From Financial Trauma To Financial Freedom: How Childhood Money Lessons Shape Your Earning Potential

Your parents’ money baggage became yours. Sad to say it, but that’s really just how it works (whether we like it or not).

Maybe you heard “We can’t afford this!” every time you asked for something as a kid (um, because I know I did). Now you’re 30 something, making *good* money (which may or may not be relative these days), and you still feel guilty buying yourself a nice dinner. Or maybe you had a relative who swears they “lost all of their money investing in the stock market,” so you’ve been keeping your savings in a regular checking account for the last decade, watching inflation eat away at it.

Sigh.

These aren’t just bad habits. According to Vivian Tu, Founder & CEO of Your Rich BFF and host of Richer Lives, they’re actual scripts running in the background of your brain, quietly sabotaging every financial decision you make.

“The money scripts we inherit are real, and they can be silent killers to your financial progress,” Tu says. She sees two big ones come up all the time. First: the idea that money is evil. “When people believe things like ‘rich people are greedy’ or ‘money is the root of all evil’, your brain will literally work against you to avoid wealth—leading to poor financial decision-making, like missing out on saving or investing to make your dollars grow.”

The second script is the opposite problem, because for most, they think money will fix everything. “This script makes people workaholics or compulsive spenders, always chasing happiness through a number in a bank account,” she explains. Either way, you’re stuck. “We act out these scripts automatically, and they absolutely influence every dollar we earn, save, and spend as adults.”

So how do you stop repeating patterns you didn’t even know you had?

Tu says you have to start with awareness, which sounds simple but really means sitting with some uncomfortable questions. “You have to figure out the ‘why’ behind your fear or guilt,” she says. Take that spending guilt example. If you grew up hearing “We can’t afford this!” constantly, you probably internalized the message that wanting things is bad. 

Something that we also have to grapple with when it comes to these scripts is that our  parents and/or grandparents faced actual systemic barriers such as redlining, discriminatory lending, or being shut out of the GI Bill benefits that built white generational wealth, which contributed to that “we can’t afford this” mentality. Sometimes it wasn’t just about budgeting, but about survival. So of course its no wonder the script runs so deep.

For people scared of investing, Tu says to look closer at those cautionary tales. That relative who lost everything? “More than likely, that person may not have had a portfolio well suited for their risk tolerance, and understanding that might help someone overcome their fear.” The takeaway: “Everyone needs to realize money is a tool, and it’s morally neutral.”

But let’s be real—that investing fear carries extra weight when you know your family was historically locked out of wealth-building opportunities. The stock market, real estate and business loans weren’t neutral playing fields. So when someone in your family finally got in and lost money, it confirmed what you already suspected: this game wasn’t built for us. Except now, staying out means watching the wealth gap get wider.

Here’s the thing you should understand (and repeat it over and over again to yourself if it will be helpful): you’re not broken. Write it on a post-it even! “You weren’t taught this stuff in school, so you’re not ‘bad with money’—you’re just starting your journey now.” Tu recommends getting judgment-free advice wherever you can find it. “The best way to overcome fear is by getting judgment-free, actionable advice. Look into the kind of benefits your financial institution offers.” The more you talk through these money hang-ups with someone who actually knows what they’re doing, the faster you can start undoing the damage.

But talking about it only gets you so far. Tu’s advice for people ready to actually do something? “Do the math and know your numbers.” List your assets, your debts, what you’re working toward. Then she breaks down her STRIP method—Saving, Total Debt, Retirement, Investing, and Planning.

Start with saving. Get a high-yield savings account for your emergency fund where the money actually grows while it sits there. Then tackle debt the smart way. “Use the Avalanche Method (making the minimum payment across all your debt, but paying down the debt with the highest interest rate first with any additional debt paydown funds) to be mathematically smarter about debt repayment,” Tu says. If you’re barely making a dent, she suggests looking into consolidating everything into a lower interest personal loan.

After that, retirement. Fund your 401(k) or Roth IRA, even if your job doesn’t match. Then investing—”Start investing early, even if it’s just a little bit, and focus on simple things like automated investing rather than trying to cherry-pick stocks,” Tu advises. Finally, automate everything and actually plan. “What does a ‘happy’ retirement look like for you? Are there intermediary moments where you’d like to have money to spend? A home? Car? Wedding? Figure out what you want, and work backwards from there!”

The scripts your family gave you about money might have made sense for their circumstances. They were shaped by a system that made wealth-building nearly impossible for Black families. But understanding where those scripts came from is the first step to writing new ones. They don’t have to be your story forever.

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