Chapman, author of the Trauma of Money, explains that the brain has difficulty distinguishing between an actual lack of resources and the belief that resources are scarce. (Photo by Roberto Machado Noa/LightRocket via Getty Images) · Roberto Machado Noa via Getty Images
Chantel Chapman grew up dreaming of owning her own home.
“Ever since I was a young child, it was such an important goal for me and it’s because I grew up with housing insecurity. I grew up experiencing poverty,” said Chapman, CEO of the Trauma of Money Institute and author of the forthcoming book, The Trauma of Money.
But despite years of working towards that goal, Chapman didn’t achieve the milestone until she was 42.
“It was something I deeply desired but it also felt so far away from me,” she said, referring to challenging qualifying barriers due to self-employment and affordability issues, particularly in the Greater Vancouver Area.
Chapman’s experience reflects a broader trend across the country. According to the latest MNP Consumer Debt Index, nearly one-quarter of Canadians (23 per cent) say they are postponing major life milestones — such as buying a home, starting a family, or changing careers — due to financial strain. Among younger Canadians aged 18 to 34, that number jumps to 33 per cent.
While Chapman says affordability is the top barrier, she also points to psychological factors, such as scarcity thinking and instant gratification, that can keep people stuck in limbo.
She explains that the brain has difficulty distinguishing between an actual lack of resources and the belief that resources are scarce. This scarcity mindset can cause a “cognitive tunnelling” effect, where it becomes harder to stick to long-term goals because you’re hyper-focused on what you lack. That, in turn, can lead to a “bandwidth tax” — reduced cognitive capacity that can show up as lethargy.
“When the goal feels unattainable and so far away, you’re just more likely to act out on temptations, which takes you further from the goal,” Chapman said. Instead of socking away money for a home, for example, people might book a trip now, or buy a car with high monthly payments.
“Finances are complex,” said Thuy Lam, financial planner and money coach at Objective Financial Partners. And there’s an emotional piece that runs deeper than the numbers, which can be difficult to untangle.
But numbers can tell a strong story, she adds. Some people may feel so overwhelmed that their goals seem out of reach that they avoid looking at their finances altogether. However, when you face them, you can see what plans might be possible, or start setting a savings plan little by little to begin working towards them, Lam says.
Chapman also says that high usage of smartphones and social media among younger generations contributes to instant gratification. Research shows that constant exposure can lead people to underuse their pre-frontal cortex, which is a part of the brain that helps with temptation control, she says.
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