RG
Col. Rakesh Goyal (Retd.)
Certified Financial Planner · Gurgaon
Dear Reader,
Over the past two weeks, we discussed market volatility and how to navigate it. But this week I want to step back from the numbers and talk about something more fundamental: our relationship with money itself.
In my years as a financial planner, I have observed that most financial problems are not caused by a lack of knowledge. They are caused by our beliefs, emotions and habits around money, many of which were formed in childhood and never examined since.
Understanding why we think and behave the way we do with money is the first and most important step towards financial wellbeing. I hope this week’s issue gives you something meaningful to reflect upon.
Understanding Our Relationship with Money
Money is not just a financial subject. It is an emotional one. How we earn, spend, save and invest is shaped less by logic and more by the beliefs and experiences we carry within us.
Ask anyone what they think about when they hear the word “money” and you will get a revealing answer. Some say security. Some say stress. Some say freedom. Some say greed. The word itself carries a different emotional charge for each person, shaped by a lifetime of experiences, observations and inherited beliefs. Yet most of us never stop to examine where these beliefs came from, or whether they are actually serving us.
Our relationship with money begins long before we earn our first rupee. It begins in childhood, watching how our parents talked about money, argued about it, celebrated it or avoided it altogether. These early observations form what psychologists call “money scripts”, deeply held beliefs that operate largely below the surface of our conscious decisions.
Consider Monica, a successful marketing executive in her mid-thirties. She grew up in a household where money was always tight and her parents often argued about bills. As an adult, she worked hard, climbed the corporate ladder and eventually earned a six-figure salary. But despite her financial success, Monica never felt secure. She saved obsessively, rarely indulging in anything beyond the basics. To Monica, money was safety, and the fear of losing it overshadowed the joy of having it.
Monica’s story is not uncommon. Many of us carry emotional baggage around money, rooted in what we saw and heard growing up. These associations quietly shape every financial decision we make as adults.
▶Family Conversations, or the absence of them. In many Indian households, money was either a source of anxiety or a taboo subject. Children absorbed these signals silently.
▶First Experiences such as being given pocket money and told to save it, or watching a parent lose a business, or growing up in scarcity. These experiences leave lasting imprints.
▶Social Conditioning from school, religion, culture and peer groups that money is either virtuous or corrupting, that wanting more is greedy, or that financial success defines personal worth.
Six Common Money Personalities
Most of us tend to lean towards one of these patterns. Recognising yours is the beginning of change:
1
The Hoarder. Saves compulsively, finds it difficult to spend even on necessary things, equates security entirely with accumulation.
2
The Spender. Uses money to feel good in the moment, struggles to save, often regrets purchases but repeats the pattern.
3
The Avoider. Ignores financial matters, does not open bank statements, avoids investment decisions, hopes things will work out on their own.
4
The Worrier. Constantly anxious about money regardless of how much they have, checks account balances obsessively, cannot enjoy financial security when it is achieved.
5
The Giver. Derives self-worth from providing for others, often at the cost of their own financial security, struggles to say no to financial requests from family.
6
The Risk-Taker. Drawn to high-risk opportunities, equates excitement with financial decision-making, often confuses speculation with investing.
Common Emotional Traps Around Money
Even intelligent, disciplined people fall into these patterns:
▶Spending to Feel Better. Retail therapy is real. A difficult day at work or an emotional setback can trigger impulsive spending. The relief is temporary but the financial impact lasts.
▶Saving Out of Fear Rather Than Purpose. There is a difference between saving because you have a goal and saving because you are terrified of the future. The former builds wealth. The latter builds anxiety.
▶Keeping Up With Others. Buying a car because a colleague did, renovating the house because a neighbour did. Social comparison is one of the most powerful and most destructive forces in personal finance.
Sarla, a teacher with a comfortable and stable life, found herself constantly comparing her situation to friends who seemed to have more: bigger homes, nicer cars and exotic vacations. Social media made it worse. Slowly, discontent set in. She eventually asked herself an honest question: was she unhappy because of her finances, or because of the comparisons she was making? The answer was clear. She began focusing on her own goals rather than keeping pace with others, and that shift brought her more peace than any salary increase ever could.
▶Avoiding Financial Conversations. Many couples never discuss money openly. Many families keep finances secret. This avoidance creates misalignment, surprises and sometimes serious conflict.
Self-Worth and Net Worth
One of the most deeply ingrained beliefs in our society is that a person’s financial status reflects their personal value. This leads to shame around financial difficulty, embarrassment about modest savings, and a relentless drive to appear wealthier than one actually is. The truth is that net worth is a measure of financial decisions made over time, not a measure of intelligence, character or human worth. Some of the most financially disciplined people live quietly and simply. Some of the most financially reckless live very visibly.
Building a Healthier Relationship with Money
A healthier relationship with money does not mean caring less about it. It means approaching it with clarity, intention and honesty:
▶Examine Your Money Beliefs. Ask yourself: what did I learn about money growing up? Do those beliefs still serve me today?
▶Define Your Values. What does financial success mean to you? Is it security, freedom, the ability to give back, or leaving something behind for your children? Knowing your values will ensure your financial decisions align with what truly matters to you.
▶Separate Needs From Wants. Not every purchase is a need. Not every investment is an opportunity. Clarity here prevents most financial mistakes.
▶Have Honest Conversations. Talk openly with your spouse about financial goals, spending habits and concerns. Silence around money creates distance and misalignment.
▶Work With a Planner. A good financial planner does not just manage your investments. They help you bring structure, objectivity and intention to your entire financial life.
In the end, money is just a resource, inherently neither good nor bad. It is how we use it, and more importantly how we relate to it, that determines its impact on our lives. By understanding and nurturing our relationship with money, we can use it to build not just a secure future, but a rich and fulfilling present.
