Wealth therapy is bogus—and so are its roots in "financial therapy."

Why You Should Never, Ever, Ever Take “Wealth Therapy” Seriously

Why You Should Never, Ever, Ever Take “Wealth Therapy” Seriously

Moneybox
A blog about business and economics.
Oct. 19 2015 7:00 PM

Why You Should Never, Ever, Ever Take “Wealth Therapy” Seriously

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Even traders need someone to talk to.

Photo by Andrew Burton/Getty Images

Permit me a plea: Can the media please, please, please stop treating the field of “wealth therapy” with the seriousness its practitioners believe it deserves?

Helaine Olen Helaine Olen

Helaine Olen is a former columnist for Slate and co-author of The Index Card. She was the host of the Slate Academy series the United States of Debt.

The most recent example came this weekend, when the Guardian decided to take a look at the burgeoning practice of tending to the money woes of the 1 percent. One of the first clues something was amiss came early in the piece, when a counselor specializing in tending to Manhattan’s wealthy claimed many of his clients believe “they have to hide the fact that they are rich.”

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Stop right there.

I live in New York City. Anyone attempting to hide his or her wealth in this place is probably doing a piss poor job of it. This is a town where the local paper—that is, the New York Times—ran an article earlier this year headlined “When the 13-Year-Old Picks a $14 Million Condo,” and where the average apartment sale is now just under $2 million. If someone is pretending he’s not rich, he’s not someone we need to take very seriously.

So what exactly is wealth therapy? It’s an offshoot of something called financial therapy, a discipline that attempts to merge the world of psychology with our feelings about money and what we want it to accomplish for us. The Financial Therapy Association claims 250 members, though that’s almost certainly not all of the therapists, coaches, and the like offering themselves up as specialists in money or wealth therapy.

Wealth therapists, of course, specialize in treating the issues of the wealthy. For its article, the Guardian rounded up a bunch of consiglieres to the super-rich, who gave a load of quotes that made me very, very, very sad that Marie Antoinette didn’t have access to their advice before she commissioned an imitation peasant village on the grounds of Versailles. “It’s really isolating to have a lot of money. It can be scary—people’s reaction to you,” said one Barbara Nusbaum, described as “an expert in money psychology.” Another flagged Occupy Wall Street as a stressor because it made “a value judgment about a particular group of people as a whole.” Elliot Hannon did yeoman’s work highlighting the worst quotes in Slate on Sunday.* Check it out, if you can stomach more of the above.

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As I reported in my book Pound Foolish, financial therapy originated in the late 1970s in California (where else?). Two pioneers included Herb Goldberg and Robert Lewis, who wrote Money Madness: The Psychology of Saving, Spending, Loving, and Hating Money in 1978. Soon there was affluenza (also California!), which purported to describe the feeling of malaise and depression that came with too much prosperity, while other therapists began to discuss “archetypes” or “personalities” that determine our “money scripts,” which are unspoken beliefs about money that we form as toddlers or small children. Others came to specialize in inheritors, Wall Street titans, or self-made men.

Over time, this stuff got traction. The New York Times published a semifawning article about the practice on Sept. 24, 2008—a mere two weeks after the crash of Lehman Brothers. In that piece, financial therapy poster girl/country music star Wynonna Judd proudly recounted how, after going through a program on beating back money issues, she downsized from five Harleys to just two, not to mention the cars “we actually use,” adding, “If I can do it, anyone can.” At the same time, of course, any number of Americans were downsizing for different reasons. Foreclosures increased by 81 percent in 2008 over the previous year. More than 1 million people lost their homes, according to Bloomberg.

So what could the appeal of wealth therapy be in this sort of economic environment? Well, permit me a theory. Traditional talk therapy has been under siege in recent years, stressed by the rise of pharmaceuticals like Prozac on one side and less-than-generous insurance reimbursements on the other, where the number of sessions for someone who is suffering from mental distress—not to mention severe mental illness—are often capped.

When I reached out to the therapists quoted in the Guardian article to ask them their rates, one did not respond, one wrote back to say she wants “NO FURTHER AFFILIATION WITH THIS ARTICLE,” and a third, Clay Cockrell, charges between $225 and $400 per session, depending on a number of factors including time of day. (“Many clients need to see me after work hours (post 6pm) those slots are a premium,” he wrote in an email.)

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Wealth therapy isn’t a problem because people with money have unique issues—they likely do. Nor is there much harm in separating rich people from their money in exchange for listening to their woes—that’s the theory of the trickle-down economy, after all. Wealth therapy is disturbing because it flatters the ego of the wealthy client while implicitly blaming the less fortunate for their own financial woes. True, the self-help movement often indulges in this sort of stuff too, but licensed therapists bring a degree of authority to the debate that the average self-appointed guru does not.

If, for example, you are wondering what the therapist quoted by the New York Times, Brad Klontz, thought of the economy’s near-implosion in 2008, let me help you out. In 2010, he was featured in yet another article about financial therapy in the New York Times. His take on the problems of the financially challenged: “The predatory lending and the greedy people on Wall Street, they’ve certainly played a role in this, but what led you to buy a house you couldn’t afford, even if someone let you do it?”  

But don’t accuse Klontz of lacking sympathy for the severely troubled. In 2013, he compared the impact of the recession on financial advisers to post-traumatic stress disorder, telling the Wall Street Journal, “In 2008, when we saw hundreds of our clients lose 30% to 40% of their net worth, it was an absolutely terrifying, helpless, horrifying experience.”

It’s hard to avoid the suspicion that perhaps Klontz needs a wealth therapist of his own. 

*Correction, Oct. 20, 2015: This post originally misspelled Slate contribuor Elliot Hannon’s first name.