3 Steps to Forgiving Yourself for Financial Mistakes

You’re listening to the Mastering Money in Midlife podcast with Debbie Sassen, Episode 46.

Welcome to Mastering Money in Midlife, a podcast for midlife women in business to overcome financial anxiety and make more money without burning out or sacrificing their families. Join Certified Life and Money Coach Debbie Sassen, as she shares practical business strategies and mindset shifts that help you dissolve the money blocks that keep you stuck in a cycle of under earning and under saving, sabotage the growth of your business and prevent you from building the wealth that you desire.

Hello, my friends and welcome back to the podcast. We are in a new Jewish year. So, I want to wish all of my listeners a Shana tova, Happy New Year, and give you my dearest blessings for sweetness and abundance and prosperity and all the joyous things that you are praying for and dreaming and hoping for this year.

We had a lovely and meaningful Rosh Hashanah with our family. I hope you did as well, wherever you are in the world.

Last week, I spoke on the podcast about setting your financial goals for the next year. And now that we are approaching the last quarter of 2022, you can use last week’s podcast, if you have not yet gotten to it, to really think about what you want to create financially in your business and in your life for the next 12 months. You can also use last week’s podcast to just focus on what you’re going to complete in the next quarter of 2022.

But I always recommend that you set specific financial goals with a deadline, because that helps you measure where you are on your journey. And you can tweak what isn’t working. You know what is working in your money and in your business and you can tweak what isn’t, and that will help you to move closer to your destination.

Today, I’m going to speak about the emotional side of money. And I’m going to cover three steps to forgiving your financial mistakes. Financial mistakes happen to all of us. But very frequently, there are such heavy emotions surrounding our mistakes, that it keeps us back. We think that we’re wrong, there’s something not good enough about us. And that sort of emotional heaviness’, and that baggage that we’re carrying, will stop us from actually setting out that plan that I’m talking about, and moving forward toward it.

So, we’re going to follow a three-step process that the Rambam gives us for forgiveness. The Rambam was a very influential Torah scholar and Jewish philosopher who lived in the Middle Ages. The Rambam, also known as Maimonides, was born in Spain in 1138, and he died in Egypt in the year 1204. And he had a very prolific history; was very well known.

And he was also a physician, to the Saladin in Egypt, toward the end of his life, and also, in the next dynasty that reigned in Egypt after the demise of the Saladin. So, we’re speaking about someone who’s incredibly intelligent and understood both the physical body and the emotional makeup of the body, and was also a tremendous scholar, understanding our Jewish sources.

And the Rambam gave us a three-step process, to forgiving ourselves for our sins; our sins between us and God, our sins between man and man. And I think that this three-step process is also very useful when we want to forgive ourselves for the financial mistakes that we made.

I’m not speaking today about financial mistakes between two people. Perhaps somebody borrowed money from you and didn’t give it back. Perhaps somebody injured you and there were financial repercussions. Or, if you have a rental property. We had a rental property once, and the people who were living there, our tenants, they actually still owe us an amount of money that is equivalent to about $3,000. Because they left and they never paid us for the last few months of rent.

So, there are financial sins, let’s call them for lack of a better word, between man and man, and we’re not going to be addressing those today. We can speak about that on a different podcast. How you want to forgive other people for the things that they did, and move on.

Today, we’re speaking only about your money mistakes. The three-step process that we learned from the Rambam, also known as my Maimonides, is number one; regret, regret for what you did. Step number two is confession, to talk about what happened. And step number three is committing not to do it again. And, we’re going to speak about, specifically, what that is and how it looks.

Before we get to regret, however, what I would like to share is that there are some other emotions that can prevent you from getting to the stage of regret. When I meet with my clients who’ve made their financial mistakes, and I’m very open about speaking about my big money mistake, where I lost $50,000. So many of my clients feel tremendous shame, or guilt about what happened with their money.

And I’m going to speak about the difference between shame and guilt. And we learned the difference between guilt and shame from Brené Brown. Brené Brown says that shame has an underlying message of “I am bad”. Whereas guilt, has an underlying message of “I did something bad”.

And, I’ve had people share with me both of those feelings. We didn’t really go down deeply into the underlying, you know, “Am I bad? Did I do something bad?” and the difference between that. But people speak about their financial mistakes with both shame and guilt, also embarrassment.

And there’s a very heavy feeling, brings up a lot of negative emotion. And I think it’s that sort of like confession stage that the Rambam talks about, that they get to when they’re meeting with their money coach. And perhaps also, if they have a financial therapist, and they’re speaking about their mishaps with money with a qualified professional.

When we want to get to the stage of regret, what I often see when I’m meeting with my clients and we’re doing our work, and that can be just speaking about what happened, dropping into our body, understanding where the energy is like vibrating, and coursing, and pulsating through their body, that might be one way of getting in touch with the emotions that are in their body.

Very often, we do some tapping around the emotion, to move the emotion and move the energy. I will be sharing with you, in the show notes, a tapping video that is on my website. It was recorded four years ago, at this time of the year. The quality isn’t great, so you’re gonna forgive me for that mishap, okay. But it is very, very effective to move the shame, and the guilt, and the embarrassment, and any other heavy negative emotions you are feeling around your financial mistakes.

What I would recommend first, is that you write them down on a piece of paper. When they’re in your brain, and they’re taking up space in your mind, it can feel so overwhelming. Once you can get your thoughts, what went wrong, what you did wrong, what you’re thinking about yourself as a person.

When you get it out of your mind and onto a piece of paper, using a pen or a pencil, you become a witness to or a watcher of your thoughts. And it gives you a lot more clarity about what is really happening. It’s no longer a part of you. It’s something external. And we have a little bit more clarity and self-compassion, when we’re witnessing something rather than believing that we are the heavy thing, and that we are filled with shame and filled with guilt.

So, I encourage you to take 15 minutes, 20 minutes, half an hour, and write down on a piece of paper, all of the things that you’re feeling shame, guilt, embarrassment, or whatever, about in your finances. It could be that you made an investment, like I did, that you really had no business making.

Could be you stole money out of your parents drawer when you were a little kid. Or, perhaps, you stole something from the supermarket. Or, you cheated on a test and because of that you were able to get a job, and you got paid money. Or, you cheated on your tax return.

Whatever it is, write down everything it is that is making you feel uncomfortable around your money. Nobody ever has to see it. After you write it out, and after you do some tapping and moving the energy, you can burn up your piece of paper.

And once, by the way, I actually did this exercise and I had over a page, I probably had a page and a half, like on both sides of it. And afterwards… And I did some clearing on my financial mishaps. And also at that time, I added people who owed me money, or who I felt cheated, or did something inappropriate with money towards me. I took my piece of paper outside, I put it in a disposable aluminum dish, and I burned it.

And I felt so much better afterwards, because it was like out of me, and then it was gone. And it actually drained me for about a day and a half, because it just felt like so much energy, that had been stuck in my body, was released. And when we just start shifting energy, our body needs to heal, and it needs to rest.

You want to create time and space for you to like slow down a little bit, drink some water, lots and lots of water, actually. And you might want to put an extra hour of sleep on your schedule, either during the day or during the night.

Brené Brown says, about shame, that it cannot survive being spoken. Shame needs three things to survive: It needs secrecy, silence, and a judgement. Meaning, we’re judging ourselves for our financial mistakes. And I’m going to put together the shame, the guilt and the embarrassment.

When we don’t talk about them and we hold them inside of us, it takes a tremendous amount of energy. What I find with my clients is, after we get it out, and we can be a witness to or a watcher of our negative emotions, and then we can do some tapping to start shifting, and healing, and clearing, those negative emotions, most of my clients moved to sadness.

I don’t think I remember that anybody specifically used the term “regret” but they feel like, so sad that they made this financial mistake. And hey, I really want to give you the benefit of the doubt, because very, very few of us were taught anything about money when we were growing up. Money is like the final frontier. It is the last taboo that is being broken. We are finally, in 2022… It’s really been going on for about the last 10,20, maybe even 30 years, but we are finally talking about money.

I can’t remember how many years ago it was now, but when my grandmother died, my father’s mother, I received $5,000 as an inheritance from my grandmother. And I was, first of all, I don’t think I was grateful. And like if I really think about it, I should have been overjoyed and had so much gratitude and thanks, for my grandmother.

I do remember asking my dad, saying, “Daddy, what should I do with this money?” And he really didn’t give me any direction. Right? It’s not his fault. You know, many parents did not help their children figure out what to do with money, we were just supposed to figure it out by ourselves. He told me, “Go down to the bank and ask them what to do with it.”

So, at the time, I went down to the bank. I put it into a certificate of deposit. I didn’t know really, too much about what I was doing, but I did. I figured “Okay and I’ll earn some interest. And then, in a few years from now, I’ll have more money.”

Now, here’s the crazy thing about it. I moved to Israel, and I didn’t pay close attention to what was going on in that bank. I had a number of accounts in that bank; there were savings and checking, and the certificate of deposit, and I think maybe another account. And my little regional bank was bought by Citibank.

And somehow, in the computers, that $5,000 certificate of deposit, the paperwork or the computer entry didn’t get transferred over to Citibank, it became an unclaimed account. And because I wasn’t in touch with the bank very often, I was in Israel, the account was in Los Angeles, it was ultimately remitted to the State Comptroller of California as unclaimed funds.

And I had to jump through hoops, in order to get that money back. I had to go and get it notarized with red ribbons and a fancy gold stamp, send it off to the state comptroller in California. I finally got my $5,000 back. But as a side note, if you have financial accounts, pay attention to them. Make sure that your addresses are up to date, and that you actually have movement of funds from time to time, in your accounts.

Because there are billions, probably trillions of dollars in the world of unclaimed funds, because people just lost connection with their money or people died. The records and reportings and the computer systems, that we have today, were not as good. And people just had money that didn’t get claimed, and it’s sitting in comptroller’s offices around the world. All right.

So, what happens with my clients when we start shifting their feelings and emotions around their money, and they no longer feel this heaviness, and their guilt and their shame, now we can move into sadness. And, I’m going to call that the stage of regret.

And when we get to regret, this is the place where we know that something could have been done better than it was actually done, but perhaps we didn’t know how to do it. We didn’t take the time to figure it out, we were in a rush. You could have been embarrassed.

 Like, when I think back to my $50,000 money mistake, and I didn’t do the due diligence, I was in a place of being greedy. Like, and I know this from doing my own work, is that I wanted to make money, I thought that I was a big shot, and I could make money quickly, and I was being driven by greed. So, it wasn’t, here, the shame and the guilt.

But even just talking about it and saying, yeah, I was being greedy. Greedy for more money, greedy to make a quick profit. And being able to say that and confess it, talk about it, just normalize the fact that we, human beings, are driven by emotions, takes away so much of the charge around the event that happened.

But there was probably something that happened because you were doing the best you could at that time; coulda, woulda, shoulda have maybe done it differently. You had your reasons for not slowing down and figuring it out, and doing it differently. It could be it was because of the way that you were raised around money.

That money was such an emotionally charged topic, that you just wanted to bury your head in the sand and not deal with it. Or, it could be you thought you knew what was going on. Or, there was that greed, or some arrogance, or elitism, or whatever it was around money. You made a mistake. And you’re like; Yep, I could have done better. If I could turn back the clock right now, I would have figured it out.

But you didn’t. So, once you can feel that regret, now it opens you up to doing things differently. And because you’ve already written it down on paper, and maybe you’ve done some tapping on it, or you’ve done some journaling on it, or something else, you’ve actually burned it, like I recommended, right. You’ve regretted your mistake and you’ve talked about it; you’ve confessed it.

Now we can get on to step three, which is, committing not to doing it again. So, the question is, if you made a financial mistake, like I did, investing in something that I never should have invested in, how do I commit to not doing it again? Number one is education.

If there are things that have to do with money that you don’t know, you can get yourself some financial education. Google® is your friend. Anything that you don’t know about with money, you can just put it into Google and Google will give you more answers than you will ever know.

When it came to investing in the stock market, I did so much research that I ultimately wrote a book, the 1K Investor: Simple, Smart Steps to Start Investing with 1K or Less. And believe you me, I have never made that same financial mistake again. I took back control of our investment accounts, from the investment managers who were managing our accounts, and only I now invest our money.

We do have some pensions in Israel, and because of the way things are set up here, we do have financial managers for our pension accounts. But the money that is in our US dollar accounts that I manage, because I now understand and feel confident that I can manage the money.

Your mistake might be that you got into a tremendous amount of credit card debt. That is a very prevalent money mistake. Many, many people are in credit card debt, or in Israel in overdraft, in other countries of the world. Or perhaps, you borrowed money from somebody in your family, you simply owe other people money.

When you commit not to doing that, again, you actually create a financial plan, where you have a line item in your monthly spending plan or budget, for paying back your loans. That can include reducing your expenses and increasing your income, so that you have more money available to pay back your loans.

If you stole something, and that was your financial mistake that you made, maybe there’s a way that you can also… You might feel a tremendous amount of shame if you would approach somebody and admit that you stole something. I’m not going to be your religious leader, your spiritual leader, and tell you exactly what you should do and how you should make amends.

But I can actually think about a situation right now, as I’m recording this podcast, I can just feel all the tension rising up in my body as I imagine somebody going and confronting someone from whom they stole money. And, that can be a very emotionally triggering event.

But that’s something that if you wanted to make sure that you didn’t do again, and you really wanted to make amends, you could figure out how to do it by reaching out for help to a religious or spiritual leader, also a coach or therapist, so that you can change that situation around and never face it again.

Many of my clients have been in debt to the tax authorities, and they’ve created payment plans, so that wouldn’t happen. Again, if you want to make sure that you always have money to pay your taxes, as a business owner and as an entrepreneur, make sure that you have a savings account set aside specifically for taxes.

Every time one of your clients pays you money, if they pay you $100, make sure you take 30 or $40, and you put it aside into your tax account. Do it in real time, don’t wait till the end of the year. So many entrepreneurs are chasing their tails, and creating sales, and selling things at the last minute, so that they can all of a sudden come up with a large amount of money to pay their tax bills.

If you want to not get into tax debt, again, create a plan, so it doesn’t happen again. It doesn’t help you to solve last year’s problem, but you can make sure that going forward, it doesn’t happen. And then, you just have an outstanding debt to your tax authorities, and you’ll pay that over time. It might require that you reduce your standard of living for a little while, while you’re paying down your debt. But that is really all it takes.

It’s very, very simple. Not easy, because it might require that you say no to some things, while you’re fixing your financial mistakes. It might require that you actually create a plan and stick to the plan, in spite of your desire to go off plan and do things differently.

You might have other things to do with your time. Somebody was in a conversation with me on LinkedIn® recently, and at the end of the conversation, she said, “Now I have to figure out when I can find the time to read your book.” I was like, “Well, you can set aside 10 or 15 minutes a day and commit to that plan.”

It’s simple. It’s not always easy, because something is going to come and draw your attention away, or you’ll push it off till the end of the day, you’ll be very tired. And you won’t want to engage in learning about money and becoming more literate with your finances; learning the jargon, learning the lingo, saying no to some spending that you might want to do because you want to, you need to, you’ve committed to putting money aside in your savings account.

But there are three simple steps to forgiving yourself for your financial mistakes. Number one is, feeling regret. Regret is, again, on that spectrum from shame and guilt and embarrassment, we’re moving towards more neutral emotions. Regret is much more just a recognition that something happened that you would prefer didn’t happen.

But you’re moving towards feeling financially in control and on top of your money, and feeling that financial freedom, which is where we all want to get to. But it’s no longer that secretive and self-judgment that you’re putting on yourself for making that mistake. So, number one is, regret.

Number two is, confession; just talking about it, creating neutrality, just taking off that emotional charge because we’ve become a witness to our emotions.

And step number three is, creating the plan and committing to the plan. So, whatever financial mistake happened, there’s a 90% chance it’s not going to happen again.

That’s what I have for you today, my friends, before the holiday of Yom Kippur. This is the holiday, in the Jewish world, when we ask God to forgive us for the sins that we committed against Him. And this is one of the ways that we forgive ourselves, we can come closer to God, is that we forgive ourselves. And we take away the barriers between us and our Creator.

I wish you a Shana tovah u’metukah tovah. It should be a good year and a sweet year, and I bless you that you should have financial freedom, and financial abundance, and financial prosperity this year. Bye-bye, my friends.

Thanks for listening to Mastering Money in Midlife. If you want more information on Debbie Sassen or the resources from the podcast visit MasteringMoneyinMidlife.com.