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Financial planning is often viewed as an analytical, numbers-driven process, but a growing movement is applying mindfulness practices to managing their money.
Taking time to calm your nervous system through meditation, journaling or a moment of reflection may lead to better financial decisions through an increased level of self awareness, according to experts.
“Meditation impacts the way we think and the way we perceive things,” Erika Polsinelli, founder of the mediation app Evolve, told BNNBloomberg.ca.
“It can change how we look at money, how we save money and how we choose to spend it, among other things.”
When someone practices meditation, they are influencing their nervous system through breath, Polsinelli explained, which can make an individual less reactive and impulsive in their decision-making.
“A meditation practice can take as little as three minutes of your day to be effective and create a shift in your state of mind. It’s a really quick way to make changes in your life as fast as possible,” she said.
Kundalini mediation, which the Evolve app uses, involves breath work, mantra, movement and mediation to guide people through that inner shift.
MONEY HABITS A REFLECTION OF OURSELVES
Robyn Thompson, president of Castlemark Wealth Management, said the ability to slow down can help someone reflect on their overall money habits.
"When someone overspends repeatedly on things that provide little value, it puts them further from their goals and they will start to feel conflicted inside,” she told BNNBloomberg.ca.
According to Thompson, that’s because how we spend our money can be a reflection of how we think and feel about ourselves.
“When our money is handled, we feel great. When it isn’t, we start to doubt ourselves and question who we really are, because who we think we are and what we’re moving towards (are) in conflict with each other,” she said.
“People forget that finances have two sides. One is analyzing the numbers, the other is emotional. You need to understand why you have certain money habits.”
PORTFOLIO MANAGER SAYS MEDITATION GIVES HIM CONFIDENCE
A portfolio manager who oversees $205 million in assets told BNNBloomberg.ca that practicing meditation has been a huge asset to his career.
“Meditation made me push past this idea that I wasn’t worthy of the success I had created for myself financially,” Michael Preto, portfolio manager at Hillside Wealth Management, iA Private Wealth Inc., said in an interview.
“When you have those daily moments of concentrated breath, you find a level of calmness and confidence you didn’t know you had.”
Preto said meditation has benefited his work and his personal life, as it has allowed him to think bigger, view life from a different perspective and stay calm in stressful situations.
“It’s caused me to step back and make decisions from a place of great confidence when perhaps others may be panicked, like during a market selloff,” he explained.
For others, practices like journalling may help them explore how they view money and what patterns they need to change.
HOW TO TAKE A MINDFUL APPROACH TO MONEY
Wendy Brookhouse, certified financial planner and chief executive officer of Black Star Wealth, told BNNBloomberg.ca about how she encourages her clients to take a mindful approach to their money from the very beginning of their work together.
“Before I build a spending plan for clients, I have them journal the following questions: What’s your first memory of money? How did you parents handle money? ‘What did you love about it?” and ‘What are some financial habits you wouldn’t want to take on from your family?”
In Brookhouse’s view, these questions allow people to safely explore where they stand on these subjects and see how that perspective may be influencing their money decisions.
“A weekly moment of reflection also helps lift the veil of money,” she said. “You become less afraid of it and come to understand it and your relationship with it much better.”