What do you do if your financial decisions are negatively impacted by a lack of emotional intelligence?

2 Manage your emotions

Once you identify your emotions, you need to learn how to regulate them in a healthy and constructive way. This means finding strategies to cope with negative emotions, such as stress, fear, or anger, and to enhance positive emotions, such as gratitude, joy, or optimism. For example, you can practice relaxation techniques, such as breathing exercises, meditation, or yoga, to calm yourself down when you feel overwhelmed or anxious. You can also use affirmations, journaling, or gratitude lists to boost your self-esteem and happiness. By managing your emotions, you can reduce their impact on your financial decisions, and instead focus on your goals and values.

3 Understand others' emotions

Another aspect of EI is the ability to empathize and communicate with others, especially those who are involved in your financial life, such as your partner, family, friends, or advisors. You need to be able to listen to their perspectives, feelings, and needs, and to express your own in a respectful and clear way. For example, if you are planning to buy a house with your partner, you need to understand their preferences, fears, and expectations, and to share yours as well. You also need to negotiate and compromise on the best option for both of you. By understanding others' emotions, you can build trust and cooperation, and avoid conflicts and misunderstandings.

4 Learn from your emotions

The final step of EI is to use your emotions as a feedback and learning tool. This means reflecting on your past financial decisions, and how your emotions influenced them. What did you do well, and what did you do poorly? How did you feel before, during, and after the decision? What were the consequences and outcomes? How can you improve next time? For example, if you regret buying something on impulse, you can analyze what triggered that decision, how it affected your budget and goals, and how you can prevent it in the future. By learning from your emotions, you can grow and improve your financial skills and habits.

Emotional intelligence is not a fixed trait that you are born with or without. It is a skill that you can develop and practice over time. By applying these tips, you can enhance your EI and make smarter and more rational financial decisions that benefit your long-term well-being.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?