Savvy Psychologist The psychology of money: How your brain, history, and emotions influence your financial habits
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Oct 15, 2025 Money is more than just numbers; it’s an emotional landscape influenced by our childhood beliefs. The concept of mental accounting explains how we categorize our finances, affecting our spending decisions. Discover the intriguing phenomenon of doom spending, used as a form of emotional regulation. Research shows that experiences bring more happiness than material purchases, while optimism can enhance savings and reduce anxiety. Learn practical strategies to change your money story and make mindful spending choices aligned with your values.
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Childhood Shapes Money Beliefs
- Money scripts are unconscious beliefs about money learned in childhood that shape adult choices.
- Identifying these scripts lets you challenge and rewrite your money narrative.
Your Brain Puts Money In Buckets
- Mental accounting is how the brain sorts money into labeled buckets like rent or fun funds.
- These labels change how you spend identical amounts even though value is the same.
Bills Feel Different By Size
- The denomination effect makes large bills feel more painful to spend than many smaller bills of equal value.
- Use this perception strategically by carrying larger bills to curb impulsive purchases.