What does "I'm bad with money" mean to you?

[Nika]

I see that statement a lot, and I wonder what people actually mean by this?

Is it "I just want to do what I want?" I don't know, but it sounds like a cop-out.

But is it really about money, or about something else?

For example, people who know (or should know) they will need new tires that year, yet they will blow their tax refund on a vacation and than be completely "surprised" and stressed out by an expense that is not unpredictable in any way. Is it really about being bad with money, or about being bad with something else?

[Jluke]

managing money/budgeting takes effort...

it's easier to manage when you have no money.

[snafu]

Attempted to connect lack of personal discipline to 'bad with money' theme

[Nika]

Interesting question Nika... if I can look at other aspects of their life, I notice while they look 'put together' on the surface, it's barely skin deep. The over riding issue seems to be a lack of discipline. As a colleague, a deadline is merely for others, even though it puts the rest of our team in near crisis. The most often retort is 'it's here, somewhere...'

They never offer to drive as their car is over due for oil change, and a major clean out. The rooms of their home feel chaotic but merely in need of items put back where they belong. Heap of wet towels on the bthrm floor, make-up strewn over vanity, three rejected outfits tossed on a chair and the bed unmade.

If they paid bills by the due date, [incredibly easy electronically] they wouldn't have to pay all those late fees which makes 'bad with money' theme worse. When my husband worked in HR he grumbled and roared seeing them as ego centred and merely self indulgent like the people who stop and have a conversation at the bottom of the escalator.

I don't think there is a connection between being organized or neat or good with money. My mom is obsessed with keeping her apartment clean, yet is crazy determined to never face or examine her financial prospects or reality.

I don't make bed and can let laundry pile up (we both work full time and have other responsibilities, making bed is just not a priority - I need to feed my child a nutritious breakfast, dress him, get him ready, call a taxi and drop him off at the camp, and be on a train to work before 8 am. Sorry, that bed is not worth even 1 minute being deducted from a meager amount of sleep we get), yet I'm very organized on financial issues.

In fact, the lack of connection between being "organized" or neat and any kind of financial strategic planning is very curious.

[sv2007]

Then they'll stay poor forever.

Not everybody is cut out to be an Olympician and not everybody is cut out to be money smart. But at least there are many professionals who can help most people in the latter.

[cypher1]

Spend first, think later, save last or never.

[GoodSteward]

I don't think there is a connection between being organized or neat or good with money. My mom is obsessed with keeping her apartment clean, yet is crazy determined to never face or examine her financial prospects or reality.

I don't make bed and can let laundry pile up (we both work full time and have other responsibilities, making bed is just not a priority - I need to feed my child a nutritious breakfast, dress him, get him ready, call a taxi and drop him off at the camp, and be on a train to work before 8 am. Sorry, that bed is not worth even 1 minute being deducted from a meager amount of sleep we get), yet I'm very organized on financial issues.

In fact, the lack of connection between being "organized" or neat and any kind of financial strategic planning is very curious.

I agree completely. I know many people who keep a well-cleaned house, my mom included, yet have horrid finances. My mom is notorious for making sure every dish is washed before bed. Yet she has no budget and was proud to share that she had 17,000$ that she never even put money into(private dr office was putting some in for her over the years). Now, the company investor just did a dumb-dumb and lost 5,000$ of it. That's all the retirement she has

I used to think bad with money meant people who don't pay their bills on time. As long as you paid what you owed each month, you were "good with money." After going through several hard life lessons, I have come to realize paying bills on time means nearly nothing about how well you manage finances. I was paying all my bills on time but had no cash flow left after payments, no savings, and no retirement. I was NOT good with money. I was just good with payments.

[clatoden99]

SIMPLE: you lack money management skills.
GOLDEN RULE: Accumulate more, Spend less, Save more!!!!

[~bs]

People that say that usually are living paycheck to paycheck with little savings, and potentially a lot of debt. For someone to admit that means their financial situation is probably pretty damn bad. They recognize they have a problem, but refuse to do anything about it.

[Singuy]

I would say someone who is "bad with money" has the following attributes(could be all or anyone of these)

1. Not interested in numbers/math.
2. Doesn't like to limit themselves
3. Not a planner but the yolo type
4. Doesn't understand compounding interest
5. Have very little respect for money

I have found #1 resonates with a lot of females student of mine...#3 and #5 could be a cultural thing...and #4 seems to be almost everyone I teach.

In fact I am going over the concept of why your monthly payment is the same toward your student loan if it's on a 10 year repayment plan despite signing up for 10 year forgiveness. The co-worker just doesn't get it..and was expecting her monthly payment to go down...she is still lost after me explaining twice why her payment doesn't change. It truly was a "how long will it take you to travel 80 miles if you are going 80 miles/hr" moment.


People are shocked at the power of compounding interest when explained..to the point that they almost see it as a myth. How is that I end up paying 600k on a house I bought for 250k? How will saving 25 dollars a week get me a million dollars in 45 years? Just watch their mind blow.

[GoodSteward]

I would say someone who is "bad with money" has the following attributes(could be all or anyone of these)

1. Not interested in numbers/math.
2. Doesn't like to limit themselves
3. Not a planner but the yolo type
4. Doesn't understand compounding interest
5. Have very little respect for money

I have found #1 resonates with a lot of females student of mine...#3 and #5 could be a cultural thing...and #4 seems to be almost everyone I teach.

In fact I am going over the concept of why your monthly payment is the same toward your student loan if it's on a 10 year repayment plan despite signing up for 10 year forgiveness. The co-worker just doesn't get it..and was expecting her monthly payment to go down...she is still lost after me explaining twice why her payment doesn't change. It truly was a "how long will it take you to travel 80 miles if you are going 80 miles/hr" moment.


People are shocked at the power of compounding interest when explained..to the point that they almost see it as a myth. How is that I end up paying 600k on a house I bought for 250k? How will saving 25 dollars a week get me a million dollars in 45 years? Just watch their mind blow.

[bjl584]

Let's see:

1) Not interested in saving, investing, or math in general
2) Wants instant gratification. No patience or ability to save and wait for anything.
3) Living for today and not thinking about the future.
4) A sense of entitlement.
5) Using debt and credit as "free" money
6) Thinking in terms of monthly payments and not overall total cost

That's a few that come to mind.

[GoodSteward]

Let's see:

1) Not interested in saving, investing, or math in general
2) Wants instant gratification. No patience or ability to save and wait for anything.
3) Living for today and not thinking about the future.
4) A sense of entitlement.
5) Using debt and credit as "free" money
6) Thinking in terms of monthly payments and not overall total cost

That's a few that come to mind.

I think you could combine this list with Singuys, and have a pretty good overall picture of the mind of someone in this situation. I can relate to thinking a lot of this myself when I was "bad with money"

[Nika]

Now that I thought about it more, I think it is not about organization at all.

1) It is about strategic planning, which is not the same as neatness.

You think about what your goals are, and how can you possibly get there.
Family, just like a company, needs to look out for its goals and targets and have an overview of their plans and associated expenditures for the next month, quarter, year, and long term.

It is not about accumulation, it is about planning. Money is there to support your goals, that's its primary purpose.

Time with family, safety net, education that gives advantage to kids and improves their future... these are very money related goals, but money is means, not an end. So if these things matter to someone, funding them should be a priority.

But some people seem to have a natural inclination to project, and some don't. For example, in the summer my son goes to a very high quality camp, which unfortunately costs 200$ per day. So this number must be included in our childcare cost averages or our budget would be very divorced from reality. And thus we think about cost of next summer now, when we finished paying for this summer. But many people manage to be in denial and than scramble come May. Even though they know when they will need that childcare, and even know what their options in their area are!

2) Unconsciously filling the gaps in knowledge.

For example, I recently found out that my mom has no basic understanding of how the banking system works, how mortgage works, etc. But the thing is SHE HAS NO IDEA that she does not understand it. She filled out the blanks in her knowledge from her imagination, and than just believed that these things are true. So people who don't know, often are not even aware that they don't know, and therefore, even though they could learn by asking a very simple question, never will, because they are not aware they are missing any information. This one is pretty hard to overcome.

3) Assuming something is impossible for their situation and giving up without exploring it further.

Often those things that seem impossible are just impossible without long term planning. For example, our family needs 2 incomes. So staying home with our second baby for a year or two would seem impossible. But also the logistics of juggling logistics of our son's school, daycare for a new baby in a different location, and a baby that wakes every 2-3 hours to feed, and so on, seemed impossible or at least would be so overwhelming that the pressure exerted on our family would be more than we feel we could handle without major impact on health and well being.

So we planned for few years on how to make this happen. Yes, the deficit without my income would be large, but with side jobs and savings, and maximum saved leave days and so on... we managed to come up with reasonable plan. It just took time. But rarely does anyone think about how to fund their baby 3-4 years before conceiving it. On baby forums, women who are 5-6 month pregnant are starting to research childcare options and panic. But I don't know how you can not think of it in advance, as it is an inevitable reality.

[frugal saver]

I think some people just don't want to know about something, because they just don't care.

If it's (like me) football--well, there's no rule I have to know anything about football and Super Bowl Sunday is a great day to shop without a lot of salesmen bugging you. So it works.

But when it comes to finances and investing, it can seriously hurt you if you don't either force yourself to learn the basics or take the time to find someone you trust.

My mother's idea of finances was writing down the check information in the check register. And that was it. She'd inherited a largish sum of money and thought it would be fine just to let it sit in her no-interest checking account. She was finally convinced by my step-father and his financial advisor to put it in an annuity. (Not my first choice, but at least it was something.)

Until the end of her life, she referred to the inheritance as "the money they stole from me." I used to show her the statements when I stopped by to balance her checkbook--there's the money, there's the interest it earned. She'd shrug and comment that "I hope whoever stole it enjoys the interest."

I think anyone can get better at something they're "bad with." But they have to want to.