Spending is like eating, says Sophie Bennett, Personal Finance Expert and Author of Money Bondage: Discover the Power of Mind Over Money. It’s easy to consume little treats and indulge without thinking long term. “After all, one biscuit a day never made anybody fat,” she says. “Then one day, after many tiny indiscretions, you step on the scales and are horrified by the number on the dial.”
And, as with food, she says our view of money is shaped by emotions. But women and men take very different approaches to managing money — men use money as a way of keeping score while women care about the security it brings.
The book was inspired by Bennett’s own situation. In 1996, she was over £60,000 (about Dh372,600) in debt and didn’t feel there was a way out.
How did you get out of debt?
I started by reversing the habits that got me into trouble in the first place. The first step was to balance my income and outgoings for a while until I got used to spending less. Then I focused on growing my income — it would have been too much to do both at once at the beginning. When I learnt how to generate more money than I spent each week, I used every penny I had to pay down the debt. Keeping up the same habit later taught me how to save and, eventually, invest.
Recognising a problem is the biggest step. What was yours?
As with addiction treatment programmes, I had to own up and take responsibility for my own spending habits. I had lived with such optimism I thought that if I kept the faith, some miracle would happen and the money I needed would come flowing into my life. It didn’t.
Why do you say the mind can master money?
In many cultures, especially in the West, money and lifestyle have been so closely linked in our psyche it has caused a strange thing to happen. When we have things going on in our lives that are difficult, it’s easy to imagine that our problems would disappear if we had more money. The first step to money mastery is to recognise that money can only bring good into our lives in a very limited way. When you let go of the idea that it can solve every problem, you open your mind and start seeing other ways to be fulfilled. When you start to create that mindset, the irony is that you see more opportunities to create abundance and wealth.
Hypnosis is sometimes seen as a solution. Do you believe in it?
I do believe self hypnosis is helpful sometimes. Whether you label that as meditation, mindfulness or even prayer, it doesn’t matter. Good money management is simply good management of yourself and your life. I acknowledge that not everybody in the world is born into the same freedom of choice. Yet when I was researching this book, I discovered some astonishing stories of women who have overcome incredible odds in countries where opportunity is very limited, who have had an amazing impact and secured their own financial future as well.
Why do intelligent women spend more than they should?
Most intelligent people are highly sensitive to what other people think. That hyper awareness often puts women under self-imposed pressure to spend on things they could really do without, so they are seen to match up with the impression they would like to make about themselves. Also, women with a high IQ are often very confident that they can earn more and balance the books later. The trouble is that the world doesn’t seem to work on your side when you need it to!
The other element is that intelligent women sometimes believe they understand the credit system and how they can play it in their favour. The trouble is that no one can understand every different credit system. Debts can quickly spiral and the most intelligent woman can struggle to keep up when the repayments start to make an impact on her monthly finances. An unexpected event can rapidly turn something manageable into a major crisis. For example, the loss of a job, or illness in the family.
What about men? What are their financial potholes?
I believe men are culturally programmed to be providers and so when finances get difficult it can be hard for them to admit that they are struggling. They also have to contend with a great deal of pressure from other men to keep up their image and status. That can make it very hard for them to admit to having problems. It’s not unusual that when men lose their jobs they don’t tell the family until the last possible moment. There is more social pressure on them to work and the loss of income can hit them really hard emotionally — and showing those emotions is often frowned upon by other men.
Is there a difference in how men and women approach money?
Yes, I believe there is. Men are more inclined to use money as a way of keeping score of their success and their role as a provider. They are more status driven then women. It’s not a bad thing, it’s just in their DNA. It’s not just other men they need to impress. The good provider is a good catch for an ambitious woman. There is a level of deference given to wealthy men and a healthy respect for self-made wealthy men, and who wouldn’t want that?
Women, on the other hand, measure the importance of money by the security that it brings. Large amounts have less attraction because it’s not so much about what they have, it’s more about what they don’t have to worry about! Women are very good worriers. That’s why they are often good at managing household finances. We learn from an early age that becoming independently successful can be harder for us, so we tend to take care of the little things. It’s not that we don’t get into debt, we do. It’s more about the fact that we tend to think a little bit longer term and in general take fewer risks with our money.
Why did you call your book Money Bondage?
After years of struggling to get out of debt, I knew that money trouble does feel like being chained down. The feeling of freedom when I finally got ahead financially was so liberating that I almost felt like a new woman. Money Bondage is about more than money; breaking free from it is about breaking free from the mindset that holds us in difficulty. When you discover the power of choosing how you think, it’s not just your bank account that benefits, but your whole life.
What’s the one thing you want to get across in your book?
The biggest message is about personal responsibility. It is delivered gently, in a way that won’t offend people and will encourage them to think about themselves in a positive and honest way.
