Confronting Your Past

This post is adapted from YNAB's twice-monthly newsletter, Loose Change. 

There’s this person that keeps following you around the store. Don’t freak out; it’s not a stranger and they mean you no harm. It’s your past. 👋

“Oh hey, remember how you majored in philosophy? And made zilch at your first job, then remained incurious about 401(k)s for a long time?

Yeah, cool, just wanted to remind you of all that. Wow, that’s kind of an expensive T-shirt…”

It happens—our past intrudes—when we scroll through houses on Zillow, when we park next to the really nice car. It’s that moment when we bump up against our financial constraints and feel a surge of frustration or disappointment at the doofus we once were.

We ‘inherit’ the choices and circumstances of our past. Whether we like it or not.

I have a family member who declared bankruptcy in his early 60s. What began as a job loss was followed by physical and mental illness, years of unmoored spending, and increasing isolation. Other family members tried to talk to him, to help him, but though he could talk at great length about anything, he would not talk about money. The size of his debts grew and the collectors became more aggressive until he was forced to declare bankruptcy. He was allowed to keep his house because it had fallen into such disrepair.

The consequences of our past are quite real, but the stories we tell about ourselves may not be. Even without the awful experience of bankruptcy (almost 500,000 Americans filed last year), many of us imagine it would’ve been so simple to have taken a different financial path. How could we have missed those opportunities? As if “personal responsibility” was a test, announced in advance, that you took in a quiet classroom with a #2 pencil. As if my family member wasn’t fighting against his illnesses, in a tempest of stress.

Of course, having compassion doesn’t change the fact that what we did yesterday affects today. And what we do today will affect tomorrow. It’s true.

But judgment is like an invasive weed that has gotten into personal-finance and seeks to fill every moment of underwhelm or disappointment. Judgment is always trying to create a villain and tell a simple story when the past was much more complex. Look back on your own history and you might see a lot of regrettable choices, but a villain? Bad intentions? Nope.

At the risk of invoking Stuart Smalley, I think part of what makes a healthy relationship with money is that we try to enter into a loving relationship with our past self. Why? Because if money is an extension of us, when we hate our past spending we hate ourselves. And how are you going to fund the life you really want if you don’t even like the person living in it?

Discover the hidden layers of your financial habits—they run deep! Take YNAB's free Spending Personality Quiz and gain a fresh perspective on your relationship with money.

YNAB IRL: Looking Ahead With Confidence

‍Meet YNABers Brian and his wife, who hail from Tennessee and grew their family "without being stressed about money."‍

Six months ago, I leveled with myself and admitted that I wasn’t as financially “on it” as I was pretending. I would take my wife out for dinner, then get stressed, not knowing if we had spent too much on a date. I would look at a grocery receipt and then reflexively declare dinner to be pancakes for the foreseeable future. I felt like we were "fine," but didn't know what fine meant and if we would have enough saved for vacations or other life events.

For me, these were random attacks of money stress (or RAMS for short), and they would just decide to charge at me for the silliest things. And so, because I kept getting head butted by a growing heard of RAMS, I decided to keep track.

Last month, my wife got pregnant! We are so excited!! We had been trying for so long and are just thrilled to be parents. The YNAB silver lining? The night we found out, I looked at our budget, took a deep breath, and said “yeah, we can totally do this.”
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My wife and I can talk about money now! We no longer blame the other for spending more because we now make decisions collaboratively. And I have stopped getting randomly stressed about money and declaring it "pancakes for dinner" night.