Our relationship with money can be a difficult one to manage. Even though most of us try to save, we tend to spend more than we really need to, even when it may defy logic. Money habits like these can often be overlooked, but what are the driving forces behind our decisions to spend or save?

Ted Klontz, PhD, associate professor of practice at Creighton University’s Heider College of Business, has been studying that question through the cutting-edge field of financial psychology.

Klontz describes financial psychology as “bridging the gap between what we know we should be doing financially—like saving money and investing for the future—and our behavior, which is often quite different than that.”

To understand this gap, it’s key to look at people’s decision-making processes regarding money. Many financial decisions are made subconsciously under the heavy influence of money scripts, or deep-seated beliefs about money that influence spending. Even though we may not be consciously aware of these scripts, your brain is still likely making decisions based on them.

Dr. Klontz uses the example of a well-known nursery rhyme to explain the concept.

“Hush, little baby, don’t say a word
Mama’s gonna buy you a mockingbird.
And if that mockingbird don’t sing,
Mama’s gonna buy you a diamond ring.”

“So, at the age of three [my granddaughter] is getting indoctrinated into: if you’re not feeling good, buy something,” Klontz said. “And keep buying something ‘til you find something that works.”

This money script is relevant in adult situations as well. When you think “retail therapy” is the cure for sadness or overcoming disappointment, it may be your nursery rhyme money script influencing you.

Klontz says that once individuals are aware of their money scripts, it can help them identify bad spending habits and find ways to correct them. For example, once an individual knows that they primarily go shopping to cope with sadness, they can brainstorm other activities to do instead.

Money scripts are one of the many subjects studied under financial psychology and Klontz believes the field is still growing.

“We are now beginning to own financial psychology, discover it, and use it for our own benefit with some wisdom around it,” he said. “As we begin to unwrap this and uncover this again, we can help people live more efficiently more effectively and more safely.”

Understanding financial psychology is the key to giving any financial professional an edge in the industry. The subject gives professionals countless tools and skills that will allow them to better understand their clients as well as the industry.

Get ahead of the financial psychology boom today with a graduate certificate in Financial Psychology and Behavioral Finance from Creighton University. Not ready for the commitment of the graduate certificate program? Creighton is now accepting students for “Applied Behavioral Finance,” an eight-week online course offered in October through our Center for Professional and Corporate Excellence.