Do you ever consider your financial decisions from the past and wonder, “How did I allow myself to be so stupid?” The shame you feel can be even worse than the money you lost. In times of financial difficulty, remember that you are never truly foolish for limiting yourself to a budget and being careful about how you spend your money.

Breaking this shame cycle and restoring your relationship with money will enable you to overcome your disappointment and chart a course forward. Here’s how you can do it.

What is the cycle of shame?

Before you can change the cycle of shame, you must first know what it feels like to be shamed.

Shame can be described as “an intense, shameful feeling of being fundamentally flawed.” It can take the form of anxiety, fury, secrecy, and, in extreme cases, even suicide if you do not believe you have a way out.

For example, a person who suffers from money shame may be embarrassed about how much debt they have. They can’t stand how helpless they feel when they see their credit card statements, so they go on a shopping spree in an attempt to feel better.

The next day, they are embarrassed at how much they have spent, so they buy additional items in an attempt to blot out the pain. It’s a downward spiral.

Guilt vs. shame: There’s a big difference

Don’t confuse guilt with shame when it comes to money because they’re two completely different things.

The result of guilt makes you think you made a mistake (e.g., “I made a bad decision with my money.”). Shame makes you think you are the ones making a mistake (e.g., “I’m terrible with money.”).

Learning from your mistakes encourages you to perform better.

How the cycle of shame harms your relationship with money

Money shame is a problem in the United States. No one is born knowing how to manage their money, but we are all expected to do so correctly from the beginning. If we ever show signs of difficulty, we beat ourselves up over it. We internalize the shame and convince ourselves that we will never be financially successful.

If you’re not careful, this cycle of shame can lead to a downward spiral where you:

If you or someone you know has been contemplating suicide because of financial troubles, call the National Suicide Prevention Hotline at 800-273-8255. Suicidal thoughts are preventable, and there is a way out. Financial strain can be temporary and you can have the life you want!

5 Tips for breaking the shame cycle around money

Even if you have a terrible financial situation, you can break free from the cycle in which you feel ashamed for money.

1. Figure out why you’re experiencing money shame

The goal is to get to the bottom of the problem. Dig into your past and identify where your money shame is coming from.

Once you’ve figured out the reason for your money setback, write it down on paper so that you can remember it and can begin the healing process.

For example, you may write, “No one taught me about credit cards when I was young. When offers started flooding through the mail during college, I blindly racked up charges without fully understanding the interest behind it. I’ve been shaming myself for having so much credit card debt, but now I’m making a plan to move forward.”

You can rewrite your news story for spare money!

2. Open up to your loved ones about your money situation

You probably have been keeping the source of your financial shame a secret for many years. You may also have bottled up the resentment you feel, being too reluctant to let anyone in.

To break the shame cycle, it is important to open up to someone you trust. The person should not judge you for your situation, and must understand it as you are. Tell your story to this person, and discuss your difficulties openly.

Break The Cycle Of Shame Around Money
Break The Cycle Of Shame Around Money

Even a loved family member can assist you back into good habits if you have fallen into them. For instance, a relative may be able to give you advice on how to lower your interest rate or reduce your debt more quickly.

3. Replace your negative thoughts and habits with positive ones

Money shame is often accompanied by negative behaviors that are hard to break free from. That’s why it’s important to create positive habits that counteract the damaging ones.

As an example, if you feel you are bad with money, make a list of mantras you can repeat to help you stay mindful of how marvelous you are.

Then, it only takes a few small actions to support these positive beliefs. Set up $20 in your savings account every time you get paid. Pay an additional $50 to your credit card bill. Read one personal finance book per month. These little actions will compound and melt your humiliation into pride.

4. Get professional help breaking the cycle of shame with money

If you already have done some of these tips but still can’t break the shame cycle, consider hiring a financial therapist or financial coach. These counselors can pinpoint the source of your financial shame, help you get more in touch with the way you handle your finances, and devise a plan for moving forward.

5. Practice self-love and compassion regularly

Do you have what it takes to break the chain of shame? Practice self-love and never stop fighting the harmful inner monologue that makes you feel unworthy. Studies show that self-confidence is an important indicator of success. If you believe you have what it takes to reach your aims, you’re much more likely to succeed. In times of hardship, you are much more determined to overcome obstacles.

Break the cycle of shame by starting with one small action

What one small step can you take today to break free from the cycle of shame surrounding finances? It doesn’t necessarily have to be anything extravagant.

Pick one task you can do this week that will save money. You have this.


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