Stuck In a Box?

Our conscious mind likes to create “boxes” that we use to organize the world around us. These boxes are often created through our upbringing and the influence of our parents, peers, society, and the media. Sometimes a box comes about simply because certain goals and dreams have been imprinted so deeply into our systems that we can only see that one box clearly, and we are unable to see anything else. Other boxes may be created as a defense mechanism to avoid anxiety.

Sometimes we may have anxiety about how to deal with money. Most of us organize the way we think about and handle our money into these types of compartments. Creating these boxes may help us be able to feel safer, since dealing with money often comes with emotions, both good ones and bad ones.

Here are a few examples of these types of boxes:

■ Keeping a significant amount of cash in the bank, ensuring that a particular threshold is always attained, without being open to considering any other opportunity
■Holding debt with interest payable (line of credit or credit card) while holding cash or a term deposit that doesn’t earn much interest at all
■Not paying off in full a specific credit card because the credit card is earmarked for a certain expense or because the room available on a line of credit (or the cash in the bank) is earmarked for something specific
■Focusing solely or almost entirely on paying down a mortgage as a main goal before considering other opportunities to increase net worth in a more efficient manner.

In some situations, it’s excellent to have these types of boxes. Sometimes the boxes help us deal step-by-step with managing our money better, especially if money causes some anxiety. The boxes can help us focus on one goal at a time. On the other hand, this type of compartmentalization often narrows our thinking and hinders us from making bigger-picture connections; it may also hinder us from being as efficient with our money as possible. As we learn more and become more sophisticated in managing money, our fears about money may start to subside, and the boxes may start to disappear with them.

It’s always good to explore the boxes that we have, figure out why we have them, and understand whether it’s best for us to keep the boxes closed or open the boxes up. Usually, the only way we will even know that we hold on to boxes is by allowing a third-party expert into our financial planning process. The things that have been drilled into us and the things that we have learned over many decades can also be unlearned. The boxes can be opened, mixed up, bigger boxes can be made, and many of the boxes can even be removed. And usually, removing the boxes and allowing ourselves to think outside of the box creates the most efficiency and allows for the best strategic planning.