Why Money Matters Are So Challenging for You

Image . . . and What You Can Do About It

by Russell A. Barkley, PhD, with Christine M. Benton

Adapted from Taking Charge of Adult ADHD by Russell A. Barkley, PhD. Copyright © 2010 by the Guilford Press. Reprinted with permission of Guilford Press, www.guilfordpress.com.

YOU DON'T PLAN TO END UP in financial trouble. You may, in fact, keep resolving not to go shopping today and not to buy anything advertised in an Internet pop-up. You might tell yourself today is the day to transfer some money from checking to savings. Maybe you tell yourself while you're at it you might as well see if you have any bills that are due.

So why don't you follow through on those convictions? Because ADHD won't let you. It's time to take charge—of your ADHD and your finances. Start by bringing into crisp focus how the deficits caused by ADHD steer you wrong—and how you can steer yourself back in the right direction.

Adults with ADHD and Money 

Our research has found that adults with ADHD:
 Image Made a lot of impulse purchases.
 Image Had high credit card balances.
 Image Exceeded their credit limits more than others.
 Image Made bill, loan, and rent payments late or not at all.
 Image Had their cars repossessed more often than others.
 Image Had lower credit ratings.
 Image Were more likely to have no savings.
 Image Were less likely to save for retirement.
 Image Bounced checks more often than others.
 Image Often failed to save receipts that could document money-saving
tax deductions and other documents for their income tax returns.
 Image Lost friends after borrowing money and not repaying it.

The Four Executive Functions that Foster Self-Control

Scientists in the field of neuropsychology call the capacities behind self-control executive functions. They’re the actions directed at ourselves, the mental activities we engage in when we think about our future and what we should be doing to get there and to make it better. Many adults with ADHD exhibit delayed development of each of these four executive functions.
 Image nonverbal working memory (using the mind’s eye)
 Image verbal working memory (using the mind’s voice)
 Image self-regulation of emotion (using the mind’s heart)
 Image planning and problem-solving (using the mind’s playground)

Money and the mind's eye

Impulsive shopping can become compulsive shopping when your nonverbal working memory is weak. You can't picture what happened the last time you bought an expensive item you didn't need. You can't bring the future into sharp enough relief to put off the purchase till you've saved the cash. You haven't developed the self-awareness to realize that walking into an antique store for you is like opening the gates of hell. The mind's eye is particularly important in controlling the impulse to buy things you don't need or can't afford.

Try to resist spending money by keeping a photo of a long-term goal (a vacation spot, a home, a bike for one of your kids, etc.) in your pocket to pull out whenever you feel the urge to buy. You might train yourself to say out loud before you pull out your wallet, "Hmmmmmmm, do I really need this?" Then you could turn on your imaginary wide-screen TV and watch a film of yourself opening your credit card bill last time you overspent.

Your finances and the mind's voice

Remember, the mind's voice is your backup when the mind's eye is myopic. If you find yourself feeling the urge to pull out your credit card and you really can't call up a visual picture of what happened last time you overspent, interview yourself. If you're in a store, leave and do this on the sidewalk. You won't get hauled away for being delusional; people will just think you're on your cell phone when you talk to yourself about whether this purchase or withdrawal is wise.

If you tend to put off bill paying even when you've set an alarm to remind you to do it, this is another time you can talk to yourself about why you need to do it right now. The mind's voice is also the facility that allows you to formulate and use rules. Set certain rules about spending and saving and then repeat those rules to yourself quietly when under pressure from your ADHD to break them. Or write them down on a card you keep banded together with your credit card so you can't access the credit card without the rules card.

The mind's heart in the world of money

Are you an emotional spender? Are you the person who always buys a round of drinks at the pub when you're feeling great? The one who "needs" a new outfit when down? If you're mad at your landlord, do you "show him" by "forgetting" to pay the rent? Does not having cash to go out with friends make you feel so bad that you decide to put the charges on your credit card?

You're going to have to pull out your whole bag of mental imagery and self-talk tricks to recognize when your emotions are carrying you away and how to get control. Also, try to stick to a healthy lifestyle. Sleep deprivation, overconsumption of caffeine or alcohol, drug use, lack of exercise, and poor diet can all make you more vulnerable to daily stress and make it harder to control your emotions.

Don't forget that you can use your emotions for good, too. Hate bill paying? Feel the future: Do everything you can to feel the relief of getting it done. Can't motivate yourself to put money in savings when your paycheck is burning a hole in your pocket? Feel how great it will be to take it out when you pay for your Caribbean vacation.

Financial planning and problem-solving in the mind's playground

For many adults, ADHD or no ADHD, money matters are for "bean counters" and "number crunchers," which is usually a not-so-nice way of saying "I don't know how"—how to do financial planning, how to budget, how to oversee your investments, how to stop getting hit with late fees and hassled by collection agencies.

Make money management physical. Use tangible objects and graphic tools to manipulate the numbers whenever possible. The last section of this article and the “Curbing Your Spending” sidebar will give you some ideas. But remember the basics too: Make lists of steps to complete financial tasks you find daunting. Record your spending habits in your journal so you can take a look back at the patterns that are hurting you and any that are serving you well.

Fortunately, you've got a lot of resources at your fingertips for taking back control of your financial present and future. There are many strategies for discouraging spending. Tools and cues can help you meet your financial obligations on time. You can set up systems that enforce saving so you don't have to fight the urge to spend everything you earn over and over.

A new approach to money management

Here are a few ideas for getting started on a better path:

 Image Let your spouse, partner, or even parent manage your money. This option is something to consider if you feel overwhelmed by the problems you're having and find it impossible to control your spending or other financial habits. You can always agree to do this for a preset temporary time period or until a certain goal—such as paying off a debt or accumulating a certain amount of savings—is reached. Turn over your paycheck to this person, let the person allocate sufficient cash to you to meet daily expenses, then work together to see that monthly bills, loans, and credit cards are paid regularly.

 Image Budget! Make a monthly budget sheet that shows ALL your monthly expenses, including one-twelfth of your annual expenses (those that you may pay just once per year, such as taxes, car insurance, and home owner’s insurance). You need to have a monthly financial plan with all your bills listed in front of you so you can see what you owe. This budget needs to be less than what you make per month. Keep this budget out on your desk at home so you can refer to it often. Spending as you go each month is a recipe for disaster, not to mention having your utilities turned off and your car repossessed.

 Image Start living within your means today. Do not spend more each month than you earn and then try to use credit cards, loans, or other means of borrowing to see you through the month. You need to get your living expenses below ninety percent of your monthly earnings while saving that remaining ten percent. Enlist the help of a trusted relative, an accountant, or a bank employee in figuring out your expenses and what method is best for saving.

 Image Set up a system of accounts and deposits for enforced savings. Have your employer put ten percent of your pretax earnings into a retirement plan (tax deferred) such as a 401k, 403b, Keogh, or IRA. Then have your after-tax paycheck direct-deposited into your checking account. Once there, have your bank move ten percent of it into a savings account automatically each month. You also need an emergency savings account for those unexpected expenses such as car repairs and medical expenses not covered by insurance. The less you see of your cash, the less you can spend it impulsively.

 Image Try to get health and disability insurance through your employer. If they don’t have it, try to find a similar job that does. If you can’t, consider working for the local, state, or federal government, which nearly always provides these as fringe benefits. Unexpected medical bills can kill your chances of financial independence.

 Image Balance your bank statement monthly without fail. Don’t just wing it or guess. Having little idea of how much money you have at any one time in your account(s) is one of the biggest causes of bounced checks, credit card overuse, and debt accumulation. You keep getting caught with less money than you thought you would need and so borrow to make up the shortfall. And those forms of piracy known as high overdraft fees that banks now charge can mount up quickly, siphoning off cash you actually need and maybe even result in your exceeding what typical balances you have in your accounts.

 Image Keep all receipts as you get them. Put them in your wallet. Each night when you take your wallet out, take these receipts and put them in a file. You can use this file to help keep track of what you are spending and to store the receipts that will be very useful for preparing your taxes and getting the most of your available deductions.

Six Steps to Curbing Your Spending

Besides the ideas for controlling impulse buying described in the section on a new approach to money management, try these:
 1.  Operate on a cash basis. Take out cash from your checking account only when you absolutely need it. Carry as little with you as possible so you're not tempted to spend it impulsively on stuff you don't need.
 2. Do NOT carry a credit or ATM card if at all possible. Get rid of all store credit cards, keep one general card like MasterCard or Visa, and put a sticker on it that reads FOR EMERGENCY USE ONLY. Transfer all unpaid balances on store cards to this single card and work to pay off the balance as soon as you possibly can.
 3. Do NOT go to a mall or department store if there is nothing that you need to buy. And I mean NEED, not want, to buy. The last place a person with ADHD needs to be is in a store or mall with all those attractive goodies crying out “Buy me!” So, the simplest solution is not to go.
 4. Don’t lend anyone other than your children any money. Period. And even your children are not a good bet to repay you, so keep those loans limited to educational expenses or necessities, not things like clothing or entertainment. Odds are you will not see that money again. If you give money to someone else, you’d better view it as the gift it most likely will be, not as a loan.
 5. Stay away from casinos. They always win. Don’t play cards for money and certainly no more than for pennies a hand. You are way too impulsive to be around gambling activities, so, like shopping, avoid such places, where impulsive spending can get the best of you.
 6. Take advantage of cognitive-behavioral treatments for impulse buying if no other measures help. If you find it hard to stop shopping and spending on things you don't need, get professional help from a psychologist or financial counselor.

Russell A. Barkley, PhD, is internationally known for his career-long research into ADHD and his efforts to educate professionals and the public. He is clinical professor of psychiatry at the Medical University of South Carolina and research professor of psychiatry at the State University of New York Upstate Medical University at Syracuse. The recipient of awards from the American Academy of Pediatrics and the American Psychological Association, among other honors, Barkley has published widely on ADHD and related disorders. His website is www.russellbarkley.org. Christine M. Benton is a Chicago-based writer and editor.
From the August 2010 issue of Attention. Copyright © 2010 by Children and Adults with Attention-Deficit/Hyperactivity Disorder (CHADD). All rights reserved. Reproduction in whole or in part without written permission from CHADD is prohibited.

Posted in: 2010, August