Financial therapist Erika Wasserman explores how early money experiences shape today’s decisions.

To learn more visit yourfinancialtherapist.com or check out Erika’s book, “Conversations with Your Financial Therapist: Stories and Scripts to Grow Your Mindset” now available at Amazon.com.

Hi, I’m John.

And I’m Julie.

We’re the hosts of the Hartford Fund’s human-centric investing podcast.

Every other week we’re talking with inspiring thought leaders to hear their best ideas for how you can transform your relationships with your clients.

Let’s go.

Erika, welcome to the Human Centric Investing Podcast. We’re so excited to be here with you today.

Good morning, I’m excited to be here. With you all. It’s going to be such a great conversation. I love talking about money.

Oh, that’s great because we’re in the money business, but Erika, it’s funny you say that because oftentimes when Julie and I are out on the road talking to financial professionals, I think they share with us that money is like 30% of their job and therapy is 70% of the job. So it’s great to have you on the podcast today because we really wanna understand. How emotions impact money decisions, and really how far back does our relationship with money go? And what have you seen in terms of money issues that people have? How much of those issues are often rooted in experiences from much earlier in life?

Well, everything you just said we could talk about for at least three hours. You settled in? You ready?

All good.

The first thing that I heard is for financial professionals, when you’re out on the road, talk about the emotions that when they meet with clients is so much time that is involved. And being a financial professional, you know, when we’re in school, I have a finance degree, right, is you learn the numbers part of it. You know, I was great at math, I like math, nobody sat me down and showed me how to talk to people around money, and the sensitive side. And luckily, my background, which we’ll get to in a little bit. Is what helped me enable these conversations. So when I meet financial professionals out in the field and I say, oh, I’m a financial therapist, they laugh and I get like a pat saying, oh so am I, that’s how I spend my day. And I’m like, no, no really, like I’m a certified financial therapist. Let me help you by taking your clients away to spend some time with them to understand the emotional side of money so that way you could get the logical decisions that you wanna make with them. That’s what you wanna do in your job is you wanna make logical financial plans for people and, you know, skip over the passing the tissue box and having somebody cry at your desk. Right?

Yes, ma’am.

Yeah. So yeah, so there is a field now called certified financial therapy. And that’s what I work on. I leave the dollars and cents to the financial professionals. And I work on all the other senses, both for the advisor, because hello, your people too, right? We all got our own money issues going on. And for the clients, Julie, you giggled at that you got some financial issues going on?

Well, I just, I think about, I grew up with my mom on Sunday. We clipped the coupons and the Sunday paper and then organized them in alphabetical order. And then we would go to the grocery store and see how much money we could save. And so to this day, I have such a coupon mindset. I’m having a hard time shaking it. So that’s why I was chuckling.

But that’s okay. So that is such a perfect segue into how do we get our money mindset. So you grew up in a household that on Sunday, not on Tuesday, right? It was Sunday when the coupons came out. You went and sat at the kitchen table probably with your pair of scissors and everybody cut out what they wanted to buy that week.

Exactly. And then we, you know, those little expandable alphabetical folders, we would literally organize them. So we had them ready to roll when we stepped into the grocery store.

Yeah, and so part of our money mindset comes from our background. So for you, that’s great. Now in life, if you meet a romantic partner who’s never used a coupon, whose job was to go to the grocery store, family went to the store on a Monday night and threw stuff in the cart, you too might not see eye to eye on some of your financial decision making. Because.

It’s been a process, we’ll put it that way.

Oh, you did that, huh?

Why didn’t you buy this one that was on sale?

Right, because we get our money mindset from our background, nailed it on that one with the coupon story. Thanks for that setup. And the other one is religion and culture. So this plays a big part, especially as we’re seeing the generational wealth with women come about, is, you know, we’ve talked about it, you’ve heard it 50 years ago, women couldn’t open up a line of credit, couldn’t rent an apartment. So I started thinking about that. That was my mom. My mom has a PhD in education. Her first job teaching, she couldn’t rent her own apartment. In fact, when she got her paycheck, my grandfather had to open up the bank account with her.

Wow.

Isn’t that wild? I mean, this wasn’t that long ago. And then she’s like, well, then we got married and your dad and I had a joint bank account. And I’m thinking, yeah, I was joined under his name, right, until she could get her own credit. So we have culture. Especially women, don’t necessarily have confidence in relationship with money, because it wasn’t their role. Then let’s add in religion, which we hear a lot about, you know, men are ultimate decision makers, you also have money is greed, it doesn’t buy happiness, and you could take it from Islam, Judaism, you know Christianity, you give to charity. There’s money messaging in there that’s embedded back to our early ages.

So, Erika, you mentioned you had a degree in finance. Share with us a little bit. What was your journey to financial therapy from really kind of getting your grounding in finance? What got you interested into it and kind of what directed your steps?

Yeah. So like Julie, for me it was my household. So I grew up in a nuclear family, mom, dad, a sister, myself, but my dad and I clicked over math because I liked math. Yep. Total nerd. Love it. And every time we’d go to the grocery store, turned into a financial conversation. Two cans of beans are 99 cents. How much is one can of beans? And then we’d go to check out counter and he’d pull out the money and I’d have to count the change. And so talking about money just became natural for us. And as the years went on, this conversation shifted. And I started trading stocks with him at 12 and 13 years old. And so when I ended up with a finance degree from the University of Florida, it just was the natural fit for me to go into this field. I then ended up, we’re gonna go on a roller coaster ride because I don’t know about you, but my life has had ups and downs and twists and turns. And so I thought I was gonna go into finance and I did, I went into IBM into consulting and I spent the next decade. Working in IBM, in New York City, in Japan, in China. I got married. I had my first baby in Tokyo. Amazing experience. Moved back to the US, had two more kids and here comes the roller coaster ride. Real quick, whoosh, was told I was getting a divorce. So I had three kids under the age of four, left consulting because having that type of job, raising three children was not feasible for me at that time. And had to reinvent myself again. And so I started working with entrepreneurs growing businesses because entrepreneur mindset is great at one thing, but not necessarily at building a business. And so, I started with them and about 10 years later, after my father passed away, my mom had the traditional relationship. So we both know where the binder was, but she didn’t know what it was inside. You ever have clients like that? And so over the next year or two, I started helping her gain confidence with what was in there. What did the stocks mean? What was the insurance policy for? Who the players were? And then I heard the term financial therapy. And it was like the lightning went off for me. And I was like, this is how I can help people have these tough conversations or ones that they’re uncomfortable with that didn’t have the same background like Julie and I had of like, just talking about money at a young age. So I went to Kansas State and got certified in financial therapy. And then join the Financial Therapy Association, and I’m one of 100 in the field. And it’s growing because, as y’all know, talking about money is so key into making logical, strong, long-term decisions.

Thanks for that.

Yes, that’s fascinating. I’m just thinking about a financial professional sitting down with a client and maybe they’re trying to make a decision today about a retirement plan or something that’s going to help this client’s future. And the financial professional can’t seem to get through to them. Chances are, right, it’s rooted in something that happened earlier in their life. Or maybe they are either. Emulating a behavior or maybe they’re rebelling against a behavior, right, saying, I don’t ever want to be like this situation that I experienced growing up. How can a financial professional begin to crack into some of that, especially if that client hasn’t really reflected on those past experiences and maybe connected them to what they’re thinking today?

Yeah, that’s a great question. Because before, before the individual even walks into your office, or you click on zoom, they’re having a feeling about meeting with you. It could be a sleepless night, it could be uncomfortable, you can see the body shifting. For you, it’s just a Tuesday at 10 o’clock. And better get going because I have an 1130 right after you and we’re gonna have the same conversation day in and day out. For that person that’s walking in, they might only have one hour and 52 weeks. Spend one hour every 52 weeks having this conversation. And so for them, it’s oftentimes you’re gonna notice in body language first. So make them comfortable. Think about when you had a productive conversation with that client. What time of day was it? Was it early in the morning before they had decision fatigue. Was it before lunch, right? Nobody wants a hankery client, or was it at lunch? Thinking about that and the client that’s showing up for you will help get them comfortable as well. So that’s really important is meeting them where they are. And I know it’s busy. We want to keep moving on and on and on, but comfort is important. So time of day location is key. And if you see them pulling away, literally, even on zoom or in, in person, You see them sitting further and further and farther back. Think about ways that you can engage with them. And a way I encourage people is storytelling. How did you spend a Sunday morning as a kid growing up? Julie’s gonna jump in and tell us about her couponing. John, how did you spent a Sunday morning growing up.

Eating dried out roast beef and boiled potatoes at my grandmother’s house.

Right.

But we didn’t talk about money. We waited for football to come on.

But that also says something about your background too. And then you can start opening up dialog once the guard comes down a little bit. So I always like storytelling conversations to help put the client at ease. That’s a great start. And it could be any type of topic. Just tell me a story about and let it go.

So, Erika, I’m guessing as I think back about my own experiences and maybe the folks listening today start thinking about their early money experiences, how many times is it really the negative experience versus the positive that really sticks out in our mind and shapes us? And I know you talk about kind of reframing experiences. Can you talk to us a little bit about what you mean by that? And is it really the negative experiences that really have the most impact?

Oh, absolutely. We tend to recall the negative messaging way more times than the positive messaging. And so let’s go to if you’ve ever sold a stock before, because man, did you lose a ton of money. And then your advisor comes back to you, your financial professional comes back to you and says, we’re going to reinvest in this industry. Your alarms might go off. No, no, no. That one, that gave me sleepless nights. Completely different stock, completely different product, but your emotional tie to it is overriding the logical piece to this. And we see it time and time again, and people will come in, not just with their financial trauma, but their parents’ financial trauma as well. The messaging that they’ve received. And so the negative sticks a lot longer. So then you have to reframe that. How do you reframe the conversation? Is what I like to say, is this fact or fiction? Fact, you lost money in that stock. Fiction, the whole industry’s crap, right? So fact is we could still reinvest in this area if your values align, that’s a fact. And so when you start taking out the noise and the emotion and stick to the facts and the fiction, you’ll get a clearer picture, not just for you, but for your client to feel aligned with that direction again. And reframe their mind to be able to invest.

That’s so interesting. I love that fact or fiction. I mean, I think it just really helps start to put some process around this. I know when we’ve spoken before, you have an actual method that really exercises that financial professionals can use to help clients uncover maybe limiting money beliefs. Will you walk us through that method?

Yeah. So I think you’re referring to the swan method. Yes. So swan stands for sleep well at night. I don’t know about you, but I love a good night’s sleep. But what happens when we get ready to go to bed? That’s when our mind quiets down and we start tossing and turning. And then we turn to our partner and start having all these really great conversations at inappropriate times, because one person’s grumpy asleep or not the right setting. So to help you sleep well at night, before you get there for yourself or meeting with the client, we’re gonna use the word swan. So S, set a goal. What’s the goal to meet with your client? Or what is your client’s goal? Then we’re going to go to W. Why is that important? So we’re gonna set a goal. We’re gonna know why it’s important. And then, Julie, we’re going to come back to our facts and fiction. We’re going analyze fact from fiction. So if you’re having trouble sleeping at night before you go to bed as you’re winding down, grab a piece of paper, old school, or grab your phone, write it all down. What’s keeping you up at night? Then go back and write TRF next to it. The ones that are false, we’re gonna worry about another day. The ones are true, well then we’re going to go to the end which is navigate options. And that you can navigate with yourself, with your financial professional, with your business partner, and that’s gonna help you sleep better at night. So SWAN, set a goal, understand your why, analyze fact from fiction, and then navigate options.

Erika, where’s the middle ground between, I’m a financial professional engaging my clients on financial planning and putting portfolios together and all the traditional stuff, and somebody that really needs somebody more than me, like a financial therapist to analyze, like, what should I be trying to do as a financial profession? How deep into understanding these experiences should I go? Because i’m somewhat concerned about getting over my skis do i really want to go down a trail that i don’t know if I’m equipped to handle so how should i manage these conversations.

Great question, John. And I think the reality is everybody’s going to be different. There’s going to some people that are more comfortable on the human centric side. And there’s going to be some people who are comfortable more on the mathematical side. And that’s what makes us all unique and what clients attract to you. So that’s first. If you’re outside your comfort level, either get training to expand more because growth comes in the uncomfortable or know who to refer to. I think that those are two key messages. Because part of being a financial professional is the relationship. You know, today with AI and bots and everything, people can put numbers and invest on their own. They’re investing in you as a human. So the way you connect with your client is what’s gonna keep them coming back to you. And every advisor connects differently and every client connects differently. It’s interesting. I’ve heard, maybe you have too, pick advisors the same way they pick romantic partners. Have you guys heard that? No. I have not. But then when you take a step back, and I’m going to speak for myself, right? We like to be part of the problem solving. We like to be heard. We liked solution. We’re like, you know, the talking together. And when you find an advisor that matches that energy versus showing you the end product. Oftentimes, men want a result. Right, give me the end product, it’s 10% return, great, do it. Women wanna be part of the process and so they’re finding advisors that relate to them. So it’s very interesting, back to your question, John, it’s going to be where you can meet your client and where you honestly wanna be, what personal growth you wanna have here.

That’s so interesting. I’m curious, Erika, from your perspective, if I’m a financial professional listening to this right now, thinking, you know, I think I asked pretty good questions. I think, you now, I maybe uncover some of this, but I would like to do a better job. What are the one or two questions, or, you, know, obviously the story part we’ve talked about, but are there a couple of... Uh, you know, beginning points that you would recommend that a financial professional start to weave into conversations, right? They may not want it to feel incredibly different, right. Like, you, who were you yesterday and who are you today? But how would you start to leave this in maybe to ask better questions, to peel back a few more layers with clients, if you are a financial professional that just wanted to do a better job of discovering some of this?

First question is what is money mean to you? Right off the top of your head. And it’s interesting, I just presented this last week, the whole crowd, everybody had a different word. And so find out where they are with money. The other fun question that stumps everyone, what’s your favorite bill to pay?

Wow. These are excellent questions.

You guys have one?

Can I answer none?

Okay, see, now we’re talking, right? Now we’re having a real conversation. Because if I drill into it, like for me, when I was younger, I’m a single mom with three kids, it was my nanny, right? Because I needed a second set of hands. And I would rather, that was my favorite bill to pay. And now it’s travel, or the roof over my head. And so we start reframing what we do I enjoy spending money on. We’re able to focus on the good thing. So now John, what’s your favorite bill today? It could be anything, your golf membership, what is it?

Bingo, golf dues. Yeah. There you go. golf dues. Good times with friends and family.

Julie, how about you? Probably my marina bill just because it’s for our boat. And so our monthly rental, and at least it’s our happy place.

So when you pay that bill each month, it feels different. And so when I work with clients, we take out the negative ones that we don’t like paying. Why don’t we like paying them? And can you reduce that spend to put more spend in the stuff that you enjoy? And one guy I did a hit the streets asking people once had this FPNL bill because he likes a hot shower every day. It’s his favorite bill to pay, right? And so, when you’ve reframed some of these conversations. You’re able to enjoy the money that you are spending. Now, clients came to me saying, I didn’t know how to start the conversation. So I was at a bar one night, like most good ideas come. There was a couple next to me doing conversation cards. And so I created Let’s Talk Finances. And so these are conversation cards, and so I have a lot of advisors that leave them on their desk. And when a client comes in, they’ll just pick a card up at random. And the questions that we asked today are in there, along with 50 others. So it just gets a conversation going kind of makes it informal. There’s also a divorce addition as well because when you go through a divorce, you have to reset your financial goals and oftentimes your financial mindset.

Makes a lot of sense. Well, Erika, you just gave us a couple of really good questions to think about. Now, if you’re okay with it, it’s Julie and my time to ask you some questions, which we call the lightning round. So the purpose of our questions is really to help our audience get to know Erika a little bit better as a person, not just as a financial therapist. We do it with many of the guests that join the podcast. So if you’re game, I’ll ask Julie to fire away the first question.

All right, let’s go.

Okay, what’s your go-to Karaoke song?

You don’t want me to karaoke.

I’m right there with you, trust me.

I’m the best backup dancer for anybody who’s on stage though.

There you go. How about on a scale of 1 to 10, how good of a driver are you?

I will say an 8.

Good.

What’s your favorite app on your phone?

Instagram.

If you could swap lives with anyone for a day, who would you choose?

Ooh, JLo just came to mind. That was the first person who popped in.

That works.

What’s your superpower in one word?

Napping.

What’s your go-to comfort food?

Chicken parm.

Nice.

Yeah.

I’m hungry.

Hands down.

What’s one thing you always pack when you travel?

A toothbrush? That’s all I need. I could get lost anywhere in the world. All I need is a toothbrush.

That’s a great point.

My last question for you, because you mentioned that you traveled quite a bit earlier in your career. If you could, what’s your favorite city that either you have been to or that you would like to go to in the world?

Oh, that’s like picking a favorite child. I’ve been to 48 countries.

Wow.

Yeah, I lived in Japan and Tokyo for two years. So I’m gonna go with Tokyo. I would love to spend more time there.

I’ve heard it’s terrific. I’ve never been.

Erika, we can’t thank you enough for joining us today to share your insight and wisdom. And for our listeners, if you’re interested in learning more about Erika, feel free to visit her website, yourfinancialtherapist.com, or feel free buy her new book. It’s called Conversations with Your Financial Therapist, Stories and Scripts to Grow Your Mindset, and it’s available at Amazon. Thank you again, Erika, for sharing with us today.

Thank you. This was a blast.

Thanks, Erika.

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The views and opinions expressed herein are those of the guest who is not affiliated with Hartford Funds.