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How Emotions Can Derail Your Finances

Your emotions affect your money decisions more than you think.

Your finances will be haunted until you exorcise your financial demons.

When it comes to

financial literacy

, most people assume that personal finance is strictly about numbers and calculations applied to money.

Truth is, finances have a lot more to do with emotions than most people believe.

These emotions often show themselves as "money demons," and how they guide you in your relationship to your money can determine whether you stay poor or create wealth. If you can conquer the money demons in your life, you will have gone a long way to taking charge of your finances.

The first step to finding whether or not you have financial demons is to understand your relationship to money. Until you are truthful about the emotions that influence you when it comes to money, you can't put into practice all the financial information you have gained.

If everyone took a purely rational approach to money and applied all their knowledge, there would be far fewer financial worries in the world, but for many this is not the case. If you're one who has financial worries, there is a good chance it is the result of a money demon haunting you.

Here are some common financial demons. See if they are hiding within you.


When times are good and everything is going as planned, people often become complacent and believe that the good times will last forever. If money is tight, they figure the next raise or bonus will solve it.

The problem is that things don't always go according to plan, and there will be times when finances will be worse than expected. If you have failed to create an

emergency fund

, get the proper insurance for your needs. If you haven't made any preparations for the possibility that a financial emergency could occur, you may have the complacency demon within you.


Having all that you need is often not enough for those who look at what others have, and they see the situation as not fair. They want all the gadgets and toys that others have, even if they can't afford them.

Jealousy of what others have can quickly lead to spending money to keep up with the Joneses.

If you have ever felt that you were doing just fine with your money and then happened to look outside to see that the neighbors across the street just purchased a brand-new car, and you decide that you need one as well, the jealousy demon has you tight in his grip.

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Some people believe that they deserve more than they have, and this feeling of entitlement gets them into trouble. It can often mean that they go into debt due to buying things that they believe they deserve even when they don't have the money to do so. If you find yourself in deep credit card debt or regularly purchasing things that you know you can't afford because you believe you deserve them, the entitlement demon is holding your hand every time you go shopping.


Not getting things done on time can be a recurring behavior in many different aspects of life, with a common one being finances. Most people realize that they need to keep their finances up to date but simply procrastinate on getting the things done that need to be done.

In doing so, they end up putting off vital money decisions, and this can have a negative financial impact on their overall finances. If you find that everything that has to do with money is late or is being done at the last minute, such as your taxes, then the procrastination demon has taken control.


Sometimes it's easier to refuse to face the truth when you know that doing so will cause a lot of pain. Many people simply fear what they will see if they take a good look at their finances. They know that their finances aren't in proper order and that they need to do something, but they are so afraid to take a look and address the problems that they simply continue to do what they have been doing and ignore them.

Until the fear can be overcome, the financial situation will only continue to get worse and worse. If you know that there are financial issues that you need to address, such as credit-card debt, but have been putting them off because you don't want to deal with them, there is a good chance that the fear demon has found a home within you.


Keeping your finances in order takes a lot of time and energy. Many people who haven't learned to turn updating finances into a habit end up getting exhausted with the entire process to the point that they don't pay attention to their finances at all. If you have a pile of financial papers on your desk that you know need to be sortedand taken care of, but just don't have the energy or drive to do it, the fatigue demon is likely resting on your shoulders.


There is a lot of information out there about finances, some of which is conflicting. Some people hear all the differing points of view about what they should be doing with their money, and they just get confused. Instead of doing research to find the proper steps to take for their particular situation, they instead let confusion rule and simply don't do anything.

If everything pertaining with finances seems so overwhelming that you don't even know where to begin and end up ignoring your finances altogether, the confusion demon has you in its grasp.


Many people have anger and resentment about where they are financially. For any number of reasons, their finances have not worked out the way that they had assumed they would.

With money troubles constantly hounding them, they become angry and resentful toward anything that has to do with finances and choose not to take proactive steps to solve their problems. If you find that you continually feel frustrated about your finances, there is a good chance that the resentment demon has made a home inside you.


There is a serious lack of

financial education

in this country.

Some people simply don't know the financial steps that they should be taking because they have not learned what they need to do, and as a result they end up making poor decisions.

If you were one of those who was burned by the subprime mortgage crisis or have ended up losing money because you invested in something you didn't fully understand, then the ignorance demon has adopted you as a friend.

Healthy Exorcise

Some of these demons dwell inside all of us. Recognizing that they doexist and that they can lead us to make poor financial decisions is the best way to take away their powers.

Once you see that a certain money demon is trying to subvert your financial planning, take control and take steps to neutralize its powers, and get your finances in order.

Jeffrey Strain owns and runs