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Money and Shame

shame can crush you

❝The difference between shame and guilt is the difference between 'I am bad' and 'I did something bad.'❞ -Brené Brown

A little boy is at school laughing with some friends. He has pretty good relationships at school. He's funny and can make people laugh. School comes easy to him, so he's able to help people with their homework. He's pretty fast and good at sports, so he likes to be active with others. He draws pretty well and likes to learn from others who share his hobby of drawing comic book characters.

When he leaves school, though, he is mostly a loner. There are a couple of kids in the neighborhood that he hangs out with, but he never hangs out with kids from school. While in school, he would overhear others talking about sleeping over at each other's houses. He is never invited over to anybody's house. The flipside, though, is that he never invites people over to his place.

It seems to him that all of the kids at school live in large houses in fancy areas of town that have fancy names. The story he tells himself is that when kids stay over at each other's houses, there stay up all night in large basements playing Nintendo and drinking RC cola. He doesn't have a large basement, nor a Nintendo, nor a house.

He doesn’t invite people over because he is ashamed. He wonders what would happen if they said no. He wonders what they will tell all the other kids when they find out he lives in an apartment and not a giant house. What would they think of him if they find out he has no Nintendo and no RC cola?

Shame kept this little boy from having more friends than he did. He wrapped himself in a shame bubble.

I know that little boy well because that boy is me.

stay out of the shame bubble


According to Karen Reivich and Andrew Shatte in their book The Resilience Factor, shame is related to beliefs about being a bad person. It's about character rather than behavior. People who are ashamed tend to be people who view themselves as being flawed or defective. In addition, they think that it's their fault.

Shame is toxic and, to the extent we have any control over it, ought to be avoided at all costs. It causes helplessness and powerlessness and gives people an external locus of control, making them think that their lives are outside of their control. It tends to get people into a downward spiral that's hard to get out of.

the shame cycle is hard to get out of


Shame is a close relative of guilt. Both shame and guilt have to do with people wishing that something was different. Often they wish there was something that they could change in the past. The difference, though, is that guilt is about a specific behavior. Somebody who feels guilt feels like they have done a bad thing. Shame is about being a bad person.

Both of them are uncomfortable, but guilt is easier to rectify. Guilt points us to something that we can do. Guilt tells us there's somebody we can apologize to or something we can stop doing. Shame doesn't have a specific behavior attached to it. If you don't have a specific behavior attached to it, you don't know how to rectify it as easily.

shame is worse than guilt


Guilt and shame are often used interchangeably. If you're feeling uncomfortable feelings and think it's shame, it might be worth trying to see if you can find some guilt. Guilt is better for you. Guilt will give you a problem to solve; a challenge that you can try to overcome.

stay away from shame by trying to find guilt


Often people feel ashamed or embarrassed because they see themselves as a failure at a deep level. These feelings are often driven by automatic thoughts, or Money Scripts. Our automatic thoughts are almost always going to skew negative, and that's because of our ingrained negativity bias. It takes work to overcome this negativity bias, but it starts with trying to get a handle on what story you're telling yourself. In other words, what Money Scripts are driving the thoughts about shame? Once you know what your actual belief is, you can challenge those beliefs and those automatic thoughts. You can ask yourself if you're overgeneralizing, for example, or catastrophizing. Sometimes it's difficult to challenge beliefs when they are ours, so you can ask yourself what advice you would give a close friend if that person came to you with the exact same situation.

challenge automatic thoughts


It's helpful to remember that you can't change anything that's happened in the past. The only thing you can do is learn from it. It's also reassuring to learn that many things are outside of our control. For example, you can't change the cards you were dealt in life; that is outside your control. What is in your control is how you play the hand; you can change what you do going forward.

focus on what you can control

Shame is dangerous. Once we get into a shame cycle, it's hard to get out of. It's helpful to try to reframe our shame as guilt if at all possible. If we can point to a specific behavior or set of behaviors that we've done, then we can do something to rectify what we've done. Shame is often driven by automatic beliefs that are tilted towards the negative side. Learning to understand and challenge these automatic beliefs will help us determine if we are jumping to the wrong conclusions. Finally, remember that some things are in your control on some things or not. Take responsibility for those things that are in your control and let go of things that are not. You can't change the past, but you can do something today and tomorrow to alter your future.

What will you do?

You only have one life; live intentionally.

With gratitude,


If you know someone else who would benefit from reading this, please share it with them. Spread the word, if you think there's a word to spread.

Related Money Health® Reading
References and Influences

Feldman Barrett, Lisa: How Emotions Are Made

Hanson, Rick: Hardwiring Happiness

Klontz, Horwitz & Klontz: Money Mammoth

McCall, Karen: Financial Recovery

Newcomb, Sarah: Loaded

Reivich, Karen & Andrew Shatte: The Resilience Factor

Note: Above is a list of references that I intentionally looked at while writing this post. It is not meant to be a definitive list of everything that influenced by thinking and writing. It's very likely that I left something out. If you notice something that you think I left out, please let me know; I will be happy to update the list.



About the Author

Derek Hagen, CFA, CFP, FBS, CFT-I, CIPM is a speaker, writer, and coach specializing in financial psychology, meaning and valued living, resilience, and mindfulness.


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