By Anne-Marie Ferguson

In the article entitled Life-Long Financial Planning, one of the recommendations was to “Treat your family finances like a garden.” The metaphor speaks for itself: tend to and cultivate your finances. Unfortunately, many of us function in another way when dealing with our finances: namely, money fog.

What is money fog? Having no idea about your real bank balance, how much money you owe, or where your money is being spent are some of the symptoms. Then there are those pesky overdraft fees, wondering where all the ATM cash you withdrew yesterday went, credit cards with ever-rising minimum payments, dreading the arrival of statements, juggling money around in order to pay the bills, loan consolidations, and a cycle of getting out of and going back into debt, always with the resolve to not repeat the cycle. Those are just some of the signs that one is very foggy about one’s money.

Being in a money fog offers short-term false comfort. If you don’t know where you stand with your money, then you don’t have to face up to whatever the truth is. “Everything will work out,” “Someone [or something] will help me out, as always before,” “It’s only money,” or the best one “Maybe I’ll win the lottery.”

Sadly, underneath such magical thinking is an ever-present, free-floating anxiety. Paradoxically, money fog causes one to spend more time on money issues than those who are in control of their money. Ongoing financial stress inevitably flows over to other parts of our lives: personal and work relationships, careers and health.

Clearing away the money fog can be uncomfortable, because it involves looking honestly at our financial behaviors, and examining one’s overall relationship and history with money. We have a relationship with money from the time we are very young (think: Tooth Fairy) to the end or near-end of our lives. However, unlike other relationships in our lives, we rarely focus on our relationship with money. What role does it play in our lives, what messages did our parents give us about money, if any, what emotions come up when talking about money, why do we overspend, spend compulsively, or, in the reverse, deprive ourselves of needed items?

For many, shame and embarrassment surface, because money, for all that it pervades our culture, is rarely discussed on a personal level, and, in fact, is studiously avoided. You probably have friends who have shared intimate details of their lives, but who wouldn’t dream of talking to you in specific terms about their financial situation, and vice versa. Couples know only too well what a “third rail” their money discussions can be. Then, there are the difficult money talks with siblings and aging parents.

If any of this resonates with you, emerging from the money fog is like all lifestyle changes – one step at a time. Start by picking one action you can take, and then when that becomes second nature, move onto the next one. Don’t overwhelm yourself, as you’ll become discouraged and stop.

  • Reconcile your banking transactions. If reconciling your bank balance is daunting, there are clear, simple instructions available on the web. Here’s one: Get in the habit of frequently reconciling. In the beginning, daily is a good idea (and much easier) but monthly is essential. It is the first step to being connected with your money.
  • Itemize your credit cards, balances, and interest rates. You may not like what you learn, but it’s only by facing the issue that you can take action.
  • Start tracking. Now, this is the step where you will feel the most resistance, but is a very important one in order to get your arms around your money. Tracking involves keeping a written or digital record of all your expenses, whether with cash, debit or credit card, or the often-overlooked automatic debits from your account. It could be that early-morning coffee at Starbucks (start asking for a receipt), lunch with friends, the sweater on sale, or the groceries/take-out you pick up on your way home.
  • Review your expenditures. Once you’ve started tracking (and discover it’s not that difficult), then it’s time to begin categorizing your expenses. The results can be very revealing: “Ok, how much did I spend on groceries this month?” “How often did we eat out this month,” and so on. Those who are familiar with creating a spreadsheet will find it to be an excellent tool, but it’s not necessary. Paper, pen and an old-fashioned calculator will serve the same purpose.
  • Build a spending plan. Once you have two to three months of record-keeping under your belt, then you will be able to create a spending plan for the upcoming month. A spending plan takes into account your expected monthly income and your past months’ spending patterns, giving you the information to create a plan (not a rigid budget) for how you wish to live your next month, always with the ultimate goal of spending within your means. Why a spending plan? Well, otherwise, you are merely looking in the rear view mirror, when looking at your spending. This way, you are making decisions and choices in advance. A spending plan can be flexible. If you spend more than you planned for on, say, an unexpected wedding gift, then you can go into your plan and make an adjustment elsewhere, so as to stay within the plan.

Emerging from the money fog is a process, a journey. It takes time. However, gradually, you will “notice what you notice.” You will observe aspects of your financial behaviors that you may decide to change. It could be that you are spending money on activities or objects that are not enhancing your life, or are gobbling up your time. You may be bemoaning never having money to take a vacation, but you’ll notice that if you did away with such and such expense, you could be saving for that vacation. You will start thinking more about “Do I really need this, or do I just want it?” “How does this fit into my spending plan?” “If I buy this, then will I need to cut back on our vacation savings?” And…seeing how much you pay in debt service will be very enlightening, and lead you to thinking not only about a debt reduction plan, but casting credit cards out of your life for good.

All of the above leads you down the path to being consciously connected to your money, to clarity and to throwing off the money fog. Human nature being what it is, there will be some “relapses,” and you will need to be kind to yourself about those, but you will see progress if you persist.

On your journey, you also may decide to become more educated about money management. Your Money or Your Life by Joe Domingues and Vicki Robin is still one of the foremost money books out there. A newer version has recently been published. I am happy to send you a list of other recommended readings.

Also, there are now numerous money management blogs. My favorite is The Simple Dollar, written by a young man in Iowa who has chronicled his journey out of debt to a better way of life for him and his family. You can find him at Check out Trent’s 14 Money Rules on his sidebar.

Gaining clarity around your money has so many benefits. You will be under less stress – and not experience the money/life drain that you will begin to notice in others, as you improve your own relationship to money.
Your relationships and your health (certainly your sleep) will improve. It will so be worth the effort. Or, as one of my colleagues, Mikelann Valterra, puts it – it’s the Key to Life. For really, once you have peace around money, many other aspects of your life will fall into place.


Anne Marie Ferguson, a resident of North Vancouver, is a financial counselor, trained and certified by the Financial Recovery Institute, where she now serves as a faculty member. ( Anne Marie welcomes confidential inquiries from individuals and small business owners who seek professional guidance towards financial clarity. She works with clients by phone or in person. Reach Anne Marie at 604-971-2008 or (