ICR320: Hayley Tink, Behavioural Money Patterns
My guest today is Hayley Tink.
Hayley is the first Chartered Financial Planner in the UK to also be a Certified Money Coach.
She’s able to bring this new dimension to her financial advice work, as well as providing stand-alone money coaching sessions for those who wish to understand the psychological dimension of their own relationship to money.
The concept of Money Coaching is still relatively new in Financial Planning circles and it was great to speak to Hayley for this episode to learn more.
Hayley shares in this episode how family attitudes and external influences can influence our behaviours around money and these can sometimes have an unhelpful effect on making important financial decisions.
Here’s my conversation with Hayley Tink, Certified Money Coach, in episode 320 of Informed Choice Radio.
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Useful links
-Almary Green
Interview transcript
Martin: Well welcome back to Informed Choice Radio. I’m delighted today to welcome Hayley Tink. Hayley is a chartered financial planner and a certified money coach.
So Hayley, welcome to the show. Could you start by telling us a bit about you and your background, and what this is, what is a certified money coach?
Hayley: Yes sure. So yes, as you say, I’m a financial planner and I’ve been doing that for probably about the last 14 years or so. Very much no [inaudible 00:00:29] client work all of that time, and pretty much that’s how I operated until about two years ago when I really was just doing some reading around money and the psychology of money, and that lead me into looking more into those aspects. And so yeah I found some training around the area of behavioural money coaching and pursued that, did some training and so now I’m kind of combining that with my financial planning.
Martin: And did you always want to work in financial planning, financial coaching? Was that a dream as a child for you to get into that market?
Hayley: No, is the honest answer. I think like many people it’s something that maybe I fell into as a result of getting a sensible job when I left university. Interestingly I’d always had an interest in behaviours and people when I was doing my degree, so it’s actually almost coming back to some of my original interests in a way. But yes I kind of fell into financial planning I would say, but I think the people side of it is something that I’ve always really enjoyed.
Martin: The work you do … So your role today combines that of a financial planner and a behavioural money coach as you just said. Could you tell us a bit about the difference between those? So I guess our listeners might be familiar with financial planning, they might be familiar with coaching as a principal, but how would you define those two and explain the difference between them?
Hayley: Well I think my financial planning work is very much around having a look at what somebody actually has, what their goals and plans are for the future, and then using technical expertise to help somebody come up with a plan for that and to also help them run that. Whereas behavioural money coaching, it is really all about what’s going on inside our heads with regards to money. The coaching aspect, the idea is that as someone that has trained in things like what does the brain do with money and what are our patterns and behaviours, I can then act as a bit of a guide and a coach to someone to help them reveal some of those aspects that are going on. So I think probably the reason it works so well together is that if you’re helping planning someone’s future there may be aspects going on behaviorally that they’re not aware of. So I can help bring that to the fore so we can allow that to be part of the plan, if that makes sense.
So there may be some potential road blocks that those aspects create. There may be things that are getting in the way. And sometimes, I mean those can be both positive and negative, so it’s being aware of all of that that’s going on to help support the financial planning.
Martin: So what are some of these psychological dimensions that relate to our relationship with and our patterns around money?
Hayley: I think that the main one and probably the most challenging one for us as human beings is that our decisions around money don’t tend to come from a very logical place. And if you think about it, when we’re making decisions over our future and how we’re gonna be saving and spending our money, we’d like to think that logic is in charge. But we’re not really geared up that way, and that means that if we’re not aware of that, that can influence what we’re doing, even when we think we’re being logical it may not be the case. So I think it’s being aware of that and what’s going on underneath, and allowing that to make us a little bit aware as we’re dealing with money on a day to day basis.
Martin: So what is it about our brains and the way we’re wired which makes us poorly suited to dealing with money as you say, making emotional rather than logical decisions?
Hayley: Yeah that’s right, there’s a lot of emotional stuff, there’s also a lot of habitual as well. So I think the main thing is it’s partly how our brains are constructed for all decision making. I’m sure you’ve read lots around how a lot of our decisions in life are not as logical as we would like to think. But in particular I think another aspect when it comes to money is that money hasn’t actually been around that long as far as in our culture. That the actual operation of money in its current form has only been with us potentially, even if you look right back through prehistory, only a few thousand years.
Whereas our brains, well they’ve evolved way before that when we became our current status as humans. So if the thing doesn’t exist when our brains have evolved then it does make the ability for our brains to recognise it as a thing that’s logical and not related to other aspects, that makes that more difficult. And there have actually been some studies with some brain imaging techniques that have shown that when we do make decisions around money, when we’re asked to think about money, it’s the same parts of the brain that are lighting up, that are firing off, as when we’re thinking about things like food. The more it’s sort of instinctive aspects of our existence.
So when it comes to things like that then you tend to have a lot of either instinct or emotional aspects going on. So I think it’s that that makes it the probably more problematic than most things.
Martin: So our brains are very good at recognising danger and running away from sabre tooth tigers but not so good about deciding how much to put into our pension and what sort of protection.
Hayley: Yeah absolutely and it may even be that part of your brain is triggering that it’s the same part that’s responsible for saying, “Shall I run away from this sabre tooth tiger?” So there can be a lot of fear based stuff and anxiety around money that can hinder us in our planning. It can lead to, in some cases, a little bit of a hiding from the decisions because of that, because it’s something that does create anxiety. So you tend to go one way or the other often, it’s well I don’t want to look at that at all, or you might over plan and be very very tied up in detail and not allowing yourself maybe to spend anything. And it can often operate in many different ways according to your own unique experience with money over time.
So not everybody’s impacted the same, but there tend to be certain patterns that play up. And a lot of my coaching work that I do with people is actually identifying what particular aspects, what particular patterns, are kind of active for them. So in the same way that some people might be people who have a tendency to emotionally eat, for example. I say that because I do that when I’m … I eat chocolate when I’m stressed. So in the same way there could be certain people who are impacted in that kind of way, in a similar way around money, or there could be those who may get into a little bit of a over … The person who has to go for runs everyday and won’t eat anything bad or anything like that, both of those can be reactions. And if you think of money in a similar way to that, so a really useful thing would sometimes be to think about your relationship to feed, and it may actually reveal some things that you haven’t been aware of in relation to your relationship with money.
Martin: And you mentioned there’s a habitual side to this as well, so is that about the experiences that are formed in childhood? Do they influence our behaviour around money as well?
Hayley: Yeah I think the importance of our childhood shouldn’t really be underestimated because what happens when we’re children, with our adaptable human brains we’re doing a lot of our hard wiring around many things when we’re a child, and money is just one of those things. But it means that that’s where we are gonna be establishing our patterns and that then lead to habits in adulthood.
So it’s surprising, even experiences we might take for granted as being quite small like the first pocket money we received and how we received it. What our first experience was around the tooth fairy or Christmas and birthdays, how did those things operate in your life? Or were you given a lot of responsibility around money really quickly? Because sometimes that can be something that parents do because they think well we’re gonna get our children to be very conscious and evolved around money, but that can sometimes replace a little bit too much responsibility and it can be something that can result in a little bit of over responsibility in the future, which is something I came across recently.
So it is very unique to the individual as to what happens in your childhood, what were your early memories of money? And that can provide really useful key to understanding your own adult relationship to money.
Martin: So are there particular steps that parents can take to make sure our children hard wire the right brain chemistry, right brain functions, and make best decisions around money in the future?
Hayley: Yeah I think there’s certainly some things they can do. I think probably the primary, the first point, is to reflect on your own habits and behaviours, because all of us, even if we’re very very aware of this, are likely to be already setting those patterns in place. So if there’s anything you can do to just be aware of your own stuff, and then see what messages you’re giving to your children around money. So if it was the case that your parents always said, “Money doesn’t grow on trees you know.” Or, “I’m not made of money.” And all of these things, and then you find yourself repeating those things, then that’s a sign, that’s a pattern, and it’s thinking well what is this message that I’m giving here in relation to money?
So I think self reflection first. Then I think with specific things there are some … One probably useful tip I guess is to think about pocket money dynamics, because parents often tend to go between giving the child something just because they are them, or you have to earn your pocket money. And each of those … So both of them can come from a really really good place in terms of parenting, but both of those can create a pattern. So one, if it’s you give your child pocket money without needing any kind of input, it’s just for being them, then that could set up a tendency to believe that money just comes, money is just there regardless.
But equally if you set up the dynamic that you have to earn your pocket money, it can also result in a pattern where you feel that money always has to be earned, so you may really struggle with receiving money in terms of gifts, in terms of inheritances. I came across someone who could not receive an inheritance, as in it made them feel physically sick. They couldn’t bank the check, it felt horrendous, and it turned out … It was from a distant relative as opposed to a parent, and it turned out that they had been taught that money has to be earned. So it just felt completely wrong.
So I think a combination is a really good thing. So if you can set up something where someone can receive a certain amount for just existing, for being them, so it’s unconditional. And then you get another element which could be earned, which could be behaviour related, etc. But just so that it’s not all dependent on one particular aspect because that’s where it tends to … Even when it comes from a good place, can set up the potentially problematic thing for the future.
Martin: That’s a really good tip. It’s something I’ve not really considered before or heard of before. I think we’re gonna look at implementing that with our kids because that makes a lot of sense to me. If we do find ourselves in adult life and we’ve not necessarily had the best grounding when it comes to our relationship with money, are there any steps we can take to coach ourselves to improve that relationship?
Hayley: Yeah I think there are some pretty simple things you can do. I think everybody can … Just an exercise where you allow yourself to just think back, potentially just think back to your parents and what their own relationship to money was and how it was with you. And maybe just jot down a few thoughts, or anything like those phrases that tend to come up. And usually it’s the things that come to mind that are gonna be the things that might be relevant because it’s clearly something that is in your every day habits if it’s coming to mind when you think about it.
So what’s your first memory of money is a good one. And again, things like Christmases and birthdays, what have … Because often if you look at how you as an adult look at Christmas and birthdays, that’s probably something that you learnt in childhood. Because I don’t know if you ever found like if two people come together and get married or something like that and they have different dynamics over Christmas or birthdays, it can lead to difficulty. Almost like, “Oh you don’t love me because you haven’t bought me a really big present.” Or so on and so forth. So sometimes what we value is different, so it’s looking back at that and seeing how that’s impacted us.
And then maybe reflect, say, “Well what do I do now with money?” And a really simple thing could be well which of those supports where I am and which of those is problematic for me? And another really useful question is in what way does my current financial situation differ to when I was growing up? Because where we find the difficulty comes is when you have a different situation to when you were growing up, because it could be that all of the patterning you had isn’t relative for where you are today, so that’s where you can get conflict. So in the same way that if you grew up in Siberia and then you moved to the Mediterranean, and it could be that you are so hard wired for cold weather that there are things about your behaviours and how you are that just make you unseated.
So again, just think of the difference. So if you had a very comfortable upbringing and maybe not such a comfortable adulthood, that can create difficulties because you can still be in the mindset of your previous situation. So I think just really simple reflective things, just having a money journal even. Just keep a note and say what do I do, or when am I making decisions around money and what do they tend to be around, and what am I playing out? You can almost see yourself as a little bit of a project and start to get aware with it.
Martin: So being aware of some of these issues is obviously really important but what are the practical positive steps people can take to improve their relationship with money?
Hayley: Yeah that’s a good question, I think because awareness is one side behavioural change is generally the biggest challenge, because of the hard wiring, it often tends to be like any other kind of habits that you might have. Anyone that’s tried to give up something will understand that. So I think that’s when the coaching comes in in terms of having defined structure that you can rely on to create good habits. So one example of that might be that somebody who has a tendency towards emotional spending. So you’ve got the savings plan, you’re gonna save 300 quid a month, you’ve got it set up. But every time you have a bad day you go onto Amazon, you use the one click and before you know it you’ve moved all of your savings back from the e-saver into your current account because you’ve got to pay for your Amazon spend.
So that’s an example of where you have your intentions, but then the habits come to play. So making use of … And it is about finding the habit that works for you, because I think a very common one is to actually save first so that what you have in your account is what you have left for personal spending say. So you’ve already met your saving targets at the beginning of the month. Now that can work well if you are disciplined and if it’s in a place that you can’t get to it. But I know from my experience of working with clients that they’ll do that and they feel like it’s ticked the box, but if it hasn’t gone into a long term investment say, it’s very easy to take it back out again from a separate account and almost tell yourself you’re saving but you’re not really.
So I think it’s working out a habit that’s gonna work for you. So for some people … Again I just think of a really good example of this. If we come back to food, for some people it’s recording. So think of like MyFitnessPal or all those kind of apps where you record your food and it gives you signs that you’re doing well or it shames you if you’ve had a bad day by telling you how much you’ll weigh in a month’s time or so on and so forth. You could do that with money. If you work on the basis of almost a slap on the wrist if you haven’t met certain goals and you can arrange that.
The great thing now is that there’s lots of technology coming forth that allow you to do that and to keep this kind of disciplined nature around your money, so I think if that really suits those kind of things can work really well. But it’s not for everybody, because for some people it just feels like restriction, it feels negative, and it won’t work. So for those people it might be setting up a reward system. So say for example there was something that you love that you normally spend money on but you were gonna cut back so that you could meet your savings goals. You could choose to say, “Well I’ll still allow myself that treat.” So for me it might be a spa day or something like that. Well if I’ve made my savings target then I can treat myself. And of course it’s at a lower … and it’s less often, maybe all the time, at the three month point or so on and so forth. Then you can actually use a rewards system.
So sometimes it’s working with your behaviours, with your patterns, rather than against them. If that makes sense. Because you might think well I’ve got a bad habit over this or I worry too much about money, or whatever it might be, you might think right well that’s a bad habit, I’ve got to get rid of that, but sometimes it’s working within your hard wiring, finding a way to work within that that will help. So yeah I think it does depend on the individual but there’s lots out there that can help now.
Martin: And what could somebody expect from a first meeting with a money coach? I’m sort of imagining you come into your office and you get them to lie on your sofa and tell you about their parents and that sort of thing. Is it like a psychological evaluation or is it something different?
Hayley: It does sound a bit like that doesn’t it? And I think it does depend on the client, because it can be really useful to look back at the past but we don’t wanna get stuck there, because where we make changes is right now. So for some people, I mean I have come across people where the dynamics of growing up were very very complicated so we did want to spend some time.
So it is a little bit of explorative what do you remember? But it’s never at a level where you have to give your deep darkest secrets away or anything like that. I think it’s just having an awareness of that. So yeah so it depends on the angle, sometimes there is a … I go through an explorative process and then from that explorative process where you’ve identified what your main patterns are, then the client will then work out their own steps towards their own habits that they’re gonna be shifting. So the idea is that you choose a problematic behaviour and you shift it.
And the ones that are good, well you just say, “Well that’s great that you’ve got this savings habit from your father who always was very disciplined over money.” That’s great, you don’t want to change that necessarily, unless it’s taken to extreme so that the person’s just eating baked beans and not allowing themselves any joy or pleasure in life. And that, I have coached someone where that’s been the case. So yeah it is a little bit explorative and looking at the past but then it’s very much practical side of how you can go about making some changes that are actually gonna work for you as an individual.
Martin: Hayley, thank you so much for joining us today on Informed Choice Radio. Before you go, where can we find out a bit more about you and your work and how can we connect with you?
Hayley: So I work for Almary Green Investment. So AlmaryGreen.com gives information about me and a bit about money coaching. I also have a Twitter account which is @TheMoneySage.
Martin: Fab. We’ll make sure we put links in our show notes so people can find you nice and easily at the websites and on Twitter too. Thank you for your time.
Hayley: Thank you very much.
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