As children we had things in our lives that scare us, things that make us happy, different smells that bring up emotions in us, different people in our lives, and different experiences.

What we don’t understand is those things go with us to our adulthood and one of the most prominent is money. Think about it: What was your relationship with money when you were a child?

I know what mine was.

When we were kids we were not allowed to talk about money, we were very poor and my dad came in and out of our lives. When my mother and father did speak about money they were usually screaming at each other, they either screamed at each other or nobody spoke. So, in our household the subject of money was very tense, very scary. I didn’t understand how money worked when I was 4 or 5 years old. Yet I knew we didn’t have any and I knew that having money made things better and not having money made things worse.

So, as I got older and I started babysitting, I would hide my money away. There would be things that I could have bought with it yet I chose not to because I was afraid to lose $5. Back then when you babysat you made 50 cents an hour if you were lucky.

So, I started feeling very anxious about my money and sticking it in my underwear drawer or my sock drawer. It wasn’t until I got into high school that I started putting it in a little savings account because my mother worked at a bank. So, when I was in high school I started really understanding how it much cost for my mom to have me in her life… my uniforms, my books, anything we needed, food, gasoline, groceries. We knew when we were low on money because we had waffles or pancakes and scrambled eggs for dinner because we didn’t have money for meat or vegetables.

So, I started to develop this relationship of anxiety with money and if you look back to your childhood, you can see that the relationship you have with money now is a relationship that started a long time ago…

It’s very important to look at that relationship now when you have money. Are you anxious? Are you having struggles with buying something you want and feeling guilt from it?

Our relationship with money from our childhood is one of the most important things you’re going to learn when we start going forward.

Parents feel like they can’t speak to their children about money yet we need to talk to our children about money and how it works. You don’t need to scare them, you don’t need to give them anxiety about it but you do need to speak to them about how money works in your household.

So, let’s say you and your husband are working and the money comes in to the house. Well you have to think of your household like a team and your children need to be part of the team. They need to know that yeah, maybe the kid down the street is getting a car for his birthday or he just got a bike or he is going to take ice skating lessons, but we can’t and here’s why.

If you tell children why, if you speak to your spouse or your significant other with whom you’re sharing expenses about the why and the what you will not argue and feel as anxious. Start talking about it to your children and with your spouse. There should be no secrets… it shouldn’t be about “oh! I just spent $35,000 on a purse, I can’t tell my husband that.” 

You might be one of the countless men and women who think overdraft protection is a good thing…

I’ll show you why you’ve been led to believe that and what the truth behind it really is.

Let me start off by saying that there might be rare instances where overdraft protection might help you. For example, if your rent check would bounce or your mortgage payment wouldn’t go through …

Yet in reality,  here’s what overdraft protection really is: it’s a loan from the bank to cover mistakes that you might make in math.

You should never be relieved to use overdraft protection. Overdraft protection is something that you should ideally never touch…

It is a loan and it costs you money. Overdraft protection has to be paid back, the bank might either take the money back automatically next you time you deposit, or you might have to make a separate payment… it depends on your specific bank
and contract.

And keep in mind, since the bank sees you as a financial risk, there might be substantial interest applied to this loan.

You cannot rely on overdraft protection just as you can’t rely on your credit card to cover you when you don’t have money in your checking account. 

I’ve even heard that some banks are talking about getting overdraft protection on your credit score. Can you imagine? It’s really not a good thing to have your credit score go down because of an overdraft protection mistake.

Now, I don’t know if any of you heard of this amazing story…

There was this female university student from London. The bank apparently made a mistake and gave her overdraft protection for everything she was buying. And even though she had virtually nothing in her checking account,  she managed to spend around $3 million  in overdraft protection.

And guess what?  The bank considers it a loan and she has to pay it back.

So here you have this young college student who thought “Oh! I’m not even getting what’s going on but the money is always there in my account!” To be honest, I’m not quite sure what she thought.

And this is a prime example of you not keeping track of your funds… No one should really want or need overdraft protection. Just remind yourself: it’s not a good idea, its not a good idea.

It should be there only in case of an emergency situation, and hopefully if you’ve been going through our videos, you’ll be prepared to avoid those situations altogether.

It’s important to learn to live within our budget (except for emergencies which everybody has).  We also want to learn to have discretionary funds which means we have money to play with. This is what you want to do instead of using overdraft protection.

Because all that will cause you is anxiety, sleepless nights, guilt, anger, and even shame. So let’s do things the right and healthy way and say no to overdraft protection.