← A Better Way to Money
A Better Way to Money
Living Your Best Money Life
00:22:56
If the thought of managing your money has you feeling stressed, you're not alone. In this episode, best-selling author and entrepreneur Kate Northrup joins Jennifer to explore how to bring a sense of peace back into your money life. Kate shares how...
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Looking at our lives, specifically our relationship with time and energy through the lens of what matters, what doesn't. And ultimately our relationship with money is very intertwined with this very same thing.
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No matter where we are in our
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life, one thing is certain.
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Our relationship with money impacts every part of it. And yet many of us struggle to navigate that relationship in a way that supports our well being. Today I'm joined by Kate Northrup, an entrepreneur, coach and best selling author who helps people lighten their mental load and live in alignment with their values, financial and otherwise.
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Kate's work blends practical financial tactics with a deeper look at how our nervous
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system, emotions and beliefs influence how we feel about money. And remember, if you enjoyed today's episode, please leave us a rating and review. For more episodes and helpful guides, Visit us@northwesternmutual.com podcast all right, let's dig in. Okay, Kate, I am so excited to chat. Thanks so much for joining us today. First, can you just start like telling me a little bit about yourself?
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First of all, I'm so excited to be here. Thanks for having me. I've been in the personal finance healing your relationship with money field for over 20 years. And I stepped into this work because when my parents got divorced when I was in high school, my mom, who was 50 at the time, kind of made this vow that she was going to get financially literate. So even though she was a doctor, she was very successful, you know, just generational. She just had given all financial decisions to my dad, just kind of assuming because he was a man, he, he would know better. And at the age of 50 she was like, I better get it together because I'm here on my own now. And I was 16 and for whatever reason I just had this insatiable appetite for learning about money. And despite trying all these different ways to get it together financially, I just could not get myself to essentially lean in and become a full financial adult because all of the money advice I was following from, from what was available in the personal finance world at that time was it felt very shame based.
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So what does wellness mean to you?
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Like when we're talking about money, level of stress directly impacts our well being. What we know is that at the root of nearly every single disease that is bringing our health care system to its knees really is stress. And we also know that money is the number one leading cause of stress or at least in the top five. And so when it comes to wellness, our relationship with money needs to be at the forefront. Honestly, like wellness can be expensive and so we can't separate our money from our well being because every single day for the rest of our lives, we are going to be interacting with money. And for most people, those interactions come with fear, stress, anxiety, contraction, you know, a feeling of pressure. But what if every single re interaction with money could come with a sense of abundance and joy and consciousness and agency and help us to feel more of ourselves as opposed to less of ourselves?
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So how do we do that? How do we get it to where. Yeah, where we're feeling that way?
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We want to change our results when it comes to money, whether it's that we want to have a higher income, we want to be better at saving, we want to have our retirement covered, we want to be able to go on vacations, we want to become investors, we want to feel safe and secure. How do you want to feel with money? I want to feel safe, secure and free. So we think, oh, a number in the bank is going to get me that feeling. Because our nervous system is wired for survival. We are animals. It does not want us to experience anything new. It only wants us to experience that which we've experienced before. Which is tricky when every single one of our financial goals requires us to experience something new. So many of us are stuck in that cycle. Earning, spending, stressing, and thinking more money will solve the stress.
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Next, Kate will reveal how you can break that cycle and unlock your version of financial wellness. Before we dive back in, let's briefly hear from Northwestern Mutual on how planning can help.
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Financial wellness is a crucial part of your overall well being, but it's often overlooked. In fact, research from EY and Dr. Hal Hirschfeld has shown that following a comprehensive financial plan can lead to better outcomes for you, financially and emotionally. The first step in creating your plan should be a deep, meaningful conversation with your advisor. This is where they really get to know you, your values, and your goals. These kinds of conversations can help uncover blind spots and opportunities you might not have seen on your own so you can work together to grow and protect your money, making it easier to achieve your goals. If you want to learn more about comprehensive planning and how it can boost your financial wellness, visit northwesternmutual.com podcast and download our A Better Way to Money ebook. Then reach out to your advisor to get started.
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Okay, Kate, your most recent book, Do Less, talks about your Do Less philosophy. Can you break down what that's all about?
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So Do Less was my second book, and Do Less is really looking at our lives, specifically our relationship with time and energy, through the lens of what matters, what doesn't and ultimately our relationship with money is very intertwined with this very same thing. Money is designed for us to align our lives with what really matters to us, right? Like currency. The money system is pretend. It was invented by humans to be able to trade value for value. That which I find valuable with that which you find valuable. Fundamentally that's like a deeply emotional process and it's actually pretty unique. That which each of us finds valuable or thinks that matter is unique. But we are so conditioned by media, culture, family, you know, friends, whatever, to get disconnected from what really matters in our lives. And so we overwork, we overspend, we get lifestyle inflation, and we end up living these lives in terms of our work, our time, what we think about, what we put our attention on and what we spend our money on that are completely disconnected from who we actually are on a soul level. And so the do less philosophy is really about, okay, how can I take my actual most precious asset, which is my time? It is non renewable, right? Like we only get what we get. How can I actually reorganize myself so that I'm able to invest my time and energy in what matters and, and reap the rewards of that as opposed to being stuck in this unconscious programming which says if I do more, I will be more valuable.
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Not everyone has the same definition, maybe of what success looks like. I mean, maybe we've all kind of been programmed to have the same definition. But I like how you're talking about it doesn't have to be that way. So how do you define like financial success outside of the norms of traditional wealth?
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Designing your life so that you are experiencing that which makes you come alive and that requires investing your money and planning in such a way that it protects the things that matter to you, whether those are your assets, whether, whether that's your time. You know, I'm a business owner, so I think a lot about, yeah, are there a million different ways that I could make money in my business? For sure. And you know what? Only a very small percentage of them is actually something I'm going to do because my freedom and having very little on my calendar is actually my number one priority. That to me is financial success. And people might say, oh well, you're leaving money, money on the table. And I'm like, I don't care was my time is mine.
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How can listeners start to identify the ways that their like, financial habits could be actually harming their well being?
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Oh, love this question. So much so I cannot even tell you. So right now I have a Student body of a thousand people inside my. Relax. Money. Student. Student body. And so while it's certainly not like, you know, a statistical model, it is a cross section of humanity. We are, you know, we're a global. We're a global program, or at least it's a cross section of people who invest in online programs who have an Internet connection. And so what I'm finding, we're doing something right now called the expense edit. And what I'm finding is that most people actually are not aware of where their money is going, or if they are aware of where it's going, they're not aware of the totals. So what I'm hearing from folks, because our goal for everyone right at the outset is, is to find a way to save a minimum of $300 a month, right? So it's like, okay, how can we just reclaim $300 a month? Because immediately that gives us a sense of agency. And I have a process that I take people through because one of the things that causes depression is a feeling of victimization, a feeling of I don't have control over my life. Same thing with anxiety, right? A feeling of life is being done to me and I have no choice of about it. So the sooner we can put ourselves in a feeling of taking our personal power back, the better. And so where we start is like, okay, cool, let's look at your subscriptions. Let's just look at what are your automated charges. And people are finding like, oh, my gosh, I've been spending. I've been paying for this thing for three years monthly that I didn't even notice because it's automatic. I'm not paying attention. Because when we are. So here's back to the nervous system. People think like, oh, I'm just not disciplined, or I'm just not good with money, or I'm not a numbers person, or my husband does that, or like, oh, I just don't want to log in.
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Right?
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All of that. All of those things is simply your nervous system wanting to make sure you don't pay conscious attention to your money. Because if you don't pay conscious attention to your money, that will ensure that you stay below a certain amount of wealth and expansion, which doesn't feel good, but it feels safe and familiar. And so what we do is really start by building small bits of consciousness. And people are realizing, oh, wow, when I log in and I pay attention here, I'm realizing I have all these subscriptions. Like, I just, you know, I bought them on Apple pay, and now I, you Know, it's just getting automated and you think like, oh, 9 99amonth, like whatever, that's not going to make a difference. You know what it really does when you have five things at 9.99amonth and then when you do the totals, you realize, oh, what else could I do with that money? Oh, I could invest it in the stock market and get an 8% return on average, year over year. Or I could, you know, put it in my kids college. 5 21, 5 29.
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Yeah, yeah, yeah, yeah, yeah, yeah, whatever.
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And so it's starting to see our spending choices as an extension of our personal power and reclaiming it so that we're making those conscious choices, not so that it's like, oh, you have to spend as little money as possible. Because I'm really not about deprivation. But the truth is when we spend in alignment with what we truly value, what really matters to us, we don't feel deprived. We actually feel incredibly abundant. And for most people, they find they can spend less money and actually be getting more out of life because they're spending on what matters to them. Not like trying to keep up with their neighbors, with whatever car, how their house looks like. No one cares what you have, no one cares about your belongings, no one cares, no one notices. Doesn't matter.
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What do you feel like the importance is of having a plan or like goals in place to create a sense of money wellness.
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So the way I think about it is that money is like water, right? So we have the, we have abundance and it will flow however it's. If we want like a river to flow well, we need a strong riverbank that's not eroded. That's not like, you know, that, that has that nice boundary. So I love thinking about financial systems, financial plans, goals as the, the beautiful strong boundary of a river which allows the water to flow in a clear direction and actually helps to increase the speed of the water flow itself. And so that's where having a strong financial system, having a strong financial plan comes into place. And when we have a great plan, when we have goals, when we have a system, it actually vastly reduces the amount of mental bandwidth that money takes up. We, we actually have to think about it far less when we have a good plan and system in place.
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I love that river bank analogy. That makes so much sense because I think you're right that sometimes we get scared of like, ooh, I'm gonna look at my bank account and then I'm gonna start feeling like this sense of lack versus the sense of Abundance and, you know, thinking that ignoring it is gonna help with that and just thinking of the positive, but actually having a plan gives you that structure. So that, yes, that's just the perfect analogy so it can flow towards you. I really like that. So what does holistic planning mean to you?
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A holistic financial plan is really about the soul searching of asking, who am I like? And also, who was I before the world told me who I was supposed to be, what makes me come alive? And then matching our financial plans to that. I, you know, I was just reading about a couple who decided to retire early and they decided to live on very little and live in the mountains so that they can, you know, be outside every day and they organize their whole life about that. I think we really need to encourage people to look less at, like, what am I supposed to do? And, and this comes up again in my work all the time. People really want me to tell them and I'm like, no, I. Yeah, of course I can give you guidelines. I will give you questions to ask yourself, but I cannot tell you because I am not in your heart.
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Okay, you've talked about REST being a money strategy too. Why? How is that a strategy?
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Well, one of the things that we know is that when we are constantly going and paying attention to every ping and every request and all the notifications and the social media and the news, I'm constantly listening to a podcast and like running from thing to thing, we cannot tap in to our intuition that is such an important wealth strategy. Because the things that are going to move the needle the most for us, whether it's an investment strategy, a way we can save a bunch of money, something creative for our business or our career or some other insight is going to come in the same. Still small moments when you turn off the noise, when we do too much too fast, too soon, it actually has negative implications. It actually doubles down on that neural patterning of fear and contraction versus just small opening where it's like, okay, it's safe for me to sit here for a minute until the water boils.
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So that is what I think a lot of people feel is like, you know, going from thing to thing and being busy. Do you have advice for someone who maybe feels like they're burnt out trying to do it all? You know, maybe not in the moment, like, okay, listening, going from thing to thing to thing, like a lot of us are, but maybe in life in general, like career, family, finances, self care. Like, what advice would you give to someone who's feeling that, oh, it's so real.
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And there's, you know, it depends, right? Like if you have children, first of all, that's just exhausting. So, you know, I, like, sometimes I just have to listen. It's, it's, it's rough out there. I have a seven year old, a nine year old, it's definitely gotten a lot easier. But so I, you know, I always say like, look at what actually is the mental load that you are carrying and is there. I love to talk about asking for help and, and not only asking for help, but passing on ownership of parts of that mental load to others. I really like to work with people. It's like, let's reconfigure what you already have without anything needing to change externally. And then certainly we can change things externally, but most people can get huge results with some reorganization of their existing plate. But with money and time, is there
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another small shift that you think listeners can do today to just invite more calm, clarity and maybe intention to their money life?
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So one of the things that I love recommending as a starting place is to when you check your bank account balance, do it after calling to mind some things that you're grateful for and allowing yourself to feel the feeling of gratitude for what's already abundant in your life. So for example, when I was in a lot of credit card debt, I was also frequently going into overdraft on my checking account and I was so avoidant I just never opened it because somehow I thought that like, somehow if I didn't look at it, it would fix itself. So what I would do because I was like, okay, what we put our attention on grows. So I want to put loving attention on this. However, I felt scared. So what I did is each morning I would look around my apartment and I would maybe see like, oh, that house plan is doing really well, or I have leftover pad Thai in my fridge that I'm excited to eat for dinner later or whatever. Like it doesn't have to be complicated, right? And then I would go look at my bank account balance while I was already grounded in the reality that abundance is available to me right now. Like I am okay right now. And then, you know, if I was in the red, if it was whatever, I wouldn't then create this whole fear response in my body that would then create fear based behavior all day, which then of course creates a result that creates more fear.
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Oh, that's a good, I love that tangible tip. That's good. Get yourself grounded in gratitude before you open up your bank account. And then whatever you're going to feel there. At least you started from a grounded point and that can help you manage that. All right, one more what's one thing that everyone should take off their to do list today?
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Our tendency to worry is a nervous system based pattern. So if we can learn to heal our nervous systems and have some practices in place to get us out of the mental loops and you know, one of the most simple ones is to take a three minute walk around the block that will reset your nervous system so that you can actually realize so that your body can catch up to the fact there is not an impending threat present. Right now, actually I'm completely safe and it immediately frees up your mental bandwidth to be more present, more proactive, more creative, more resourceful. And yeah, so just anytime you're worrying, you need a nervous system reset. Great.
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I love that. So many good, tangible tips. Thank you so much. Kate, was there anything else that you wanted to add that I didn't ask you?
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I will just say as a final word, there is not one person who was on the planet who was born being good with money. It is a skill set that absolutely anyone can learn. And if you can learn to do like third, fourth grade math, you can be good with money. And it's just time to get engaged with it because it actually also can be really fun.
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It was such a pleasure to talk to Kate. Her experience is proof that financial wellness isn't about chasing someone else's version of success, it's about creating one that actually fits you. If you're ready to align your finances with your values, your financial advisor can
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help you get there.
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Head to northwesternmutual.com podcast to download our free ebook on the power of planning and start your own path to clarity and confidence.
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Northwestern Mutual is the marketing name for the Northwestern Mutual Life Insurance Co. NM and its subsidiaries in Milwaukee, Wisconsin. Not all Northwestern Mutual representatives are advisors. Only those representatives with advisor in their title or who otherwise disclose their status as an advisor of Northwestern Mutual Wealth Management Company are credentialed as NMWMC representatives to provide advisory services. Kate Northrop is not affiliated with Northwestern Mutual and the views expressed by Kate Northrop do not necessarily represent those of Northwestern Mutual or its subsidiaries. Research mentioned comes from The Northwestern Mutual 2025 planning in progress study.