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Personal Finance: The toxic sludge of a poor financial attitude

Danielle Howard
Personal Finance
Danielle Howard
Staff Photo |

As we drove from Silverton to Durango we paralleled the puss-yellow slime that had oozed into the Animas River. My heart sank and stomach churned as the clear, Rocky Mountain blue-green was consumed by the opaque ugliness. We knew it wasn’t good. Something had gone wrong, and it was going to have a detrimental impact on the environment and the people who use that river for drinking and recreation. This past week I had the same initial jolt when I saw the Roaring Fork river that runs past my office turn a foul shade of brown.

Money is like water. It flows through our lives and can be used as a source of life, sustenance, refreshment and enjoyment. It needs to be directed, or it will dissipate into vapor. It is a conduit of our intentions and can be clean and clear or cloudy and filled with ill-regard. Water and money are good, unless something goes wrong.

What toxicity can infiltrate and permeate our financial lives, and what can we do to mitigate or eradicate it?

In her book “The Soul of Money,” global activist Lynn Twist shares three toxic financial mindsets that need to be humbly recognized and fervently battled. The first is “there is not enough.” A scarcity mentality will rob you of appreciating and enjoying what is right before your eyes. If we wisely steward what comes into our lives and become intimately cognizant of our choices in giving, saving, investing and spending, we cultivate a mindset of abundance and sufficiency.

A second toxic attitude is that “more is better.” We see this manifest in our business culture and in our personal lives. Do what it takes to get the stellar rate of return for our shareholders, or surpassing the Joneses still dominates many a conviction. Entrepreneur and philanthropist Frank Hanna encourages us to consider how much is enough in his book “What Your Money Means, and How to Use it Well.” In considering bare necessities, genuine and profession-related needs, and discerning what are true beneficial goods, there is an inflection point, and a diminishing rate of return on happiness. As confirmed by Arthur Brooks at the American Enterprise Institute in his research on happiness, more money is not the answer. The Great Salt Lake and the Dead Sea are endorheic — water flows in, but not out. Nothing thrives in those environments. Money, like water, needs to keep flowing. The question is how do you want to direct it? It is not about accumulation but appropriation.

The third toxic belief is “It’s just the way it is.” This is a victim mentality. This can be an entitlement frame of mind from both the “haves” and the “have nots.” The question is: Just because you can, should you? Just because you have been blessed with business acumen and ridden a wave of wealth, should you exploit those who work for you, or the environment? Just because your circumstances have availed you to the governmental support system, should you intentionally stay there because it is convenient for you? We are the beneficiaries of a free-market economy, a rules-based legal system, property rights and a functioning democracy (no snickers, please). Our freedoms have given us the opportunity to resourcefully, creatively and ardently pursue a way of life our ancestors never could have dreamed of. We need to prioritize the cultivation of human dignity and self-worth over net-worth.

Other sediments of a lethal financial mindset include fear, greed, concealment and resentment. We have the power to do something about it. I appreciate that those who caused the catastrophe on the Animas have taken responsibility and are moving quickly to reconcile and resolve the problems. We know the domino effect will play out for years to come, but the process of cleanup has started. We have the opportunity to create clear, healthy courses of money running through our lives. We each need to wade into our financial flow, recognize areas of concern, and start the diligent efforts to clean it up. We also need to appreciate the healthy areas and put safe guards and protocols in place to keep the lethal mindsets and behaviors safely at bay.

Danielle Howard is a Certified Financial Planner practitioner. Her office, Wealth By Design LLC, is in Basalt. Visit her at http://www.wealthbydesign4u.com. Advisory Services offered through Cambridge Investment Research Advisors Inc., a Registered Investment Advisor. Securities offered through Cambridge Investment Research Inc., a broker/dealer, member FINRA/SIPC. Cambridge and WBD are not affiliated.


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