own beliefs about money, as well as the way we interact with and teach about it. It can be easy to fall into the trap of leaning towards a particular product or service–especially if we’re affiliates– which is why it’s so important to disclose those relationships and be clear on whether or not you are educating or advising.
Understanding Everyone Is Not Your Audience
It’s one thing to be conscious of your own financial traumas. It’s another to understand how you may be inflicting trauma onto someone else. The saying that “personal finance is personal” is true. Experiences with money will vary from person to person. The ability to understand and execute financial concepts will also vary. Defining who your core audience is and getting familiar with their struggles and obstacles is crucial when it comes to the content you create. Accepting that your message is not for everyone and therefore should not be taken as specific advice for everyone’s situation will give you peace of mind. For example, you may create content for stay-at-home moms with spousal support. Your content may or may not indirectly create traumas for single moms relying on their sole income, even if that trauma is simply whether or not they deem your content as realistic.
Overcoming Your Financial Trauma
Identifying and accepting that you have financial trauma is only part of the work. Healing from that trauma will not only have a positive impact on how you engage with your own finances but also on how you engage others. As more and more attention is being drawn to the psychological aspects of managing finances, there are several types of professionals that you can seek out to help you address and overcome your financial trauma:
● Financial Psychologists
● Certified Financial Counselors
● Financial Coaches
● Financial Planners (not to be confused with advisors)
These are examples of professionals who are invested in helping you to overcome the barriers that financial trauma may present. Although not all-inclusive, this list has a range of skillsets and areas of specialization that can cater to the different levels of sophistication involved in understanding where you are and where you’d like to be.
As you grow in your expertise and reach make sure to explore your personal financial traumas. Your healing can be a tool in your development that can better serve your audience.
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