Do You Know Your Money Personality?
Most people are
aware of zodiac signs. It is commonly believed that each sign has specific
characteristics that guide a person’s emotions and relationships. In a very
similar way, there are five very distinct money personality types. These are
(i) the big spenders, (ii) the savers, (iii) the shoppers, (iv) the debtors,
and (v) the investors.
It is important
to understand which of the money personality categories you fall into, in order
to benefit from the advice tailored to that specific type.
1. The Big Spender Money Personality
Characteristics – In order to
fall into this category one must ask themselves, “Do you love high-end
commodities and gadgets?” The “big spender” money personalities tend to be
highly fashion conscience people whom
are obsessed with having the best of anything available. Big spenders are very comfortable
with spending and rarely look at bargains when shopping. Those who fall into
this type must have the latest cars, attend and throw the best parties, must
have the smartest cell phones, take the greatest vacations, insist on the
largest plasma television sets and the like. Big spenders are comfortable with
high risks when investing and huge debts when spending. If this describes your
spending habits then there are steps to take to reel in the spending and save
your financial future.
Advice – You can do
very little about your urge to spend. The trick here is to concentrate whenever
you make a purchase on long-term value. Examine the value compared to the money spent in the long term. Buy only items
that will still be of value say, one or two years from the time of purchase. That
continued value justifies the big spending.
When it comes to
investing, learn to appreciate the thrill in smart investing as opposed to high
risk investing. Use the need to challenge yourself to find the most rewarding
of all investments and avoid the quick-gain propositions. The trick here is to
find something that is as thrilling as high-risk investments, while eliminating
the risk component. If and/ or when you are unsure of the best investment
options, seek professional advice.
2. The Saver Personality Money Personality
Characteristics – This money
personality type is the exact opposite of the “big spender.” Savers are
obsessed with saving at every opportunity. On the positive side, savers tend to
be debtless or carry the least debt and usually
only must-have debts. On the negative side, savers are often regarded as “cheapskates,”
who never want to put their hands in their own pocket when it comes to paying a
bill. People who belong to this money personality invest very conservatively
and run from risk as far and as fast as possible.
Advice – Recognize that
only saving is not going to make your life any fun. It is important to have fun
occasionally. Minimal entertainment spending does not mean that money or
resources are wasted. . Having fun and living life is as important as building
financial security. As the adage goes “everything in moderation,” with an emphasis
on “moderation.” Turn your attention to high-return, lowest-risk investments.
3. The Shoppers Money Personality
Characteristics – As the name
suggests, this group loves shopping. Shoppers are compulsive when buying, with
no regard to actual needs versus wants. What thrills and drives them is shopping.
Many times what is “bought” is not nearly as addicting as the act of shopping
itself. This drive can be for entertainment or due to compulsion. Often a “shopper”
shops for relaxation. This type is usually not very savvy on investing and/ or
saving. Although some may be partial to regular and safe plans such as a 401(k),
most postpone investments as much as possible.
Pay attention when shopping with credit cards. Credit cards can bury you in uncontrollable
debt. Use debit cards and only ONE of your credit cards; when possible stay
away from credit cards. Credit cards can ruin financial stability and can have
a crippling effect on ones future dreams. Pay attention to savings and
investment in plans that have low risk. Try identifying bargain investment
plans. It will give you both thrill and security.
[…continues in the next Newsletter]
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