CBT For Your Money Mindset

 

Updated March 4, 2024

In my financial therapy sessions, I often pull techniques from other evidence-based therapy methods. One that comes in handy quite often is Cognitive Behavioral Therapy, or CBT. Click above to watch the financial CBT video, or read on below to learn how you can apply this method for your mind-money balance.

Are you stuck with a thought that isn't helpful when it comes to your money mindset? What if a technique for reframing your thoughts existed? Cognitive Behavioral Therapy or CBT does just that. When it comes to our money, our beliefs or thoughts are often the things keeping us from achieving our goals. I'll walk you through how we can use CBT, a proven intervention for anxiety and depression, and apply it to your money worries.

What is CBT?

Cognitive Behavioral Therapy or CBT is a type of treatment coined by Aaron Beck and David Burns that states your thoughts, feelings, and behaviors are all related. The way you think impacts how you feel, and how you feel changes the way you act or respond to something. This can lead a person to feel like they are in a downward spiral. In CBT, a person works on reframing or changing their thoughts, feelings, and behaviors for a better, more positive outcome, or as I like to say, "spiraling up."

How CBT Looks In Real Life

How does CBT actually work? Let me take you through a non-money related example first, so you can understand how CBT can be applied in a real-life, social anxiety situation. In this example, we’ll first examine a person’s thoughts.

  • Thought, "I'm socially awkward"

  • Feeling: Nervous, anxious

  • Action: Avoid attending a neighborhood BBQ

A therapist would ask you how you've dealt with similar situations in the past, and encourage you to look at the thought realistically and neutrally.

"I feel nervous and anxious and it's making me worry I'm socially awkward. At a recent work party, I did feel nervous at first but after connecting with others in my department, my worry wore off and I ended up having a good time. Instead of avoiding this BBQ, I can try and find someone I know to go with me."

Apply CBT to Your Money Mindset

Now, let's take the idea of CBT and apply it to your money mindset. Here's a money-minded CBT example:

  • Thought: "I'm terrible with money. Every time I get paid, I spend most of my paycheck."

  • Feeling: guilt, shame, loathing

  • Behavior: spend money quickly when I get paid

Using Cognitive Behavioral Therapy, we’d look at the thought with curiosity and search for a neutral or fact-based place.

  • Examine the thought: “What proof do I have that I’m bad at with money? What evidence do I have that I’m good with money?” We’d answer, “even though I spend quickly when I’m paid, I also always pay my rent in full and on time, and have enough money for my necessities, like groceries and transportation. I overspend on things like gadgets and accessories that I often only use for a few weeks before I get bored.”

  • Reframed thought, “Even though I spend my extra money on things like accessories, I always have enough money to cover my needs and pay for necessities like housing, transportation, and food. I can work on saving some money when I’m paid, and allowing myself to spend what’s leftover guilt-free.”

  • Feeling: apprehensive, excited, nervous

  • Behavior: move $100 to a savings account before spending money

Using CBT for Your Money In Real Life

You can practice using CBT in real life by tackling any of these three things: your thoughts, your feelings, or your behavior. The order of operations for CBT doesn't matter. You can go in any order-work on your behavior first (such as giving yourself a 24-hour "hold" period before buying any new clothes) to see how it impacts your thoughts and feelings. 

A Financial Therapist Can Help

If you need help applying CBT to your money-related worries, a financial therapist can help! As a certified financial therapist and licensed social worker, you can hire me to come into your school or organization. With this action, you not only prioritize your employees' financial well-being but also contribute to positive social impact. With a deep commitment to financial wellness, I partner with mission-driven companies seeking to address the growing demand for financial wellness benefits, including how to apply techniques like cognitive behavioral therapy can be helpful in understanding your relationship with money. Inquire about bringing me in to facilitate a workshop or speak today!


 
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