Discover Your Money Personality – An Important Step Towards Financial Success
Money is a constant in our lives. We earn it, spend it, save it, and invest it. On the surface, it may seem as if everyone views and handles money in a similar way. If it were only that simple!
If you were to give ten people $10,000 each, they would probably each choose to use the money differently. Some would splurge, while others would save. A few may invest while some would pay off debt.
If someone gave you $10,000, how would you use it? Your decision on what to do with the money has a lot to do with your money personality.
Your money personality influences your money habits and financial attitude. It is shaped by your upbringing, life circumstances, personal values, and beliefs. There are four common money personalities, each with its own spending, saving, and budgeting style.
While there is no right or wrong money personality, each comes with strengths and challenges that can affect your financial success. Once you know your money personality, it’s easier to make small changes that will have a big impact on reaching your short and long-term financial goals.
Read on to learn about the four common money personalities and ways you can work with each to make smarter financial choices.
“Money is only a tool. It will take you wherever you wish but it will not replace you as the driver.”
– Ayn Rand
The Splurger
The Splurger never thinks twice about spending money on any whim small or large. They live for the moment, rarely thinking about future financial stability. The Splurger often experiences a temporary rush of emotional satisfaction from shopping, and they don’t worry about budgeting or credit card debt. They may invest impulsively in high-risk investments. It may be difficult for them to save enough money towards long-term financial goals.
Tips for the Splurger:
- Focus your spending on things that will still be meaningful a year from now.
- Avoid impulse purchases by giving yourself a day to think it over.
- Ask yourself, ‘Do I have a lack in another area of my life that I’m trying to fill with spending?’
- Set up automatic transfers from your paycheck to your savings account.
- Take control of credit card spending and high-interest debt.
- Focus on education in wealth creation and how to invest
The Saver
The Saver loves creating budgets and counting pennies. They shop for only the necessary, saving their dollars for a rainy day. The Saver rarely uses credit cards and generally has no debt. Their frugal mindset allows them to sacrifice for the sake of reaching their long-term goals. They are conservative investors, preferring slow and steady growth.
Tips for the Saver:
- Seek balance between saving and enjoying the moment.
- Make spending for fun a part of your budget by contributing to a ‘splurge account’.
- Analyze your saving efforts to maximize your return.
- Explore your investment options and get educated on the different options available to you
The What Now?
Budget, what’s a budget? The What Now money personality rarely keeps tabs on their money, not knowing where the money goes or what they’re spending on. They usually don’t have a lot of savings and are not prepared for unexpected expenses. Investing isn’t very important to them, and they may carry credit card debt. Long-term financial goals are placed on the back burner.
Tips for the What Now?
- Work with a financial advisor to create a budget and minimize debt.
- Take control of credit card spending and high-interest debt.
- Consider simple actions to help you save such as automatic deposits.
- Choose one day a month to pay your bills and look over your finances.
- Set up an emergency fund separate from your savings account to cover 3-6 months of expenses.
The Planner
The Planner is a master money manager, finding satisfaction in creating budgets, paying bills on time, and saving for long-term goals. They enjoy learning about money and tend to make well-informed financial decisions. The Planner has money set aside for spontaneous fun, while also being prepared for unexpected expenses. They usually don’t carry unnecessary debt and use their credit cards wisely.
Tips for the Planner:
- Consider partnering with a financial advisor to maximize investments.
- Analyze your saving efforts to maximize your return.
Ready To Discover Your Money Personality?
If you’re keen on discovering your money personality, find out by taking our quiz.
Important Information: This information is of a general nature only and has been prepared without taking into account your particular financial needs, circumstances, and objectives. While every effort has been made to ensure the accuracy of the information, it is not guaranteed. You should obtain professional advice before acting on the information contained in this publication.
