Heart, Mind & Money: Using Emotional Intelligence with Money

By Vangile Makwakwa

How can you increase your savings, decrease your spending and grow your investments?

By changing your thinking and your emotional response to money!

Action is born from emotion - You think. You feel an emotion. You take action

''Heart, Mind & Money: Using Emotional Intelligence for Financial Success'' reveals secrets to help you master your mind and your emotions so you can master your financial behavior.

When you understand the relationship between emotion and action, you can easily change your behavior with money.

Heart, Mind & Money: Using Emotional Intelligence for Financial Success helps you:

1. Take control of your finances: mastering your emotions helps you master your financial behavior
2. Release financial stress: the book explores 25 different emotions and gives you the tools to master negative emotions
3. Reach your financial goals with ease: when you’re calm, you can easily access your creative faculties
4. Increase productivity: when you have zero emotional baggage holding you back from taking action, you’re more productive
5. Increase the amount of money flowing into your life: increased productivity increases your earnings

• Language: English
• Publisher: Vangile Makwakwa
• Release date: Oct 18, 2012
• ISBN: 9781301825073

Vangile Makwakwa

Vangile Makwakwa speaker and writer with expertise in financial/ money coaching. In the past 4 years she has focused on researching and understanding the link between emotions and financial behavior. She has recently published her book: Heart, Mind & Money: Using Emotional Intelligence with Money, which explores 25 different emotions, their evolutionary importance and their impact on behavior and financial behavior in particular. Vangile’s career began in the mining and energy industry as an analyst. She then pursued her MBA degree at the Simmons School of Management in Boston, MA. She has lived and worked on 3 different continents and has even has the honor of coaching a Catholic Bishop on the link between health, spirituality and emotions! She has also worked with Campaign for Girls, preparing young women for the journey of life ahead. When not working, Vangile likes to travel to countries near the ocean and performing at international poetry festivals.

Book preview

How to master your emotions and change your financial behaviour

Caroline Myss, bestselling author of Anatomy of the Spirit, asserts that each of us has a financial prostitute; we’re all capable of selling our minds, bodies and/or talents for financial gain.

Most people baulk at this idea, but if you’re in a job you hate and you’re only in it for the pay cheque then you’re selling your mind or talent for money. If you’re in a loveless marriage or a relationship for financial security then you have a price. If you’re an artist doing creative work you hate, you’re selling out your talent, and that pay cheque is your price.

What keeps this financial prostitute alive?

Our need to survive or just plain survival instinct.

Ten thousand years ago, we (the human species) needed food and shelter to survive, but now most of us need money to buy food and pay for shelter – we’ve replaced food with money. We’ve learned to live in fear of being without money because we’ve come to equate lack of money with lack of food, lack of clothes, lack of love and even lack of respect. It’s this fear that gives rise to a variety of negative emotions about money. And it’s these negative emotions that make us a slave to money by driving our financial decisions and behaviour.

Being a slave to your emotions about money makes you a slave to money. Most of us are scared of money, scared of being without money, or ashamed of not having money. These negative emotions rule us and keep us playing small, living in the realm of past failures where we entertain negative thoughts, beliefs and stories.

We trade our time and even compromise our values for money and call it wealth creation, wealth building or financial security. We convince ourselves that we need to first get money before we can pursue our dreams or become truly happy. We forget that every time we compromise ourselves for money, we’re essentially giving money power over us and making money our master.

The truth is we first need to follow our dreams and become happy in order to build true wealth. Real wealth is not just about money but about living well – emotional wellbeing, physical wellbeing, financial wellbeing, spiritual wellbeing and above all a state of joy.

What good is all the money in the world if your health is bad, you feel unloved or you’re always looking over your shoulder in fear of what others will say about you?

As the age-old saying goes: what good is it to profit the world and lose your soul?

Emotional intelligence with money is about mastering your emotions about money so that you can make financial decisions that are in line with your values and bring you serenity and joy.

Incidentally that’s the purpose of this book: to help you understand your emotions in order to master them so that you can master your finances and not just create material wealth, but wellbeing.

How do emotions impact financial behaviour?

Imagine this scenario: You want to save money but find yourself thinking about your credit card debt which makes you frustrated.

You give into your frustration and before you know it, you start having thoughts about being unemployed and being unable to pay the mortgage which makes you anxious, and leaves you depressed. The more depressed you get the less motivated you are to make money, instead you find yourself procrastinating, isolating yourself and spending money you don’t have to make yourself feel better. A month later you receive your bank statement and find yourself in overdraft; your finances are getting worse not better. What happened?

Now imagine a different scenario: you want to save more money but instead of focusing on your debt, you choose to focus on what you’ll do with the money once you have it, which makes you excited and happy.

The more you focus on what you’ll do with the money, the happier, more excited and motivated you get. Not only that, but you find yourself motivated enough to network with people and talk to them about your ideas, which leads to new business opportunities. Your excitement leads you to talk to your bank manager or financial coach to help you achieve the things you want. Before you know it you’re earning more money and taking constructive financial action.

Why are you getting two different outcomes from the same intention to create wealth in both scenarios?

The answer lies in your emotions and your thoughts. Emotions are the link between your thoughts and your behaviour: you think a thought, you feel an emotion and then you take an action.

The emotion you feel at any present moment is an indicator of whether you’re thinking a good or bad thought and will let you know, very fast, if you’re about to take an action that will make you proud or rue the day you were born.

Being emotionally aware helps us understand our erroneous thoughts and beliefs about money, which helps us understand the actions we need to take in order to change our finances.

Law of attraction teachers and practitioners will explain that what you focus on persists. Thinking about debt creates more debt and thinking about wealth creates wealth.

But the answer isn’t just mystical or spiritual; it’s also very logical. Different thoughts trigger different emotions, and different emotions cause us to behave in different ways. Thinking about your debt and focusing on how much you owe makes you feel bad (anxious, guilty or even scared), which negatively impacts your behaviour. Thinking about being wealthy and living the life of your dreams makes you feel good (happy and excited), which positively impacts your behaviour.

You don’t spend, save, invest or even make the same amount of money when you’re depressed as you do when you’re content or joyous.

When we’re frustrated about the money we have, we make different investment decisions and may be more risk averse than when we’re feeling hopeful about money. These emotions that we feel in the present are affecting our financial future and have the power to keep us trapped in a financial cycle.

How could applying emotional intelligence (EQ) to your money, help you make wiser financial decisions?

Many teachings in economics, psychology and spirituality talk about the importance of mastering your emotions in order to master your behaviour.

Mastering our emotions and being emotionally aware helps us make wiser financial decisions, which leads to financial freedom.

Understanding your emotions and how they drive your financial behaviour is important and is the first step to changing your relationship with money.

When you know how different emotions affect you, you can teach yourself to observe them before taking any action and reacting to them. This will ensure that you take financial action only when you’re calm and objective, which will lead to favourable financial outcomes.

How Emotions Affect Our Behaviour

Emotions are triggered by a situation, event, object or person. These emotions then affect our behavioural patterns and our assessment of a situation, person or object.

According to psychologists, emotions are physiological states of arousal (related to a person, situation or object) that help us survive. Psychologists argue that emotions are connected to our beliefs, cultural backgrounds and drives, and have the power to influence our behaviour.

Evolutionary psychologists, on the other hand, believe that emotions are a sub-program of the brain that evolved to help us solve adaptive problems as we continued to evolve. Specific situations trigger specific emotions, which in turn trigger physiological and behavioural reactions to ensure our continued survival as a species (Cosmides & Tooby, 2000).

Ten thousand years ago our emotions helped us survive by securing food, the number-one resource we needed to be able to survive then. Today money is that resource that we need to survive and we use the same emotions to procure and secure it.

The psychology of emotions

Psychologists discriminate between primary and secondary emotions. Secondary emotions mask primary emotions (love, joy, anger, surprise, sadness and fear) which are felt right after an event.

Psychological theories on emotions tend to differ on the order in which emotions and behaviour occur during or following an event. Most psychological theories agree that there’s a link between mind, body/behaviour and emotion but they don’t agree on how we get to feel the emotions we feel. Do we think a thought and then feel an emotion and respond physiologically? Or, do we have a physiological/behavioural response, think a thought and then feel an emotion?

According to the Cannon-Bard theory of emotion we experience an event, feel an emotion and then have a physical response. Example: your wish comes true; you feel happy and behave in a happy manner by laughing or smiling.

According to the James-Lange theory of emotion we’re a mass of stimulus response and we respond automatically to events as they happen based on past reactions that are encoded in our DNA or that we’ve taught ourselves. This theory states that we first experience an event, have a physiological response, interpret the response and then have an emotional reaction. Example: your wish comes true, you respond by laughing and smiling, interpret laughing and smiling as happiness and then only do you feel happiness.

The Lazarus theory of emotion, on the other hand, states that every emotion stems from a thought, which gives rise to an emotion, which then affects behaviour and other physiological responses. According to this theory we experience an event, think and philosophise about it (decide if it’s good or bad), feel the appropriate emotion (if it’s good we feel a good emotion and if it’s bad we feel a bad emotion) and then behave accordingly. Example: your wish comes true, you think this is good since it’s what you wanted for a long time, you feel happy and then you laugh and smile.

These are just three theories of emotions but there are many more theories and each of them is valid. It’s like the chicken or the egg question: do we first feel and then react or do we react and then feel?

I tend to favour the Lazarus theory of emotion and use it to work backwards to understand the underlying thought that is causing an emotion. Once I understand the negative thought I get the client to question its validity and change it. Changing a thought changes the emotion and the behaviour that the underlying thought is causing.

For the most part, the brain is still a mystery to us, which also makes the way we experience emotion a mystery.

What’s clear for the moment, anyway, is that there is a link between thought, emotions and behaviour.

(To learn more about the theory of emotions got to: http://alleydog.com/topics/emotion.php)

Emotions from a Buddhist Perspective

Buddhists believe that emotions are what we give to a physical state that we find to be pleasant or unpleasant (De Silva, 1976).

Our emotions are physically felt in our bodies. Whenever we feel a good sensation we label it as pleasant and when we feel an unpleasant sensation we label it as such.

Our idea of what constitutes a pleasant or unpleasant sensation is based on our past experiences, which drive our behaviour in the present and eventually become part of our personality (De Silva, 1976).

This theory goes even further to state that we actively seek out people, things and situations that arouse pleasant sensations and avoid anything that brings up any kind of unpleasant sensation within us.

In fact we become attached to anything that gives us pleasure and will even engage in destructive behaviour to experience this pleasure.

An example of this is drinking alcohol to feel happy or procrastinating to avoid work. We happily do this because we consider being drunk a pleasant sensation and work an unpleasant sensation. This suggests that all behaviours we engage in have an emotional payoff: pleasure.

One of the things I have started to understand from practicing Vipassna Buddhism (www.dhamma.org) is that all objects arouse an unpleasant or pleasant physical sensation in us. The subconscious mind is constantly reacting to these objects; when an object makes us feel a pleasant sensation (emotionally and physically) we love it and seek more of it but when it makes us feel bad physically and emotionally we avoid it. Our whole lives then boil down to the quest for pleasure and the aversion of pain, which leads to misery because we’re constantly reacting to people, events and situations. When good things happen in our lives, we feel on top of the world and when bad things happen we feel very depressed. We stop being the masters of