June 23, 2023
6 mins

Inherited Money Beliefs and Learning New Habits

Inherited money beliefs
Summary.This article explores the role of family in shaping our financial habits and beliefs, common inherited beliefs about money...

Money is deeply rooted in our upbringing. Our family’s financial history, circumstances, and values influence us. As technology and our financial systems evolve, we must recognize that inherited money beliefs may no longer serve us as they previously did.

This article unpacks the role of your family in financial socialization, common inherited beliefs about money, and how these beliefs affect personal finance in Canada. By understanding these beliefs, we can identify where our mindset may be holding us back and take steps to create a healthier relationship with money.

The role of family in financial socialization

Family financial socialization affects money beliefs

Our upbringing influences our attitudes towards spending, saving, and investing, impacting our financial well-being. Family plays a significant role in shaping our habits and beliefs.

Family influence on financial habits and beliefs

We inherit our financial beliefs from our parents, grandparents, and family culture. These inherited money mindsets are called “money scripts,” which are belief categories most often associated with problematic financial decision-making that creates chronic stress (Klontz et al., 2011). Though some inherited beliefs can be healthy, many others are harmful.

Family messages impact on spending, saving, and investing

If our parents were frugal and emphasized saving, we might adopt a similar mindset and prioritize building an emergency fund or investing for retirement. Conversely, if our family members focused on immediate gratification and spending, we might tend toward impulse purchasing and have difficulty saving.

Family financial socialization theory suggests that both intentional and unintentional messages from our family members shape our financial knowledge and behaviour (Deenanath et al., 2019). This includes lessons about management and the subtle cues we pick up from observing our family’s financial attitudes and practices.

Overcoming inherited money beliefs

Our family upbringing is not the only factor that shapes our money mindset. However, understanding our money scripts and financial attitudes can change negative inherited beliefs and develop healthier habits. The key is identifying the problems holding us back and committing to change.

Common inherited beliefs about money

Inherited financial beliefs often lead to negative consequences and limit our financial growth and success.


Some inherited beliefs may be helpful, while others can be limiting and detrimental. The following are some negative inherited beliefs that might be holding you back.

Money is the root of all evil

We have all heard this adage before. This belief can lead to guilt or shame around wealth and success, potentially preventing you from pursuing financial goals (Spann, 2018).

Credit cards and debt are bad

Excessive debt is harmful. However, responsible use of credit cards and debt can help build your credit, leading to other financial opportunities, such as owning a home or pursuing higher education (Cardone & Kane, 2016).

You must save every penny

We all know this is not true (and impossible). Saving is essential. However, excessive frugality limits your ability to enjoy life or invest in experiences or pursuits that enrich your life.

Investing is too risky for the average person

This is a dated belief. Canadians can take advantage of investment opportunities that grow their wealth with little advice.

Discussing money is taboo

Whether single or part of a family, chatting about your finances should be as natural as discussing your day at work. Sharing knowledge helps you avoid missed opportunities from others’ experiences.

How these beliefs affect personal finance

Inherited financial beliefs often lead to negative consequences and limit our financial growth and success. These limitations might be missed investment opportunities or the chance to build your credit history. Or you may not enjoy life as much as you could (while still saving). You must break the cycle and find a balance that works for you and is up to date.

Strategies to overcome inherited beliefs

Break the cycle with a financial planner

Here are some strategies to help you break the cycle and create a healthier relationship with money:

  • Own your inherited beliefs: Reflect on your upbringing and recognize that you are carrying inherited money beliefs (Swaim, 2019). This understanding will immediately improve your financial decisions and reduce stress.
  • Educate yourself: Readers are leaders! Immerse yourself in knowledge by reading books, attending workshops or webinars, or taking online courses on personal finance and money management. Challenge any harmful or dated beliefs.
  • Seek professional advice: If you have deeply ingrained financial beliefs, consider working with a financial advisor or therapist. Refrain from selling yourself short regarding the guidance and support needed to change these beliefs.
  • Openly communicate about money: Break the taboo. Discuss money in honest and engaging conversations. Learn from your family, friends, and others around you.
  • Set realistic financial goals: Establish clear and achievable financial goals. Then, develop a plan to reach them. Stay focused and motivated, and reward yourself along the way.

These strategies will help you break the cycle of negative or dated inherited financial beliefs. Remember that this is a marathon, not a sprint, rooted in personal growth that results in financial well-being.

Real-life examples of overcoming inherited money beliefs

Here are some real-life stories of people like you who have successfully overcome their inherited beliefs about money. Names have been changed for privacy purposes.

Jenna: Overcoming the fear of investing

Jenna grew up in a family that believed investing from too risky for the average person. The family missed many investment opportunities that could have helped grow their wealth. After educating herself and seeking professional advice, Jenna gained the confidence to start investing. Over time, she has grown a diversified investment portfolio that has provided returns, enabling her to help her parents in retirement.

Derek: Breaking the taboo around money conversations

Many families in the 80s and 90s avoided conversations about money. This lack of open communication led to a limited understanding of money management. Derek embraced this deficiency by initiating conversations with family and friends about money—often with the latter’s discomfort. Nevertheless, the approach improved Derek’s financial knowledge, resulting in improved financial well-being.

Marta: Balancing saving and the joys of life

Marta grew up in a family where every penny was saved. Every bit of food was eaten, clothing was worn down to the thread, and financial discipline was ingrained in every decision and activity. While this mindset helped Marta build a formable savings account, it also limited her ability to enjoy life. Marta started setting realistic financial goals and plans to achieve them. This balanced how she saved and realized her ambitions while allowing her to enjoy her life.


In closing, not all inherited money beliefs are harmful. Being frugal usually means substantial savings. Doing things “the way they have always been done” can often provide a certain amount of stability. However, recognizing and breaking truly negative beliefs is essential to achieving financial well-being, growing wealth, and achieving success.

Success starts with doing some small toward your goal every single day. So if you want to break old habits, especially those passed on to you (without you knowing), you must actively participate. Understand that the personal growth you will experience will affect all parts of your life (positively). Moreover, with this personal growth comes financial security and a bright future for you and your family.

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