Everyone has a distinct way of perceiving money, as it symbolizes something different for each individual. One’s financial perspective is a direct reflection of personal history and background, which creates the bias that skews many decisions regarding money. Without complete consciousness of this bias, we may often experience money blunders.
I spoke with Joe John Duran, author of the New York Times bestselling book, “The Money Code: Improve Your Entire Financial Life Right Now.” Duran opened up about this lack of awareness when it comes to this bias and its effect on one’s personal relationship with money. It is a straightforward book that breaks down the mental process and emotions behind bad money decisions. The book might be able to change our stagnant culture and practice regarding money.
One section of his book that I found to be extremely helpful, focused on three types of “Money Minds.” Duran said that people can be divided into three main types of Money Minds that focused on three things: to avoid pain, to be happy and to fulfill your commitment to those you love. Whichever one happens to be your main priority will then determine the type of “Money Mind” you possess.
Most people will exhibit all three perspectives, but the one that dominates over the rest can be seen to have the greatest influence over your financial choices. By becoming conscious of your Money Mind, you can take the bias that it has on your decisions and act accordingly. It can also prevent problems and misunderstandings that can arise from having conflicting views on how to handle money and financial issues.
Find out which “Money Mind” you have by taking [The Money Mind Quiz].
MBT: Which “Money Mind” are you?
JD: After taking the quiz myself, I fell into the fear category.
MBT: So, I guess you’re not Jack. (The fictional character in his book who possesses the happiness Money Mind.)
JD: No, I’m not Jack. I’m probably his wife (Jack’s wife has a fear-based Money Mind). (laughs)
MBT: So, is your wife Jack?
JD: She is — she’s happiness and commitment. Jack is actually my sister. I initially wrote the book for her so she would be able to make smart choices that’ll lead her to a good life. She, who is a happiness Money Mind, was married to another happiness Money Mind, and they were going through a lot of financial battles and stress because they were overspending and being overly optimistic on how things were going to work out. Since then, she has really changed her life and the way she approaches money, thanks to the book.
In the end, if you want to have a good life, you want to have good habits, make good decisions, and need to have good luck. But all the good luck in the world won’t help unless you have good habits and can make good decisions.
MBT: So essentially, are you saying that the answer to a good life lies within us, and the control is in our hands as long as we have the will to do so?
JD: Yes. I’ve grown as a person by asking myself what I can do differently and better. The mistake that a lot of people make is that they try to fix the world around them first, and think that’s going to give them happiness. What I’ve found to be true is that you’ve got to start with yourself. If you cannot manage yourself, you cannot manage the things around you. Unfortunately, we are seldom given any instruction on how to move our biases and let go of the baggage. We have to come up with good answers, and good ways to come up with the best answers.
MBT: Discussing money and one’s personal finances, along with religion and politics, is so taboo in our culture. I think we live in a society where we try to stay away from the topic as long as they can, until it directly affects us.
JD: Nobody wants to talk about money. It’s really all uncomfortable.
MBT: That probably adds to the lack of our awareness when it comes to our financial perspective.
JD: That’s exactly right. I think there are two biggest challenge we face: The first is that we presume. Most of us are not even engaged in our decision-making and therefore make unconscious decisions, which is dreadful.
The second thing is that we assume that what we see is the truth. Almost always, what we think is true is usually an opinion and not a fact. It is important to ask yourself, is this, in fact true? It feels true but is it? (Continued on page 2)