Episode 27 - How Financial Therapy Can Transform Your Relationship with Money with Natasha Knox
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This week on Your Estate Matters, Nicole and Greg chat with Natasha Knox, a financial therapist and principal of Alaphia Financial Wellness. They explore the unique field of financial therapy, which combines financial planning with therapeutic techniques to address the emotional aspects of money management. Natasha shares her journey into financial therapy, the impact of upbringing on financial behaviours, and common money beliefs. She offers strategies for couples to improve financial communication and discusses teaching children healthy money attitudes. The episode aims to help listeners enhance their financial well-being and protect their legacies.
Transcript:
Nicole 00:00:02 Hello and welcome to your Estate Matters with your hosts, my colleague Greg Brennand and myself, Nicole Garton of Heritage Trust.
Greg 00:00:09 Your Estate Matters is a podcast dedicated to everything estates, including building and preserving your legacy.
Nicole 00:00:16 If it's estate related, we'll be talking about it. We're having the conversations today that will help Canadians protect their families, their assets and their legacies tomorrow. Natasha Knox is the principal of Alaphia Financial Wellness, a purpose and mission driven financial wellness experience designed with the complex needs of older millennials and Gen X professionals in mind. Alaphia is a unique practice that is based on three pillars education. Evidence based therapeutic interventions, and robust financial planning. In her planning practice, Natasha works with the whole person, not just the numbers. She approaches personal values, behaviors, and life purpose before addressing the exterior finances. Natasha, thank you so much for being here with us today to talk about financial therapy.
Natasha 00:01:10 I'm delighted to be here.
Nicole 00:01:11 So tell us about yourself and your journey to your current role.
Natasha 00:01:14 So I started as a financial planner.
Natasha 00:01:16 That is my main professional orientation. It's still my main professional orientation. And about 13 years into my career. It was sort of a confluence of different things, but I'll abbreviate the story. I was up late. I was searching for something for a client situation that was a little intractable, and I must have googled financial therapy or something. I can't remember the exact search, but I discovered very Tesla's website. She's a financial therapist, has been doing it a long, long time. And I realized, wait, this is a thing? So then I fell down the rabbit hole of like, what is financial therapy? And I found the Financial Therapy Association, and I found the Kansas State program, which at the time was the only program that I could do long distance. So that's what I did. I enrolled myself and the graduate program at K-State in financial therapy. That's how I found it. And once I started learning about it, I realized that I'd been seeing all these problems all along. And this was going to offer me the sort of additional skill set that I needed to address.
Natasha 00:02:27 Some of the things that I was seeing that I didn't really know how to address.
Greg 00:02:31 Natasha, what is a financial therapy and how does it differ from traditional financial planning or mental health counseling?
Natasha 00:02:39 Okay, so traditional financial planning, you know, we're always having really intimate conversations with our clients. You know, most planners are really great listeners. We'll talk about their values, what's going on with their families. All of us need to do that in order to do a proper job. So very often it feels like I'm their therapist, and where financial therapy and financial planning sort of differ is financial therapy is actually applying evidence-based interventions. So, the way that we might ask a question might be different, or we may have training to work with the client's nervous system to help bring them back online when they've gone into fight or flight, which happens all the time when we're dealing with money situations and it's a little more intentional. And I would say that it's also by invitation. So, you know, sometimes people come to see me and they're wanting more of a traditional financial planning experience.
Natasha 00:03:41 So I'm not going to necessarily ask them, so what just happened in your body when you heard that? Because they would say, what now? Because they didn't really opt into it. So those would be some of the differences.
Nicole 00:03:56 So how do your past experiences and upbringing shape your current relationship with financial behaviors?
Natasha 00:04:01 So many ways, and it often starts in childhood. It's when those beliefs and behaviors usually originate. It's not necessarily a linear relationship in the way that people necessarily think, though. So you can have two children raised in the same household who are experiencing some of the same things, overhearing and witnessing and getting some of the same messages, and they might take two different things from it. So, for instance, someone that, let's say, had parents that routinely kept secrets and maybe they were roped into some of the secret keeping. That's the thing that happens in a lot of families. So one child may end up having a lot of secrecy in their own finances and in their own partnership when they become adults, because they're sort of repeating the behavior that they saw.
Natasha 00:04:55 The other child may go in the absolute opposite direction and decide radical transparency is the only way to go because, you know, they felt so much guilt in the weight of keeping the secrets, was so heavy, and they saw the outcome. So the upbringing is definitely exerting an influence on both of those siblings. But the actual behavior might look different. So it takes a little bit of investigation to find out how exactly it impacts.
Greg 00:05:22 What are some of the common money beliefs that people would hold that come to you, and how do these impact financial behaviors?
Natasha 00:05:29 I mean, the money beliefs are really varied, so it can be anything from there will never be enough, even if they have a ton, I am not enough. I have to use money to get people to love me. It can look like a lot of things. What if this time is different? I mean, it can look like a lot of things, and those are sort of statements that it takes a while to get to. They're not necessarily conscious.
Natasha 00:05:54 So, you know, I need to use money to get people to respect and love me isn't necessarily what they're consciously coming in with. You know, it may look like something else until we dig a little bit deeper or, you know, money causes fights that might not be what is the initial thing that they tell me. But as we dig deeper, we can get to that sort of core belief. Yeah, money causes fights or you know.
Nicole 00:06:20 So how do couples work on improving communication around money and align their goals?
Natasha 00:06:26 The real answer or a tip?
Nicole 00:06:28 Let's go real.
Natasha 00:06:28 Real answer. They have to learn to monitor their nervous system. So if a couple has an easy time talking about money, then fine. But if a couple is having challenges talking about money, there isn't a magic phrase that is going to help them behave better. You can't logic someone into behaving better when they're in fight or flight. So when I say work with their nervous system, usually when we hear something or see something or in a relationship, something happens that upsets us.
Natasha 00:07:09 We go into fight or flight mode, and once we're in fight or flight mode, all bets are off. Logical thinking is gone. And so we're not reaching that other person. So actually the couples need to work on learning how to listen and learning to work with those parts of themselves that get triggered by whatever is going on in the relationship or whatever behavior or interpersonal dynamic is arising, so that they can listen so they can really hear each other. And that's really the only way that they're going to be able to build that ability to come to a consensus.
Nicole 00:07:46 What about couples that have different styles, like the classic Saver versus the spender. Like how do you help people reconcile those different perspectives?
Natasha 00:07:56 So okay, I have a few things to say about that. So the classic saver versus spender isn't quite so classic. I've seen a few, but they are more rare than you would think. It usually looks more like different priorities. Many relationships will have a person who maybe wants to spend on certain things, but not others, so that's what I see more often.
Natasha 00:08:21 However, there may be people who have a high desire to save and accumulate. And there may be other people who have a high desire to live. For now, that's usually really challenging, actually. And again, getting to the core of why it's important to live for now and why it's important to save and what that means to that person. It requires a lot of real listening and a lot of real understanding to understand. A lot of times fear is a driving emotion. So this live for now. If you dig deeper, there may be some underlying fear actually, that if you don't live for now, like it could be gone tomorrow, I could die tomorrow. Who knows, we could miss out on something. Similarly, the fear that drives a person who has a high desire to accumulate is, well, will never have enough. I'll never retire. I'm afraid I'll be poor. Whether or not these things are actually tethered to their financial reality is a whole other discussion. But fear is very often a very big underlying emotion.
Natasha 00:09:27 That and shame.
Nicole 00:09:28 So let's talk about we've got a really serious cost of living crisis, particularly in Vancouver, where housing has disconnected from what people make. We have inflation. People are really struggling even to meet basic needs. what are some ideas about how people can navigate that from a financial therapy perspective.
Natasha 00:09:49 So what I usually do is I help people see the decisions that are within their control. We can't control the economy, we can complain about it, but we can't control it. But there are decisions that people can make and sometimes they are not fabulous decisions. It's not the first thing that a person might be wanting to do. So for instance, someone who is single might not love the idea of a roommate. They may very much dislike the idea of a roommate, but it is actually a decision like it is a decision that is within their control. People may not love the idea of taking public transit. It is a decision that, depending on where they live, could be within their control.
Natasha 00:10:34 Like those are the types of things that can really move the needle and help people get ahead versus, you know, looking at smaller things like cut some of your streaming services, use a library card. Those all help, but it's really the bigger decisions that really move the needle. And for people who are in a position to, let's say, live at home a little longer, younger folks who are starting to despair of ever being able to get a toehold in the housing market. If they're in a situation where they're able to live at home, they can safely live at home, and their parents are on board with it so that they can save, you know, that's a fantastic way of being able to get a toehold. And they may have to be flexible. So Vancouver may not be the first place that they buy. You know, it may be an outer community, for instance. So there are still decisions that people can make that can help them get ahead, even if they aren't necessarily decisions that we made when we were, you know, younger.
Natasha 00:11:35 And honestly, many of us did make those decisions when we were younger. Many of us did have roommates, many of us did, you know, start with a two bedroom condo and maybe had someone come in to help with the mortgage or different things. So in that way, it hasn't entirely changed. And it's not super pleasant necessarily, but it can help.
Greg 00:11:59 So when we're looking at the role emotions play in financial decision making. How can we become more aware of them. So somebody, if they're, I suppose, hesitant about approaching financial planning or estate planning or just their bills, you're trying to work with them about getting over that. But fear is one emotion. But is it just embarrassment? I don't make as much as my friends. Or is it social status or is it cultural?
Natasha 00:12:23 Yeah, it could be any of the above. I would say that the close cousin of embarrassment is shame, and it can be about a lot of stuff. Stuff that might even be not even necessarily what any of this table is thinking about.
Natasha 00:12:38 I every week I learn about a new kind of shame or a different kind of fear. So what can people do on their own? The first thing is start to become aware of what you're telling yourself about the situation. Maybe you can write it down or have a voice note. So take that internal voice and actually make a note of what you've told yourself about the situation and your response to it and start to notice if you can. What happens in your body? So I keep talking about the body. And that's because our nervous system can't lie. Our bodies can't lie to us. Our brains can lie and do all the time. We tell ourselves all kinds of stories. But if we start to pay attention to our body, we may start to realize what we are trying to avoid. So sometimes it's not necessarily that we're feeling shame, but we're using a behavior to avoid feeling shame. So we might not be consciously feeling afraid because as soon as we feel that tightening or that pit we then switch into whatever the behaviour is to avoid staying with that fear and exploring it further.
Natasha 00:13:50 So noticing that pit and trying to think about what is really going on here, it's a really good first step to moving forward. So if a person is not ready to engage with someone, that would be a first step. Notice what you're saying about it. Notice what emotion arises. Sometimes people are not living in their bodies at all. You know, they may be listening to this podcast saying, I don't really know what she's talking about. I don't feel anything. It's probably beyond the scope of this conversation, but there are a lot of reasons why someone might not be living in their body. So there's some other things a person could try. They could draw an outline of a body, right, and start to see if they can even like so it's called externalization. So to try to, you know, maybe make a note like on a piece of paper. So having that piece of paper is sort of the intermediary can sometimes help people. That's one approach. Another thing would be to try and connect it to a need.
Natasha 00:14:49 So I'm not talking about needs versus wants. I think that discourse is actually really quite harmful. So what I'm talking about here are universal needs. So it would be something you could almost replace with let's say values. So we all have needs. So what is going on. What need is let's say if a person has an issue with money it's usually a need that's not being met. So here I'm talking about a need for security a need for connection or belonging. You know, a need for justice. And justice can look like a lot of things. It might be to get even. It could be for fairness. It could be to prove something. It could be lots of things. Equality. It could be a need for physical wellbeing. It could be a need for harmony. Someone who has a high desire for harmony may engage in fawning behaviors or enabling behaviors because they don't want to deal with the emotional fallout. So that's what I mean when I talk about needs. Now, if there is an issue with money, it may be that you are using money to meet a need in a way that money should not be used.
Natasha 00:15:58 So first you try and identify the need without judgment. Right. So this is what it's about. This is what I'm doing. And this is what the underlying need is. And you can kind of try and think is this really the best way to meet this need? Is the need going to be actually met in this way? Maybe not. You know, some of those repetitive behaviors that people have are usually about trying to meet a need with money that really can't be met with money. Like maybe what you need is to have a heartfelt conversation and set a boundary, or maybe what you really need is something else.
Nicole 00:16:31 So it's really interesting. It makes me think about the cultural and maybe even gender overlay in that some cultures, if you're working with people, might be more open to these conversations and some might not. And then I was thinking the stereotypic idea of men versus women and asking about how men feel in their bodies, about their financial status. They're like.
Natasha 00:16:55 What?
Nicole 00:16:56 I just wonder how that flies.
Nicole 00:16:58 So. So what's your experience of those perspectives?
Natasha 00:17:02 You know, interestingly, I would say the somatic type work is not as gendered as you would think. It has more to do with whether a person has done that type of therapy before. So I find that people who have been in therapy are a more likely to seek financial therapy, because they've used therapy successfully to help themselves in different areas of their life, so they know what works for them, and they're kind of accustomed to the approach. So they've sort of learned how to pay closer attention. And I find that that is actually a bigger predictor than gender. I think by the time a person comes to see me, they're in sufficient distress that they're willing to try. And so those sort of stereotypes don't tend to apply by the time I see someone because they're ready.
Nicole 00:17:54 So how do people know that they're a good candidate or they should explore financial therapy?
Natasha 00:17:59 A few things. So I think the main one would be if you know what you should be doing and you're not doing it.
Natasha 00:18:05 So that would be sort of the main thing. You know what to do. You've been told what to do and you're not doing it. That would be the first sign if it is causing distress in your relationships, like significant distress in your relationships that you're unable to resolve. That would be another sign if you have behaviors that are not being solved by conventional means. That would be another sign.
Greg 00:18:33 How can parents teach healthy money attitudes to their children.
Natasha 00:18:37 So there is what we tell our children and what our children witness. I would say that there are a few things. First, explore whether what you want your children to know with money meshes with what you are modeling for your children with money. So that's the number one thing. Are those two things the same? So if the answer to that is yes, then proceed to step two. The answer to that is no. Then get your behavior in alignment with what it is that you want your children to know about money. And then step two is start to have the conversations early at, you know, an age appropriate time and start to allow them to develop competence and make little mistakes safely before they grow up into adults that make big mistakes because they didn't have the opportunity to learn and help them, you know, without scolding them or without shaming them.
Natasha 00:19:39 But also make what you do visible. So sometimes I actually see clients who came from families where money was not talked about, but it seemed like the parents were doing okay and it wasn't a salient issue. It just wasn't an issue at all in the household. And so they didn't learn anything because it was never talked about. And the parents may have had beliefs such as, well, I don't ever want my children to worry about money, right? And that's their stuff. But what happened is that the children learn nothing about money. It just sort of came and went. Everything was always automatically paid, but they didn't have the opportunity to develop the skill. So really it is not just talking to kids about money, but giving them the opportunity to manage it at different stages of their life according to whatever your values are.
Nicole 00:20:27 So let's talk about talking about money and not. I think there's still a perception or feeling that it's not something to be discussed. Or do you want to tell us about that and how we can maybe improve our communication around that to help each other and our children?
Natasha 00:20:42 Well, I think if someone is listening to this and they believe it is not something to be discussed, I think the first thing to do is look inward and say, well, that's interesting.
Natasha 00:20:53 Why do I think that it's not something to be discussed? What is it about money that I think makes it taboo? That would be the first step. So I'm always like really curious. Why? Why not? What is it about money that you know, why not? And then you may come up with an answer. And then I would probably ask. Oh that's interesting. So why is that? You know, and you could probably ask yourself that about five times before you get to the real answer and see if that seems true. And if what if that were not the case? You know, what? If that thing that you believed to be so, so true is not true? What would be different about how you relate to money and you know how you behave and communicate around money. If that core thing, after you've asked yourself this question of why? Five times. What if that weren't actually true? What would be different? And how would things be different if you actually talked about it?
Nicole 00:21:44 So can I ask a societal question in that if we look at, for example, social media, it seems like there's a perception out there that a lot of people have resources that maybe behind closed doors, they don't necessarily have, like, what should we communicate with our children around that? And, you know, it seems like we have a consumer culture conflicting with the behaviors that we should be doing if we're going to have secure finances.
Natasha 00:22:09 Well, that's a tough one. What makes it hard is that the consumer culture is very closely linked to acceptance and belonging for kids. And so, you know, it's one thing to have family values that we adhere to and say, well, this is what we stand for as a family. And hopefully, you know, we continue to bang that drum and at the same time recognize that our kids grew up in a totally different world, like they're constantly plugged in, so they values that were sort of like vertically passed down or being transmitted horizontally from child to child on a level that is unprecedented at a much younger age. Even the generations are getting compressed. You know, I've got Zs, I've got an alpha. And apparently now with AI there's a new generation. I can't remember what it's being called that will be growing up in the presence of AI, which is a whole other thing. Some compassion for that, I think is necessary. It's not to say that you give up, but I think giving kids a respite from that constantly plugged in culture is helpful.
Natasha 00:23:21 If we don't want them to succumb to the consumer culture and acknowledging that there is a certain amount of belonging that everyone yearns for.
Greg 00:23:29 I did have one other question about my father happened to have been born the day the Great Depression started. Basically, yeah. Seven kids in the house. Yeah, right. My wife's family is from Europe. They lived in the war as children, so came from very restricted backgrounds, certainly when they were younger. So always big savers on both sides. Does anybody ever have the reverse problem. They've actually done well. Yep. But money's tight. Like they're afraid to let the reins loosen a little bit.
Natasha 00:24:00 Yeah I see it all the time.
Greg 00:24:01 How can you help them overcome some of that? Because they've always got this feeling of rarity of food or shelter or, you know, just being dispossessed.
Natasha 00:24:13 My first question is always like, is it a problem for the person? You know, unless it's a problem for them, it's not a problem for me, unless it's a problem for the people that they love.
Natasha 00:24:23 Like so your parents, for instance, if they were perfectly comfortable with the way they lived and perfectly happy and in total alignment with each other. Like, I'm not going to come in there and say, oh, you must change. You must loosen the reins. But if it were the case that maybe one of them or both of them were suppressing things that they really wanted to do or do for you, or were having some sort of internal conflict like, we kind of want to help our kids now, or, you know, there's some experiences that we really sort of denied ourselves while we were working. But now that we're retired, we would love to do this thing. That's where it becomes both. So it becomes both the financial skill set of actually showing them it will be okay. Right? Here's all the ways in which you will be okay if you do this. Assuming that's true, right? Like so you apply the logical piece and then if that's not working, that's when I go to the financial therapy piece of some of the interventions that I described earlier.
Natasha 00:25:30 So it really starts with is this a problem for the person. So I don't have a preconceived notion of what is a problem or isn't a problem, or should be a problem, or shouldn't be a problem.
Nicole 00:25:41 So I'm interested in your practice. Do people come to you because of your expertise in financial therapy, or do people come to you as a, I guess, quote, regular financial planner and then you like sort of slide in that financial therapy benefits, like how does it work?
Natasha 00:26:00 So I get both. And I think most people, even if they come to see me as regular financial planning clients, and that's where we start. And I keep it at that level unless they request something else. And I know this about them before I even meet them. I have an intake, so I already know what approach they're looking for. Interestingly, they're probably going to hire me for a reason. You know, my website is quite comprehensive. They know sort of what I'm about. So even if they're regular financial planning clients, I'm not really slipping in financial therapy.
Natasha 00:26:32 But the way I might ask a question or the types of questions I might ask are pretty ingrained. So it might sort of come out in that way. But if what they want is financial planning, that's what they get. And then people who want that more blended approach, that's what they get.
Greg 00:26:51 Is there any final tips?
Natasha 00:26:53 I would say this. a lot of the people that I see by the time they come to see me have been scolding themselves and beating themselves up for years over whatever the issue is. And I think being internally at war with yourself, if that was going to work, it would have worked already. And so self-compassion and being in a relationship with those parts of ourselves that have the behaviors that hold the behaviors and understanding why we do what we do is really critical.
Nicole 00:27:27 Thank you so much. We really appreciate you sharing your expertise with us and our listeners.
Natasha 00:27:31 Yeah, it was wonderful to be here. Thank you. Thanks.
Nicole 00:27:34 This podcast is for informational purposes only and should not be considered individual, legal, financial or tax advice.
Nicole 00:27:42 Make sure to consult the advisor of your choice to advise you on your own circumstances. Thank you for joining us for this episode of Your Estate Matters. If you like this podcast, make sure to follow it on your podcast platform of choice.
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