For Financial Planning Success Now, Start by Looking at the Past

Certain beliefs could be impeding your financial planning, and learning what those are begins with exploring your money-related memories.

A businessman looks back as he walks outside.
(Image credit: Getty Images)

We all carry our past experiences with us. And those past experiences can lead to limiting beliefs and avoiding dealing with financial planning for various reasons. That can, in turn, hinder your ability to achieve financial freedom.

Exploring and uncovering your limiting beliefs and barriers can put you on the path to achieving your financial freedom. Let’s explore your first money memories, limiting beliefs and potential barriers to financial wellness.

Identifying Your First Money Memory

On my podcast, Framework, I generally start off the conversation by asking guests, “What is your first money memory?” The question has elicited numerous interesting responses, from saving up money to splurge at the penny candy store to getting the first check from a babysitting gig.

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Exploring your first money memory can help you start to think about other memories. Thinking about all of those can help you understand why you have certain beliefs and behaviors around money today.

Exploring Your Limiting Beliefs

Before you can start building or envisioning your financial freedom, it’s essential to evaluate limiting beliefs that could be impeding your progress.

A common limiting belief is that you don’t need or aren’t worthy of being financially stable or building wealth. It might be easy to think that the nuances of your financial situation don’t require professional guidance. But in reality, the nuances of each person’s situation are what make personal finance personal.

Everyone’s journey with money looks different — we all have our own goals, dreams, fears and motivations, which makes each person’s situation distinctive. Don't let false beliefs stand between you and your financial wellness.

Understanding the influence of past financial experiences and releasing your limiting beliefs can get you one step closer to financial freedom.

Analyzing Potential Barriers to Getting Help

The complexity around financial planning continues to grow as there seems to be an overwhelming number of financial instruments to understand (like cryptocurrency) and new risks being identified (like sequence of return risks), as well as responsibility being placed on you to save for retirement.

Because of all of this, you might be hesitant to engage in managing your finances or having a professional help you do so. This could originate from six sources:

Having money trauma. Growing up with money trauma can be incredibly painful. Sonya Lutter, Ph.D., CFP, LMFT, owner of ENLITE, notes that money trauma manifests as recurrent and pervasive thoughts about actual or perceived threats to one’s financial well-being based on negative past experiences.

“People experiencing financial trauma have witnessed, learned about financial harm to a loved one or directly experienced moments of financial harm,” Lutter told me recently.

These experiences could include your family having debt problems, experiencing foreclosure of your home, witnessing your parents go through bankruptcy or watching your family amass hefty medical expenses, losing a significant possession, witnessing financial abuse or manipulation, gambling or compulsive buying.

Lutter notes that memories or flashbacks of financial trauma feel real and like they are happening in the moment. As such, they can impact your daily functioning. If you’ve experienced financial trauma, it’s understandable that you might want to avoid talking about money.

You’re confused by planning. You know financial planning is beneficial, but the elements involved and how they all fit together can be confusing. Financial planning often includes investments, tax advice, insurance and estate planning, among other things. If you don’t have a great understanding of those elements of financial planning, you might be apt to avoid it.

You might not understand the impact of planning. Perhaps growing up, you didn’t see the intricacies associated with financial planning and managing money, so you didn’t fully comprehend its effects. Maybe your family had enough to get by without you having to ever really think about money. But now it’s time to explore the power of planning to reap its benefits.

You don’t trust financial professionals. When you want to get your finances in order but don't feel confident doing it alone, a financial planning professional can help. But trust is paramount, and if you can’t find a financial adviser you trust and doubts arise, then you might not be comfortable engaging in the process.

You don’t feel like you need planning. You read financial information online, you understand investments generally, and you’ve been making good returns on your own investments. So you might not think financial planning is for you.

But above, we mentioned that each person has a unique situation, and planning might be beneficial for you for several reasons. Those include helping you identify goals; getting a comprehensive financial plan; helping you coordinate planning with other professionals, like CPAs and attorneys; and providing insight based on experience working with other clients in similar situations.

Move From Your Past to Your Financially Free Future

The baggage you carry from past money memories and limiting beliefs can hold you back. But what if instead of being held back, you could develop a plan to feel confident around your money and create prosperity now and in the future?

So ask yourself the questions: What is my first money memory? How do I feel about money and planning, and why do I feel that way? Analyze your history honestly — both its successes and mistakes — and you can gain clarity on what will move you closer toward your financial freedom.


This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Jamie P. Hopkins, Esq., CFP, RICP
Director of Retirement Research, Carson Wealth

Jamie Hopkins is a well-recognized writer, speaker and thought leader in the area of retirement income planning. He serves as Director of Retirement Research at Carson Group and is a finance professor of practice at Creighton University's Heider College of Business. His most recent book, "Rewirement: Rewiring The Way You Think About Retirement," details the behavioral finance issues that hold people back from a more financially secure retirement.