Introduction
Have you ever walked out of a store with something you didn’t plan to buy or made an impulse purchase online, and then felt a twinge of regret? Or perhaps you held off on saving even though you knew you should. You’re not alone. Studies show that our emotions don’t just influence money decisions they often drive them. Nasdaq+2Empower+2
If you’ve ever felt like you’re fighting your own habits when it comes to money paying more, saving less, or simply avoiding the topic altogether then this post is for you. I’ll help you understand why you feel the way you do around money, how your background and location matter, and what practical steps you can take to get your emotions working for you rather than against you.
Understanding the Basics: Money Psychology 101
What is the psychology of money?
Money decisions aren’t made in a vacuum. From the field of Behavioral finance we learn that psychological biases and emotional drivers shape how we spend, save, invest or avoid doing those things. Investopedia+1
In simple terms: even when you intend to act rationally, your brain, your feelings, your past experiences and your environment are all chipping in.
Why geography and culture matter
Your saving/spending pattern isn’t only “you.” It’s also where you live, your economic environment, your culture and your banking access. For example, someone in a stable economy with strong savings infrastructure may behave differently from someone in a more variable income or informal-economy setting. These differences affect how emotions interact with money in real life.
Key Insights: What You Need to Know
Emotions that derail or drive your money habits
- Fear & anxiety: When you’re worried about money, you may avoid checking your account, delay saving, or make impulsive purchases to “feel better” temporarily. Empower+1
- Excitement or confidence: Feeling good about money can lead to overspending or risk-taking sometimes at the wrong time. Vanguard
- Guilt or shame: These emotions can lead to hiding from your finances instead of dealing with them. They also influence how you talk to yourself and act. Nasdaq
- Comparison & social influence: What you see others doing especially via social media drives spending impulses even when it doesn’t align with your goals.
Emotion + bias = financial friction
Emotional drivers combine with cognitive biases to create patterns. For example:
- Loss aversion: We feel losses more deeply than equivalent gains, which can lead to hoarding money instead of investing it. Nasdaq+1
- Anchoring: We base decisions on first impressions or fixed numbers (“I always spend this much”) even when they’re irrelevant. Investopedia
- Mental accounting: We mentally separate money into buckets (“budget for fun,” “emergency fund”) which can skew rational saving/spending behaviour. Wikipedia
These biases are universal but how they play out depends on regional norms, income variability and culture.
How geography changes the relationship between emotion and money
If you live in a place where incomes are unpredictable, where banking access is limited, or where saving culture is weaker, the emotional triggers around money might be stronger (or different). For instance:
- A fallback expense may feel more urgent, which triggers fear and reactive spending.
- A sudden bonus may feel like “free money,” and you might spend quickly rather than save it.
- Cultural norms (“one should enjoy life now” vs “one should save for later”) shape how you feel when you either spend or save.
Recognizing the local context makes your emotional-money work far more effective.
Real-life story: Maria in Bogotá
Maria works freelance in Bogotá. Some months she earns a lot, others very little. She realized she felt anxious at the end of each month and would sometimes spend impulsively when she got paid “because I deserve it,” she thought.
She decided: each time she got paid, she would transfer a fixed small amount into savings first, before anything else. She also kept a “treat” budget that allowed a small splurge without guilt.
Within a year she had built a cushion, and the anxiety at month-end dropped significantly. Her emotional driver (anxiety) became a motivator for a practical habit (automated saving).
This change worked because she tied the habit to how she felt, not just what she should do.
Actionable Steps: What You Can Do Right Now
- Track how you feel around money
- Keep a simple “money + mood” diary for a week: note a spending or saving moment, and jot how you felt.
- Ask: Did I feel anxious? Empowered? Guilty? Energized?
- Reflect: Which emotions show up most often around money?
- Map your emotional spending triggers
- Example triggers: payday, social media browse, a stressful day at work, payday treat.
- For each trigger, list an alternative action (e.g., instead of buying an item after a tough day, go for a walk + review budget).
- Create “emotion-proof” money rules
- Automate savings: On payday, move X % to savings before seeing the balance.
- Use “cool-off” rules: If you feel like spending because you’re sad/upset, wait 24 hours before the purchase.
- Set pre-commitments: Eg: if I get paid, I’ll save twice what I’d normally “treat” myself with.
- Use local context to your advantage
- If your income is irregular: Use flexible saving rules (save when you can, not fixed amounts).
- If the saving culture is weak around you: surround yourself with one or two peers who also save and talk about money.
- If banking access is limited: Try mobile savings tools or wallets make the habit work for your reality.
- Build emotional resilience around money
- Recognize that feelings are valid but they don’t have to decide your actions.
- Accept that you’ll make emotional decisions sometimes and plan for them (budget a fun fund).
- Review periodically (quarterly) how your habits tie into your feelings. Adjust rules accordingly.
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Conclusion
Here are your key takeaways:
- Your emotions shape your spending and saving as much as logic does fear, joy, guilt and pride all play a role.
- Understanding your local and personal context income pattern, culture, access lets you tailor emotional-money habits that work for you.
- You can create practical, emotion-aware rules (automate, cool-off, pre-commit) to turn emotional impulses into positive financial actions.
- This matters because when you bring your feelings to the table (rather than ignoring them) you stop fighting yourself and start using your emotional system as an ally in your financial life.
If you found this valuable, please comment below: What emotion tends to drive your spending? Share and you’ll not only help yourself reflect you’ll help someone else too. And if you haven’t already subscribe for more tools to help your money mindset shift into gear.