09/13/2011 12:38 EDT | Updated 11/13/2011 05:12 EST

How You Think About Money Is as Important as How Much You Have

The Adventures of the Sandwich Generation is for all those boomers who are squeezed between the demands of raising their kids and the responsibility of caring for their elderly parents -- all while managing their own issues in-between. It's a celebration of this exhilarating and sometimes heartbreaking ride and an attempt to provide insight, advice -- and as often as humanly possible, humour. Definitely humour. As actress Bette Davis once said, "Fasten your seat belts, it's going to be a bumpy night." But hey, if it wasn't a little bumpy there'd be no thrills at all, would there? Keep smiling and... buckle up

With apologies to Scarlett O'Hara: "As God is my witness, I will not be a bag lady in 30 years!"

That is my goal and the goal of many boomers who find themselves struggling with the costs of children at home or in university, a volatile economy wreaking havoc on their savings and investments, elderly parents who need costly care and a host of everyday demands and unexpected crises.

We all want to make sure we have enough money for the future but there are so many strains on the budget these days. The truth is there will always be something you didn't see coming. And like most everything in life, how you respond to a situation is usually more important than the situation itself -- no matter how dire it may seem.

That's why Scarlett O'Hara is such a good role model for boomers who feel like they're two toonies from oblivion on any given day.  She didn't let circumstances do her in and she had a very practical relationship with money and how it could work for her.

What's your relationship to money?

How you respond to the demands on your budget has everything to do with your relationship with money. Is it a tool that you control or have you no idea how to manage it? Do you follow a budget? Would you rather save what you can than take a risk and invest?

Think back to the home you grew up in. Did your father manage the finances leaving your mother in the dark? Did your father earn the money and give it to your mother to manage? Did your parents both contribute to the finances and jointly run things? Did they teach you the importance of saving and investing when you were young or did you learn what you know through trial and error?

Fortunately today's education system is finally realizing the value of teaching our kids about money management but for many boomers it was the luck of the draw. If your parents didn't teach you about money you were on your own -- and you may have developed problematic beliefs about it too.

Erroneous beliefs about money

How we think about money is as important as how much we have -- perhaps more important. Do you think you deserve to be financially stable? Do you think people put too much emphasis on money? Is it better to be poor and happy than rich and unhappy? Are you optimistic that things will work out somehow?  What beliefs have you developed about money and are they sound?

Often it's how you think about money that is keeping you from having enough to live on comfortably. Those beliefs about money can also influence whether or not the money you have, grows. In fact, having money that grows for you - residual income that comes in whether you're working or not -- is very important. It can be the key to whether you are struggling or whether you are prospering.

Bad habits can be unlearned

The good news is that bad beliefs and habits can be unlearned. With knowledge, discipline and fortitude, we can always change course and move forward.

For example, many women would rather save their money in vehicles like GICs than risk investing it in mutual funds. But the key is to save as well as invest and to build a diversified portfolio.  If your income is low it may make sense to take out an RRSP loan and use the tax refund to help repay it so that you are still increasing your RRSP. Maybe you should take out a line of credit and invest some of the money for the future. There are many creative options that your bank manager or certified financial planner (CFP) can suggest. You can also attend money management workshops in your local area.

It is often the way we think about money that keeps money away from us, not the reality that we don't earn a lot or the fact that circumstances beyond our control have put us in debt.

Whenever you're feeling overwhelmed by the demands on your bank account, take a moment and think about your relationship toward money. There is a very definite correlation between how financially prosperous you are and how you think.

Here are some links you may find helpful:

For tips on saving for retirement check out:

* * * * * Canada's Guide to retirement living