Social media is abuzz with conversations about breaking “generational curses,” or healing from generations of trauma.

Part of healing from generations of trauma is changing how we relate to money.

What’s generational trauma?

Generational trauma, also known as intergenerational trauma, refers to emotions and behaviors that are linked to negative or even frightening events. According to the American Psychological Association (APA),

Generational trauma can have devastating effects on individuals, families, and communities. These effects can impact every aspect of our lives, even finances.

What’s generational financial trauma?

You may feel ashamed of money or have a negative attitude towards money. This could be a sign that you are suffering from financial trauma. Chloe B. McKenzie is the founder of Center for Financial Trauma & Wealth Justice. She defined financial trauma as the “response to the cumulative harming of a person’s wealth-building capacity and relationship with money.”

Rahkim Sabree stated in an email that “Generational Trauma is undoubtedly the greatest impact on our relationship with finances.” Sabree, a certified financial educator and author of “Financially Imresponsible,” said Rahkim Sabree in an email.

Generational trauma surrounding money can also be caused by societal or systemic factors. According to the APA, trauma can be passed down through experiences such as poverty and racial discrimination.

Sabree stated that financial trauma can include financial overlap due to divorce or child support orders or inability to take part in scholastic and athletic programs due to lack of funds or any experience that results from navigating poverty. I often refer to boiling water for bathing, or the embarrassment that comes with having your food stamps card (SNAP), decline after you have loaded a shopping cart onto the supermarket conveyor belt.

Who is impacted by financial trauma generational?

Generative financial trauma can happen to anyone, but certain groups are more likely to be affected. According to the U.S. Administration for Children & Families, LGBTQ+ people, Indigenous people, and other people of color have suffered historical trauma.

The legacy of wealth inequality can still be felt today:

  • According to data from the Board of Governors of the Federal Reserve System, the average Black or Hispanic household earns about half the income of the average white household.

  • Members of the LGBTQ+ community face higher rates of workplace discrimination than their cisgender/heterosexual peers, which leaves them earning less and impacting their ability to manage expenses, build savings and buy homes, according to the Center for LGBTQ Economic Advancement & Research.

  • Black women earn an average of 64 cents for every dollar earned by white non-Hispanic men, according to U.S. Bureau of Labor Statistics 2021 data.

People with disposable income or wealth can also be affected by financial trauma.

“Money trauma affects everyone, even those with perceived wealth,” Sabree stated.

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How financial trauma of generational origin can affect you and your finances

Financial trauma can affect how we feel about money and talk about it, according to Aja Evans (a licensed mental health counselor) and a financial therapist.

Evans states that the way we talk about wealth has an impact on how children learn and understand money. This can then be seen in how they deal with money in adulthood.

Some of the possible effects of financial trauma generational may include:

  • Overworking in an effort to improve your financial situation.

  • Avoiding taking stock of your finances and overspending because money can bring up negative emotions .

  • Being too frugal.

Your overall well-being can also be affected by financial trauma. Evans has witnessed this in her own work. One example is helping clients to overcome unhealthy eating habits.

How do you heal?

If the world were perfect, people who have suffered from historical trauma would be more supported in their financial wellness journeys. Sabree hopes to see systemic changes that promote diversity, equity, and inclusion in corporations as well as real reparations for Black Americans.

Financial trauma is difficult to overcome and there are no quick solutions. Throughout your healing journey, practice self-compassion.

These are some ways to get started.

Recognize how you feel about money

Avoidance is a sign of financial trauma. It’s important to face your feelings about money. Begin by acknowledging any painful emotions or past experiences in relation to money.

Allow yourself to feel these feelings. Evans suggests that if you feel overwhelmed, it is a good time to seek help and guidance to begin the process.

Financial therapists use behavioral therapy and financial coaching in order to change your attitude about money.

Set boundaries

Understanding how to set financial boundaries can help you have a better relationship to money.

“Remember how you feel when your boundaries are stretched — that is why it is happening, Evans says. This will help you to feel positive about your financial decisions and avoid feeling negative.”

Money boundaries might look like:

  • Budgeting and planning.

  • Telling someone not to ask for money.

  • Offer to pay a loved one’s expenses directly instead of cash.


It’s not necessary to deal with financial trauma from your past generations alone. You can seek out support from a financial coach, a mental health professional or people in your community who are familiar with your situation.

Support can help with difficult emotions, make you more aware of your money relationship and hold you accountable. Get support from professionals who are familiar with your financial situation.

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