Photograph by Terry Travasso

The world as we know it as adults is often viewed through the prism of our childhood experiences and memories, which may also reflect in the relationship you currently have with your money. Money is a complicated but fascinating object in our everyday lives. Our first brush of informal knowledge about it is through interactions with parents and peers, especially during early childhood (from birth to eight years of age), which is a period of tremendous cognitive growth. This is when you begin to gradually identify other people’s emotions and also gain a basic understanding of financial transactions

Canada-based therapist Omar Bazza, who often speaks about mental health issues on Twitter (@bazzapower), recently wrote a thread on how childhood memories mould our future: “The memories that we have serve a purpose. None of our memories occur by accident. The save button of our brain is emotion. The stronger the emotion, the more likely the memory is to be strong and vivid. All our memories have emotions attached to them.”

If you can recall how your parents spoke about money when you were a child — whether arguments over money being tight or lectures on the importance of saving for a rainy day — you might find that these incidents inform the emotions you feel while making monetary decisions now. If things were hard at home and your needs were never met, you might mull hard over every purchase and may have some amount of financial anxiety as a grown-up. And even if your circumstances have changed now, you may still find it difficult to justify extravagant purchases — or experience buyer’s remorse if you do make that purchase. On the other hand, if you were brought up in an environment where living beyond your means was habitual, you may be inclined to satiate your needs instantly, even if it breaks the bank.

Of course, our childhood memories are not the only factor that defines our relationship with money — and they don’t eliminate the possibility of changing our financial behaviour either. For instance, Indians are often considered to be risk-averse investors and would rather make decisions that protect their money than focus on generating returns. Among the Indian middle class in particular, this mindset could be a result of living through the 1990s and late 2000s, decades that are widely remembered for a series of financial scams. But that doesn’t necessarily reflect the way the generation that grew up during this period manages their money. A recent NSE survey discovered that the current generation of young Indian investors — aged between 21 and 45 years old — have a more robust appetite for risk compared to previous generations. 

Our understanding of finance evolves as we grow older and explore new ways of experiencing this realm with an expanded consciousness that is informed by several determinants beyond the memories of our childhood. In the process, we may find wisdom and comfort in convention or unlearn what is potentially maladaptive in the interest of safeguarding a stable financial future.

Discover your MoneySign®

Identify the personality traits and behavioural patterns that shape your financial choices.