Some financial experts (“experts”) cite a lack of personal responsibility as the main reason people fall on hard times. Their messages are often imbued with a heavy dose of blame and shame:
You shouldn’t have so much debt! You shouldn’t have any debt at all! You shouldn’t have bought that car! Or gone to that college! You didn’t even major in engineering! If you’d eaten your veggies and biked 25 miles a day, you wouldn’t have gotten sick and landed in the hospital and wound up with thousands of dollars in medical bills! And just look at the state of your accounts. By your age, you should have at least x amount in savings and y amount in retirement.
You’ve dug yourself a deep financial hole, my friend, and now only you can extract yourself!
There’s no denying that our individual choices have an enormous impact on our finances. It’s true that buying stuff you can’t afford, especially if it becomes a habit, can lead to financial problems. It’s also true that measures such as tracking your spending, paying your bills on time, being mindful of your purchasing habits, making and sticking to a debt repayment plan, increasing your income, and saving for the future can help cultivate a healthy financial life.
But many people who take these steps still struggle financially. That’s because even the most determined and money-savvy among us can be tripped up by systemic factors far beyond our control. Low income, illness, disability, racism, sexism, anti-gay and anti-transgender prejudice, high unemployment, lack of reliable transportation, and skyrocketing housing, healthcare, childcare, and education costs are just some of the all-too-common issues that can easily thwart a person’s progress – even when they’re highly motivated, and even when they know perfectly well how to manage their money.
A truly holistic approach to personal finance acknowledges both the individual and systemic factors that influence someone’s financial situation:
It educates, empowers, and encourages people to make the best possible choices with the resources they have.
But it also identifies and examines the deeply-rooted structural issues that hold people back and advocates for a system that facilitates financial progress for everyone.