Week 4 Flashcards
Define Financial socialization
Financial socialization: is the way people learn about money—how to manage it, what attitudes to have, and what financial habits to follow to stay financially stable and improve their well-being
- Financial decisions are influenced by our:
- Attitudes, which is influenced by:
- Family, Culture, Gender, Socioeconomic Status
- Attitudes, which is influenced by:
Define Family Systems Theory
Family Systems Theory: all parts/members of the system are connected. A change in one part of the system creates a change in other system components - or individual family members
- Ex. Grandmother is shopping for grandkids, the parents could stop her, but this could negatively affect other parts of the system (namely the children)
Define Social Learning Theory
Social Learning Theory:
- Money behaviors are learned through observation of parents, peers, and media.
* Reinforcement matters: Positive (rewards for saving) or negative (debt consequences) reinforcement shapes behavior.
- Findings from research:
○ Children involved in budgeting discussions at home develop better financial habits.
Gender differences exist: Boys tend to receive structured financial education, while girls have more general conversations with parents.
What is the difference between Implicit learning and Explicit learning?
Implicit learning is from observation
Explicit learning is from direct teaching
This connects to Social Learning Theory
Disordered money behaviours are often correlated with lower income and net worth… name a few
Disordered money behaviours are often correlated with lower income and net work.
Some of them include:
* pathological gambling
* Compulsive buying
* compulsive hoarding,
* workaholism,
* financial dependence,
* financial enabling
* financial denial, and
* financial enmeshment
Define Countertransference and why is it important
Countertransference is when professionals project their emotional state, and their values onto their clients
- Why its important: to identify values in family upbringing to avoid transferring negative feelings onto your client
Define Money Scripts
Money scripts are unconscious beliefs about money, often only partially true.
* Developed in childhood through financial flashpoints—early impactful financial experiences.
* Passed down through families and cultures, influencing financial behaviors.
* Resistant to change unless actively recognized and addressed.
- Typically passed down to generation to generation
Talk about the 4 main Money Scripts
-
Money Avoidance: people with this systematically avoid dealing with their money, abdicating personal responsibility for their financial health
Generally believe money is bad and taboo- Typically experience fear, disgust, or anxiety with money
- May severely underspend, overspend, or give much of their money away, so they have as little as possible
-
Money Worship: these people hold onto the believe that they would be happier if they had more money. They have perception that needs are never met, and more money is the answer to their problems.
Focus on earning, saving, or spending their money- Associate with safety, happiness, and/or power
- Are hoarders, workaholics, or have an endless pursuit towards money
-
Money Status: they believe that having money will give them the status or respect they desire
○ Believe network = self-worth- Interested in outward display of heir worth to others
- Lower levels of self-actualization, life satisfaction, and happiness
-
Money Vigilance: these people tend to be watchful, alert, and concerned about their finances. Vigilance or attentiveness to financial affairs is generally considered to be a positive characteristic
- Less likely to avoid financial matters, less likely to overspend, gamble
May suffer from excessive wariness and anxiety, and can be distrustful of others around money
- Less likely to avoid financial matters, less likely to overspend, gamble
define Money genogram
Money genogram: similar to a family tree with the addition of identifying the manuscripts of members of the family
Tools to help identify Money Scripts:
4 (include definintion of The Klontz Money Script Inventory (KMSI))
- Money Script Log: Helps clients track financial behaviors, emotions, and beliefs.
- Word Association & Sentence Completion: Identifies deep-seated money attitudes.
- Money Mantras: Encourages positive self-talk to replace harmful money beliefs.
- The Klontz Money Script Inventory (KMSI): identifies four primary money scripts such as Money Avoidance, Worship, Status, Vigilance
- Families function as “_” systems; changes in one part affect the whole.
interconnected
define Homeostasis
Homeostasis: Families resist change and maintain financial habits (even unhealthy ones), in ORDER to keep the system balanced!
○ Example: A grandmother overspending on gifts despite financial struggles due to family expectations.
To keep the system in working order, families seek to maintain homeostasis or balance in the system.
What are some concepts relevant to money attitudes:
○ “_”: Conflict between two people spreads to a third person (e.g., parents and child disagreeing on financial support).
○ “_”: Individuals rely on family for financial decisions.
○ “_” People disengage from financial discussions due to past conflicts.
Triangles
Differentiation of self
Emotional cutoff
hwo does Intergenerational Transfer work?
Intergenerational Transfer of Money Attitudes
1. How Parents Shape Money Attitudes
* Most adults report never discussing money with parents, yet they inherit financial beliefs.
* Observing parental arguments about money is linked to:
○ Higher credit card debt in adulthood.
○ Increased materialism in children.
○ Greater financial stress and lower well-being.
* Parents’ values about money are transferred regardless of socioeconomic status.
Financial socialization is critical for developing healthy financial behaviors…. How can parents do this?
- Children observe behaviors (e.g., late bill payments, gambling) and mimic them in adulthood.
- Savings habits are passed down—parents who save and talk about savings raise children who do the same.
why might financial professionals may need to refer clients to mental health experts?
Mental Health Referrals
- Money is a major stressor—financial professionals may need to refer clients to mental health experts.
- Financial therapy professionals can help address emotional financial issues. Help person uncover money scripts
what are some disordered money behaviours?
- Disordered money behaviors tied to these beliefs (the 4 primary money scripts)
Compulsive buying, hoarding, workaholism, financial dependence.
what is the The Klontz Money Behavior Inventory (KMBI)?
The Klontz Money Behavior Inventory (KMBI) is a standalone, multi-scale measure than can screen for the presence of eight distinct money disorders.
