Unraveling the Money-Guilt Complex

Guilt is a feeling we’re all too familiar with. It creeps in when we feel that we’ve done something wrong, violated a moral code, or failed to live up to our own expectations. When it comes to money, guilt can become a constant, nagging presence. We feel guilty about spending too much, not saving enough, or making poor financial decisions. At times, even when we’ve done nothing wrong, the sheer thought of money stirs guilt within us. Why does this happen?

Welcome to the realm of financial guilt. As a financial psychologist, I’ve helped many clients navigate this complex emotional landscape. Financial guilt can be a powerful force that influences our financial behaviors, often to our detriment. But with understanding and proactive management, we can transform guilt into a catalyst for positive change. Let’s take a deeper look.

The Roots of Financial Guilt

Financial guilt usually stems from deeply ingrained beliefs about money that we’ve absorbed from our family, culture, and personal experiences. These money scripts, as we call them in financial psychology, often involve moral judgments about what’s ‘right’ or ‘wrong’ in money matters.

For example, if you grew up in a household where spending money on ‘luxuries’ was frowned upon, you might feel guilty whenever you treat yourself, even if you can afford it. Or, if you’ve made a financial mistake in the past, such as racking up credit card debt or failing to save, guilt might linger long after you’ve rectified the situation. This guilt can hold you back from making empowering financial decisions and cause a great deal of stress and unhappiness.

The Impact of Financial Guilt

Financial guilt doesn’t just cause emotional distress; it can influence our financial behaviors in counterproductive ways. When ridden with guilt, we might overcompensate by overly restricting our spending, leading to feelings of deprivation and resentment. Or we might avoid dealing with our finances altogether, leading to potential oversights and missed opportunities.

As with Aaron and Rebecca, guilt can also strain relationships. If you feel guilty about your financial situation or decisions, you might become defensive or withdrawn in money conversations with your partner. Over time, this can create distance and misunderstandings.

Recognizing Financial Guilt

Recognizing financial guilt is the first step towards overcoming it. This involves becoming aware of the emotions that arise when you think about or interact with money. Do you feel a pang of guilt when you spend on something you enjoy? Or perhaps you feel guilty when you think about your savings account, believing you should be saving more.

Here’s a simple exercise to help you uncover any guilt associated with your financial behaviors:

  1. Take a few moments to relax and center yourself. You might find it helpful to do some deep breathing or a brief mindfulness exercise.
  2. Bring to mind a recent financial decision or behavior. It could be a purchase you made, a bill you paid, or even a money conversation you had.
  3. Notice what emotions arise as you think about this. If guilt is present, you might feel a heaviness in your chest or a knot in your stomach. You might also notice self-critical thoughts, such as “I shouldn’t have done that” or “I’m not good with money.”
  4. Write down your observations. This will help you see any patterns in your financial behaviors and the accompanying guilt.

Remember, this exercise is not about judging yourself or changing anything. It’s about observing and understanding your emotional relationship with money.

Strategies for Overcoming Financial Guilt

Once you’ve identified the areas where financial guilt shows up in your life, you can start working towards overcoming it. Here are a few strategies that have helped my clients:

  1. Reframe your money scripts: Challenge and reframe guilt-inducing beliefs about money. If you feel guilty about spending on yourself, for example, remind yourself that it’s okay to enjoy your money responsibly. If you feel guilty about a past mistake, remember that everyone makes mistakes and that you’ve learned from yours.
  2. Practice self-compassion: Be kind and understanding towards yourself when guilt arises. Instead of beating yourself up, treat yourself with the same compassion you’d offer to a friend in a similar situation.
  3. Set financial boundaries: If guilt comes from overspending or not saving enough, setting clear financial boundaries can help. This might involve creating a budget, setting spending limits, or automating your savings.
  4. Seek support: Talking about your feelings of financial guilt with a trusted friend, family member, or financial therapist can be incredibly therapeutic. They can provide a different perspective and help you navigate your feelings.


  • Lily Kensington

    Lily Kensington is a financial psychologist, a proud member of the ANZA Psychological Society, and a passionate advocate for financial wellness. A former high school English teacher and psychology graduate, Lily brings a unique perspective to her writing that blends the intricacies of psychology with the world of finance.Over the past decade, Lily has dedicated her life to helping individuals and couples navigate their emotional relationship with money. Her empathetic and intuitive approach, honed through her counselling practice, breaks down complex financial concepts into relatable and practical advice. Lily's writing often reflects her personal journey as a single mother, providing valuable insights and support for fellow single parents navigating the world of personal finance.In addition to her numerous contributions to wellness and personal development blogs, Lily is the author of the book "The Heart of Money: A Psychological Guide to Financial Wellness."In front of the camera or behind the pen, Lily's mission remains the same: to help others achieve financial peace by understanding the psychology of money.

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