Are you feeling like you are not in control of your life?
Like your money is controlling your life instead of the other way around?
If so, you might need a finance therapist.
This unbiased blog post talks about what it means to be a finance therapist because there are several types of finance therapists, and how they can help with financial problems that seem out of control. They will teach you how to get back on track financially while also helping with emotional issues that have been holding you back from making smart decisions.
There are a few types of finance therapists. Note that not everyone with the label “finance therapist” is an actual therapist.
Not every certificate in finance therapy or membership in a finance therapy community (professional or amateur) denotes a background in psychotherapy.
Not every finance therapist is licensed, and of those that are, not all licensing is in psychotherapy.
Let me explain.
The term, “Finance therapy” is an unregulated term. Anyone can call themselves a financial therapist.
There are licensed psychotherapists, financial professionals, and coaches.
The term seems trendy but social workers and psychologists have been providing finance therapy for many years; as many people struggle with money and money is the number two cause of divorce.
- These are licensed psychotherapists from differing modalities within psychology that specialize in finance therapy or use it as one of their focus areas, in their private practice.
- These types of therapists do not ask for details about your finances
- A licensed psychotherapist is not allowed to sell you ongoing financial services or products as it is a conflict of interest. For instance, they would not be a both your licensed psychotherapist and, your insurance agents or your Certified Financial Planner. This would be a conflict of interest and, unethical on the side of psychotherapy.
- A licensed psychotherapist may not have any dual role with any one client or patient, such as also serving as their financial advisor or wealth management, as examples.
- There are financial planners and other finance professionals who sell financial products that use aspects of finance therapy. They may learn about financial education and how to manage some emotions surrounding money, but they are not legally permitted to provide actual therapeutic services while conducting business as a finance professional, even if they hold a psychotherapy license.
- If the role of a financial planner or wealth manager, insurance agent, etc., is that financial role, it might be seen as exploiting the client if they have, for instance, information that the client is anxious and has impulse control issues and then knowing this, sells them products or services. However, there is not a governing agency that is both a financial and psychotherapeutic agency. The financial professional must disclose that even with a certification in finance therapy, that they are
- Not licensed and unqualified to work with emotional trauma beyond coaching or
- Licensed and working in one role or the other, not both.
- Coaches. Coaches who do not have therapeutic licensure and are not finance professionals also can provide finance therapy and often have a niche’ within coaching, such as getting out of debt for single moms, etc.
- A psychotherapist and a financial professional may both wear the hat of “coach” at times. Coaching is also not regulated by a governing agency and is specific to help educate, motivate and support a client in their goals.
To give two quick examples, a Certified Financial Planner might be a “finance therapist” by certification but acting in the role of a coach. Or, a Certified Financial Planner might be a finance therapist because they are also a licensed psychotherapist, but they must define which role they are working with you, as it can’t be both. It becomes confusing.
Many licensed psychotherapists who focus on finance therapy have some type of certification or ongoing education in finance and, most financial professionals who are interested in helping clients manage stress read up on self-help or get certifications in finance therapy. The line is blurry only until you look at regulating agencies and who and who is not regulated by what agency.
Make no mistake, all three have benefits, but because the term “therapist” implies psychotherapy, this will focus on the unique differences within the specialty of financial therapy even within psychotherapists.
A psychotherapeutic financial therapist
A licensed financial therapist is implied that are licensed in some form of psychotherapy and are able to help support clients or patients in other areas of trauma or stress as well. They are a type of therapist that specializes in providing psychotherapy to those who are struggling with money management as well as all conflicts surrounding money in general.
They may also work with anxiety, trauma, depression, and other struggles that one might see a therapist for.
Many times wealthy couples or wealthy business partners are at odds because of how money is being distributed, spent, saved, or invested. Sometimes there is no outward struggle but like many types of stresses that we encounter, the struggle is inward and hidden from the world. There are people who actually are stressed once they’ve “made it” and feel more comfortable with debt; I know, it seems odd but it all goes back to the money story. It isn’t just about people who need to get out of debt, but that is addressed as well.
What types of psychotherapeutic finance therapists are there?
There’s a diverse group.
This type of therapist is going to look at the broader picture; they might also work on your anxiety, self-value, interpersonal relationships, and more. These therapists might have other niches such as couples therapy, trauma recovery, addictions, or anxiety reduction. Some are more focused on business and marketing or writing. There might be a blend of education and coaching inclusive of psychotherapy or, separated.
Millennial money is a popular topic. There are some millennial therapists who specialize in millennials and money. The benefit of a millennial finance therapist for millennials is that they understand each other on a more peer-to-peer landscape and grew up in a similar timeframe. Some older clients and patients might have a harder time connecting with a younger therapist who obviously hasn’t put children through college yet, etc. but they should not be discounted because they are skilled, trained, and passionate about their specialization.
There are also licensed psychotherapists who are finance therapists who teach, who are focused on teaching at a university level.
There are also some finance therapists who focus on writing and teaching the community. This is a crossover as there are many specialties that might be interesting in authorship.
While there are more specialties not mentioned, hopefully, this has given you an overview and a starting ground to explore seeking out the best financial therapist for your situation.
What does a Finance Therapist Do?
While a coach might help you budget and motivate you to save, the finance therapist also helps people with their money problems. They provide a safe space for you to talk about your financial issues and the people in your life who might have or currently do, contribute to the financial problems and get tips on how to fix them without any judgment. This type of therapy can be life-changing, but it also takes time and commitment from the person seeking help.
If you or someone you know is struggling with financial stress, there are many ways to get help. One option that’s gaining more and more traction these days is a finance therapist. Some finance therapists work on the premise of cognitive-behavioral therapy (CBT) which helps people identify where their money issues stem from and then takes steps to correct those behaviors so they can live happier lives without as much worry about finances. Also, hypnotherapy is a way that therapists can help you alter your mindset and meet your goals.
A finance therapist helps you to find new ways to view your problems and yourself. It’s not just about finding your inner self-worth but also making sure you have enough money to sustain and thrive.
Happiness can’t buy everything but poverty certainly can stop you from living life to its fullest.
This is beneficial because a finance therapist will show you how important it is to pay attention to your finances —as well as your mental health.