Your money scripts are your invisible beliefs about money often formed in childhood. They play a big part in financial decision-making. Understanding money scripts is crucial to achieving your financial goals. In this post, I explain money scripts and how to use yours to your advantage. Any financial plan you forge must consider your money scripts.

Why are money scripts the most important, least discussed part of your financial freedom plan? Consider:

Academics once believed that “rational humans make financial decisions based on logic and fully available information.” No longer. Humans are not robots. For most of us, human emotion (often very irrational) reigns supreme. Money scripts help us understand our own irrational money behaviors.
Money scripts fill a gap in financial planning. A plan is only as good as our ability to apply it. A complete financial plan is personal, comprehensive, supported by math, and actionable. Our actions need to match our emotional capabilities — as influenced by our money scripts.
Often, our first money challenges show up as disputes with life partners. Money scripts explain our unique money perspectives. When we understand our scripts, we see how a partner may have had different experiences with money. Then we can take steps to align our views where possible.

Unraveling our invisible money beliefs empowers us. We can make informed, conscious financial decisions that align with our values and financial goals.

The TL;DR is about making the invisible visible

Money scripts are invisible beliefs you likely didn’t know you had about money. Your scripts define how you view money.

Though often portrayed in a negative light, these four high-level money scripts are not inherently bad:

Money avoidant implies you are not prepared because you ignore money. But I disagree: You clearly understand that money isn’t everything! Money shouldn’t be central to living a happy and fulfilled life.

Money worship implies you are a money-grubbing Ebenezer Scrooge. But I disagree: Money worshippers are great at building wealth. With lots of money, you can do great things in the world.

Money status implies you have big houses, fast cars and are in massive debt. But I disagree: You believe there will always be more money out there. It’s the classic growth mindset. This outlook helps you shoot for the stars.

Money vigilance catches a break. Yes, you are a strong saver. But it also implies you are miserly and selfish. I disagree: You exhibit many healthy money behaviors. You save. You’re financially prepared. You look for value. Stay balanced in your approach to be successful.

“Any financial plan you create has to align with your money scripts. Money scripts capture the human nature of your financial success (whatever success means to you).”

Take these four steps to rewrite your money scripts and your personal financial success story:

Understand money scripts and their pros and cons
Make your invisible money scripts visible
Consciously develop your preferred money scripts
Acknowledge the scripts in your financial freedom plan

Let’s get started…

Those formative years pack quite a punch

What is your first memory of money? Did your parents teach you to save? Did the family business fail? Was your mom or dad a super-duper coupon clipper?

Your childhood experiences left a mark on you… a mark that impacts your relationship with money (even more than you know).

Money scripts defined:

“Your unconscious beliefs about money, often rooted in childhood, that affect your adult behaviors and perspectives.” — Dr. Ted Klontz, 2011

I come from a typical midwestern, middle-class family. We didn’t go without. We weren’t extravagant. We visited a restaurant only once or twice a month. We never ordered appetizers or desserts. I learned the value of saving and compound interest from an early age. I opened a passbook savings account when I was 10. I knew to fund my 401k the moment I got my first real job. I’ve been saving ever since. I couldn’t understand why others wouldn’t…until I discovered money scripts.

I learned that my primary script is money vigilance, and it comes with advantages and disadvantages.

As you read on, think back to your childhood experiences and other financial flashpoints. Those experiences played a formative role.

Understanding the money script framework

Most of what’s written about money scripts centers on the four major types. I call these: the four money “super” scripts. They cover the full inventory of 32 money scripts that I share near the end of this post.

A playwright’s script is comprised of key elements like setting, characters, plot, and theme.

In this section, I break down each money super script into five key elements:

Maxim — The essence of the super script in a memorable quip
Mindset — Inside the mind of someone who lives in this way
Mark of — Characteristics of these types of individuals
Mind — Be cautious when living life in this way
Moderation — Maintain balance along the range of behaviors

As you review each money super script, think about where you fall on the spectrum, from [Not at all] to [Yes, a lot].

Money avoidance

“Money is the root of all evil.” “Greed is not good.”

Is this you?

“I don’t deserve money.” Often, this stems from inheriting a large sum of (unearned) money.

“Money is bad.” or “Money is the root of all evil.” Money breeds greed and brings out the worst in people.

Mindset: Individuals with a money avoidance mindset view money as inherently evil or believe that they don’t deserve to have it.
Mark of: You may avoid dealing with financial matters or be uncomfortable with wealth. You may self-sabotage financial success due to negative associations with money.
Bear in mind: You may experience financial denial, financial rejection, and excessive risk aversion. You may underspend. Money is only a tool to help you live your best life. High avoidants must always remind themselves of this.
Why moderate? When ignoring money challenges, minor setbacks can lead to terrible outcomes. Avoidance, no matter the subject, is generally ill-advised.

Money worship

“Money makes the world go round.” “The grass is always greener with more money.”

Is this you?

“Money buys me freedom.” I couldn’t agree with this more. But money isn’t often thought of in this context.

“More money will make me happier.” This is true to a point. More money can erase tragedies like eviction notices and skipping meals. After that, happiness isn’t guaranteed. I’ve met a few ultra-wealthy people who are unhappy.

Mindset: Money worshipers believe that wealth will solve all problems and bring happiness.
Mark of: This mindset may lead to excessive materialism or a constant pursuit of wealth. You likely believe that financial success is the key to a fulfilling life.
Bear in mind: “More money will make things better” is a common belief among Americans. However, economic gains in the past few decades were not accompanied by improved life satisfaction. Money worshiping may lead to unreasonable risk-taking, hoarding, pathological gambling, and workaholism.
Why moderate? Money worship is not all bad. Money spent on experiences that further connections with those you love can bring happiness. Your expensive but memorable vacation is worth it!

Money status

“You are what you own.” “Keeping up with the Joneses.”

Is this you?

“There will always be enough money.” This money script permeates the thinking of those who have experienced wealth or success.

“I deserve to spend money, I’m worth it.” My non-money version is, “I deserve this donut. I’ve eaten healthy all week.” This script can lead to overspending (and overeating).

Mindset: Money status seekers often link their self-worth to their financial success and the possessions they own.
Mark of: You may engage in conspicuous consumption to boost your social standing. Your sense of identity and self-esteem is strongly tied to it.
Bear in mind: You may be hypercompetitive. Be careful because materialism has been associated with less vitality and unhappiness. It can also lead to anxiety and illness.
Why moderate? Money may motivate you to be successful or build that next great business. But money as your only yardstick of success is not good. Someone always has more. Someone always has that bigger inground pool…

Money vigilance

“A penny saved is a penny earned.” “Always save for a rainy day.”

Is this you? (I’ve included four since my audience is steeped in the vigilance super script. ->)

“Money should be saved, not spent.” This describes childhood-me. I saved every dollar I received. But doing so also made me a leach to others.

“Always find the best deal even if it takes a long time.” Both hardcore optimizers and budget-conscious families live this line.

“You shouldn’t talk about money.” Money and wealth are private matters. But secrets make you vulnerable to financial scams.

“People should work hard for their money and not receive financial handouts.” This view can lead to overworking. If you believe this, you probably never give a dollar to someone in need. (This is me, and I’m not proud of it.)

Mindset: Money vigilance denotes a cautious but sometimes anxious approach to financial matters.
Mark of: You are a diligent saver, think often about financial security, and are discreet about your wealth. You may be hesitant to discuss financial matters openly.
Bear in mind: For you, money may be a deep source of shame or secrecy, whether you have a lot or a little. This encourages saving and frugality. But excessive wariness keeps you from enjoying the benefits and sense of security that money can provide. It’s also very isolating.
Why moderate? Saving for an unknown future is essential to winning time-freedom and living a great life. But keep communication open!

Now I reveal the perfect money scripts

If you’re like me, you’re now thinking:

“Wow, my parents did a number on me. It’s no wonder I act the way I do around money.”

Or…

“I guess my partner isn’t all wrong in how they approach money. It’s merely a different way of seeing things.”

Even so, I still catch myself trying to identify the optimal money scripts. The lesson I take from what I read online:

Money avoidance — Bad
Money worship — Bad
Money status — Bad
Money vigilance — Good

It is far more nuanced. In fact, I argue that every money script has value…and every money script requires caution.

In my mind, the perfect money scripts are:

Known by you and your partner,
Balanced, no matter the money beliefs you hold, and
Aligned with your life purpose.

Let me explain what I mean. I highlight five personas with very different, yet all excellent, money scripts.

Sarah, the conventional professional

Sarah leads a traditional, professional life. With a middle-class income, she is diligent about saving in her 401(k) and plans to retire at 65. Sarah’s approach reflects a balanced and traditional view of personal finance. It ensures financial security through consistent savings and responsible planning. Upon retiring, she looks forward to using her money for travel and charity. She also plans to leave a small amount to her children.

Seeking balance: Sarah lives a safe, savings-focused lifestyle, yet she’s not stingy. While her life may not be exciting per se, she’s happy and finds joy in what she has.

She’s mostly money vigilance.

Ethan, the extreme saver, and early retiree

Ethan adopts an extreme savings mindset, sacrificing immediate luxuries to retire early. He accumulates enough wealth to retire well before the typical age through frugal living and aggressive saving. This lifestyle allows for a prolonged period of personal freedom. He can pursue his passions from a position of financial stability. Ethan has found a spouse and a collection of friends who adhere to the same lifestyle. He wants to use his early freedom to make the world a better place.

Seeking balance: Living well below one’s means works well if it doesn’t damage personal relationships. Time freedom allows Ethan to focus on the important things in life.

He’s mostly money worship.

Olivia, the high-earning, high-spender

Olivia makes a large income, indulges in a lavish lifestyle, and chooses not to save for the future. Olive is a therapist to the LA-rich and famous. She loves her work, gets great personal satisfaction and social status from it, and wants to do it until the day she dies. Olivia prioritizes immediate gratification over long-term financial security. She showcases a legitimate choice for finding satisfaction in the present.

Seeking balance: Olivia has chosen to live life in the moment and to its fullest. She loves staying busy and cannot see herself ever stopping. She wants to work forever, which is a respectable way to contribute.

She’s mostly money status.

Max, the risk-taking entrepreneur

Max is on a journey of taking significant risks. He has started many businesses, faced failures, and even gone bankrupt. Max embraces the entrepreneurial spirit, understanding that success may come after several setbacks. He hopes his willingness to take calculated risks will lead to striking it rich. He showcases the potential rewards of persistence and innovation.

Seeking balance: Max goes big (or goes home). Bankruptcy is legal. He learns from successive failures. Ever the optimist, Max sees his ultimate success as bringing enjoyment to his customers and meaningful work for his team.

He’s mostly money status.

Aisha, the philanthropic minimalist

Aisha dedicates her life to giving back. She is generous in donating her income to help others, accepts support from the community when needed, and lives a modest lifestyle. She will rely on social security in retirement. Aisha commits herself to kindness and altruism, finding fulfillment in making a positive impact on the lives of others.

Seeking balance: Building great wealth has no appeal to Aisha, though she never intends to spend beyond her means. She gives financial help and asks for it too, when needed. She defines her life by what good she can do.

She’s mostly money avoidance.

How to take advantage of your money scripts

We understand money scripts and how they can help us and hurt us. We have a sense of how we view money, given our upbringings. Now, let’s make your money scripts your secret weapon in pursuing financial freedom.

Fully understand your existing money scripts

This step is about reflection. So, find an hour one morning before the family wakes up. Or, lock yourself in your office without a phone or computer. Next, pull out a sheet of paper and do some journaling. Think back to your childhood and write out answers to these questions.

What emotion do you feel when you hear the word money?
What is your first memory related to money?
How did your parents treat money?
What financial flashpoints did you experience growing up? These are amazing or disastrous events related to money.
What kind of money quarrels do you have with your partner?

Now briefly scroll to the end of this post to see the complete list of 32 money scripts. Review each statement to see which you identify with. For each, write it down and reflect on it. From where does the belief stem? Compile a list of 5 or 10 scripts and keep them for later.

P.S. You can take the official money script quiz, but you’ll need to enter your name and email address.

To me, the money script score calculated by the quiz is not important. Instead, spend your time understanding why you have the money beliefs that you do.

Design your ideal money scripts

Next, we’ll look deeper into the money scripts you desire. The list will be different for everyone. Money avoidance, money worship, money status, and money vigilance have pros and cons. The ideal script is the visible and balanced script that’s aligned with your life goals (and those of your partner, if they will be sticking around…!).

You may like what you uncovered in the previous step. Or you may not. For some of you, with this newfound awareness comes the ability to change your money scripts. For others, it may not. Keep this in mind. In this step, we’ll design what money scripts you choose to live by. And we want the list to be realistic.

As you embark on this journey, consider:

Money itself is not good or evil. Money is a tool that you can use for good (or evil). It’s about how you use it.
Money isn’t everything. On their deathbeds, people don’t cherish their money. They treasure relationships and personal connections.
You can separate money from status. You can achieve status with professional skills or your ability to influence others.
Try to find balance. As with most things in life, taking a balanced approach keeps you grounded. Eat one cookie per day like my mother-in-law, and not a package of 12 like me (on bad days).
Align these efforts with your partner. Money issues can lead to divorce. I recommended including your partner as you design your perfect money script.

Return to the complete set of 32 money scripts. Identify which statements you want to identify with. These could be statements you wrote down earlier or new ones. Why are these best? How do they move you toward your purpose? Write down these 5 or 10 scripts and keep them for later.

Align your financial freedom plan with your money scripts

One bit of warning: This final step is never truly done. Revisit this activity as you make progress toward your financial and lifestyle goals.

First, assess where you are and where you want to be. Compare your lists of money scripts from the earlier two steps.

For those changes you want to make (and believe you can make), reflect once again. Take out that piece of paper and journal answers to these questions.

Why do you think these money script gaps exist?
Do I want to close the gaps and pursue my ideal money script?
For those I do, what support do I need?

Then get to work on closing the gaps. First, make your efforts known to those you love. You’re trying to improve your relationship with money, and those you love will want to help. It’s an earnest challenge. This support also makes you more accountable.

When you think through money issues (big and small), focus on breaking ingrained habits. With a mantra of “no autopilot!” ask questions about your money decisions. And assess them against your new, ideal money scripts.

Also, take steps to align your financial freedom plan with your money scripts. Do this in two parts.

Review your plan’s ultimate goals. We all want to live fulfilled lives. But fulfillment means something different to each of us. If your ideal is money avoidance, there are wonderful ways to live cheaply and help those with less. If you’re money-worshipping, you can maximize your wealth to help the most people.
Review your plan’s action steps. If you desire money status, your financial plan shouldn’t call for saving 50% of what you earn. If you seek money avoidance, don’t base your plan’s success on do-it-yourself, Vanguard mutual fund index investing. Assess every action in your plan and make sure it aligns with your ideal money scripts.

Money gives us security, time, and financial freedom. Isn’t it wonderful? But money also drives wasteful consumerism, breeds greed, and incites family fights. Money is a tool. To use it well, we have to go deeper to understand the invisible beliefs we hold. Then, we can talk about our beliefs, change them if we want to, and harness them to design the life we want.

For reference, the 32 KMSI-II money scripts

This is the complete Klontz Money Script Inventory (Ver. 2) or KMSI-II money scripts, sorted by super script.

Reference this list as you design your ideal scripts. Do you identify with these statements? Do you want to?

Money avoidance

Being rich means you no longer fit in with old friends and family
Good people should not care about money
I do not deserve a lot of money when others have less than me
I do not deserve money
It is hard to be rich and a good person
Money corrupts people
Most rich people do not deserve their money
People get rich by taking advantage of others
Rich people are greedy
The less money you have, the better life is

Money worship

It is hard to be poor and happy
Money buys freedom
Money is power
Money would solve all my problems
More money will make you happier
Things would get better if I had more money
You can never have enough money

Money status

I will not buy something unless it is new (e.g., car, house)
Money is what gives life meaning
Most poor people do not deserve to have money
People are only as successful as the amount of money they earn
Poor people are lazy
You can have love or money, but not both
Your self-worth equals your net worth

Money vigilance

I would be a nervous wreck if I did not have money saved for an emergency
It is extravagant to spend money on oneself
It is important to save for a rainy day
It is wrong to ask others how much money they have or make
Money should be saved, not spent
People should work for their money and not be given financial handouts
You should always look for the best deal before buying something, even if it takes more time
You should not tell others how much money you have or make

—

Brian Herriot writes and rewrites his money scripts (and his blog) from his home in Alameda, California, and cabin in Hazelhurst, Wisconsin. He also prepares financial freedom plans for consultants and other mid-career professionals in one-week sprints. Check out his take on a new and different kind of retirement at choosyconsultant.com.

4 Steps to Rewriting Your Money Scripts (and Your Money Success Story)