Any trauma that someone experiences can impact their relationship with money, Chantel Chapman says.Supplied
Chantel Chapman is the founder and chief executive officer of The Trauma of Money Institute, a financial literacy and psychoeducation program that offers certification for professionals in trauma-sensitive approaches to finance.
Her first book, The Trauma of Money: Mapping Compassionate Pathways to Healing Financial Trauma and Disempowering, was released last month. Globe Advisor spoke with Ms. Chapman recently about her experiences and how she came to specialize in trauma education:
What is money trauma?
It’s an emotional response to issues such as poverty, economic abuse, a sudden loss of assets, divorce, or an inability to retire due to a lack of financial means. In our research, we’ve also found that any trauma someone experiences, even if it has nothing to do with money, can affect their relationship with money.
Trauma is a wound that impacts our sense of self-worth, security and safety. What does money represent? Worth, security and safety. So, if we have wounds from trauma that have nothing to do with money, of course, our interactions with money will be impacted.
Describe your background and experiences with trauma.
I was born and raised in Richmond, B.C., by a single mother. I’ve never met my biological father. I also have a younger brother. He had a different father who had addiction issues and was in and out of our home when I was a young child. I’m also a survivor of sexual abuse.
I grew up in an environment of financial scarcity. My mom worked really hard to try to make ends meet, but it was always a struggle. As a kid, I used to focus a lot on what food other people had that we didn’t. As a teenager, I became obsessed with being around people with money and who had nice things, and put them on a pedestal.
What was your relationship with money like before you created The Trauma of Money Institute?
Despite having a very successful career in finance – I worked in fintech and ran a financial literacy education business in Canada – I struggled with deep-rooted money issues, such as overspending on myself and others for external validation. I would use my money as a ‘please, love and accept me’ fund. It was exhausting. By default, I avoided financial responsibilities; I filed my taxes late, ignored bills, and while I helped others with their budgeting, I wouldn’t do it for myself.
About 13 years ago, I started going to therapy. Every time I went to a therapist and brought up some of these money behaviours, they would say, ‘Have you tried budgeting?’ or ‘Have you tried willpower?’ I realized that a lot of mental health professionals don’t get training around the stressors and the psychology of money.
So, I went on a five-year research journey studying trauma, addiction recovery and neuroanatomy. I then studied community economic development, examining some of the systems we live in and our economically dominant culture. I didn’t have a goal; I just wanted to do all of this training for myself and start sharing these insights with others.
That’s where I decided to formalize my years of research and training, bringing in different experts to create my own certification program. The Trauma of Money Institute now has 25 faculty members, and we train mental health, finance and other professionals in a trauma-sensitive approach to money.
[The program has been approved for continuing education credits by the accredited financial counsellor Canada certification, as well as legal and psychotherapy bodies. Portions of the program delivered through training courses to individual financial organizations have also been approved for CE credits from FP Canada.]
How can advisors benefit from trauma of money training?
We’re not training the advisor to become a therapist. We’re training them to recognize when their client has financial shame and providing them with the resources needed to respond. A big part of what we teach is to continue moving away from people taking full responsibility for their money trauma and to acknowledge some of the economic systems in place that can create barriers for people. By doing this, you can help to reduce the financial shame that people have, which ultimately empowers them.
How can advisors spot if a client might be affected by financial trauma?
One is avoidance, when a client isn’t returning calls or not filling out the paperwork. That was my experience. Another is a client’s struggle to articulate a financial vision for the future because they’re stuck in what we call the ‘scarcity tunnel.’ The brain doesn’t know the difference between real or perceived scarcity.
When the brain is in a state of scarcity, it goes into tunnel vision, and the person becomes hyper-focused on the present moment; they experience goal inhibitions. It can make it really hard for them to answer an advisor’s questions about their vision for retirement. So, instead of bypassing the tunnel, we teach advisors how to work through it with their clients.
What’s one piece of advice you have for advisors who want to be more sensitive to a client’s money trauma?
The way advisors ask questions can be helpful. We teach them to ask open-ended instead of closed-ended questions. An example of a closed-ended question is, ‘How much have you put aside for retirement as of now?’ That may sound like a normal advisor question, but the client might feel there’s a right or wrong answer, which could trigger stress or shame.
An open-ended question would be something like, ‘What do you imagine your ideal retirement looking like? And how do you see your work with me supporting that vision?’ Once you start asking what we call these ‘curious questions,’ the advisor can learn places where a client might be holding shame.
This interview has been edited and condensed.