There’s a growing push for more financial literacy in schools, but one of the barriers to financial stability or growing wealth may have nothing to do with knowledge. In fact, some money problems may stem from past trauma or beliefs from childhood. These beliefs — which financial psychology pioneers Drs. Ted and Brad Klontz call “money scripts” — may hinder your financial health. Luckily, you can tackle these issues by working with a financial therapist.
What is financial therapy?
Dr. Preston Cherry, a certified financial planner and founder and president of Concurrent Financial Planning, says financial therapy combines financial advice with psychoanalysis. He says it may be a way to unpack the emotional or behavioural barriers to your financial well-being.
“Financial therapy is a process to process,” says Cherry, who also serves on the Board of Directors for the Financial Therapy Association. He says a financial therapist may help you understand your behaviours, and once you can process them it may be easier to build wealth in the future.
Financial therapy has been around since the 1990s, but until recently, anyone could call themselves a financial therapist. The Financial Therapy Association has been working to unite professionals across multiple fields, including psychotherapists, certified financial planners, social workers, and family counselors. One of the goal is to establish best practices for financial therapy with a professional designation — Certified Financial Therapist.
Although the Certified Financial Therapist designation isn’t a clinical licence, Cherry says it represents competency in both the financial and psychology fields to accomplish a client’s goals.
How to know if you need a financial therapist
When you don’t understand your relationship with money, it can be difficult to address some of your harmful behaviours. For example, you may struggle with overspending, or your excessive penny-pinching may be hurting your family’s quality of life.
It’s possible you recognise these destructive money behaviours, but you’re still not able to make changes. Cherry sums it up as: “You want to do better, however, you are seemingly unable to.” Financial therapy could offer the break-through you’re looking for.
Where to find a financial therapist
Cherry says you can find a financial therapist through the Financial Therapy Association. You may use the organisation’s website to find someone in your area or a practitioner who works virtually. The website also allows you to see profiles for each professional — including their education, licenses, typical client profile, fee structure, and more.
Regardless of who you choose to work with, Cherry says you may be more likely to see progress if you approach the guidance with an open mind. “Financial therapy takes courage, vulnerability, and trust in the process,” he says.
Editor’s Note: The Financial Therapy Association currently only runs in the U.S. Find local alternatives online.