Know Yourself Know Your Money by Rachel Cruze
Discover how understanding your financial habits can lead to smarter money decisions and healthier relationships.
Know Yourself, Know Your Money by Rachel Cruze explores the psychological side of personal finance. Cruze shows how understanding your money habits – often shaped in childhood – can help you make smarter financial decisions and improve communication with family and partners.
Your Childhood Money Classroom
“Childhood either enables you or stunts you; it doesn’t create you“
- Childhood experiences shape adulthood
- Subconsciously influence mindsets
- Different experiences aren’t inherently better or worse
- Siblings can interpret differently the same experiences
- Children learn emotionally and verbally
- 4 Types of Childhood Environments
- Unstable: Open & Stressed
- Anxious: Closed & Stressed
- Secure: Open & Calm
- Unaware: Closed & Calm
Stressed Classrooms
- Unstable (open & stressed)
- Constant fighting & yelling, open communication but negative
- Later Challenges: expectation of conflict, tendency to ignore money
- Anxious (closed & stressed)
- Rarely heard discussions; tension instead of direct arguments
- Observed habits; discouraged from asking questions
- Later Challenges: difficulty opening up, fear around lack of money
Calm Classrooms
- Secure (open & calm)
- Open discussions about money, everyone on the same page
- Not necessarily financially strong, but making intentional decisions
- Later Challenges: underestimating responsibility it takes, feeling entitled
- Unaware (closed & calm)
- Never knew specifics about family finances but felt taken care of
- Short-term great emotionally, long-term lack of understanding
- Later Challenges: struggling with responsibility, avoiding finances due to discomfort
Your Unique Tendencies
- 7 Most Common:
- Saver vs Spender
- Nerd vs Free Spirit
- Experiences vs Things
- Quality vs Quantity
- Safety vs Status
- Abundance vs Scarcity
- Planned Giving vs Spontaneous Giving
- Current needs can distort what is natural – what is instinctive?
- Knowing your tendencies helps you communicate with others
- Find a balance
- Ex → If you save everything, you’ll miss experiences
- Ex → If you spend everything, you’ll be broke
Responding To Mistakes
- Too Much Grace → Enabling
- Enables self-destructive habits by avoiding consequences
- No boundaries, rarely taking a stand
- Recognize the issue, set boundaries, and stick to them
- Too Little Grace → Legalism
- Efficiency prioritized over relationships
- Sacrificing relationships to be right
- Remind yourself that mistakes are normal and okay
