(Article) Understanding Your Personality Type When It Comes To Money.

The relationship you have with your personal finances is more important than how much you make.

Your money personality type can help you understand your relationship with money and see where you’re going wrong.

It’s easy to assume that being a compulsive saver is good, and a compulsive money maker even better, right?

But every money personality has it’s pros and cons.

Which one are you, and what can you do about it?

The Compulsive Saver

You may be a compulsive saver if you love saving money, always shop around for the best deals, and hate spending on luxuries or inessentials.

The clue is that compulsive savers can also be known as ‘stockpilers.’

They stockpile money rather than putting it to good use.

They can be so scared of spending that they deprive themselves and their families.

They may be too frugal to spend money on travel, hobbies, or fun, even though they could afford to.

Stockpiling can stem from previous bad financial experiences.

Compulsive savers have often been poor in the past and don’t want to go back there.

If this is you, you may need to find a way to enjoy your money more and give your loved ones a better life while still being sensible so you feel financially secure.

Saving is great, but there’s little point in money that doesn’t make any difference to your life or anyone else’s.

The Compulsive Spender

Compulsive spenders spend a lot, often on things they don’t need and sometimes using money they don’t have (Loans & credit cards).

They’ll justify their spending any way they can.

A recession isn’t a time to tighten your belt if you’re a compulsive spender.

In fact, they’ll claim that a bad economy is a result of people not spending enough.

Compulsive spenders may suffer low self-esteem and get a sense of self-worth or a feeling of power and control when they spend money.

Compulsive spenders were often raised by compulsive savers and are making up for a sense of deprivation during their childhood.

If this is you, you probably already know you need to get your impulse spending under control and pay down your debt.

The Compulsive Money Maker

What could be wrong with making money?

Nothing, of course, under normal circumstances. But when taken to extremes, there are drawbacks.

Compulsive money makers focus on making money to the detriment of everything else and believe making money is the ONLY source of happiness.

If this is you, there’s no need to stop making money, but there is probably a need to put effort into other important areas of your life too.

The Gambler

The gambler may literally enjoy gambling or might simply enjoy taking risks such as starting new businesses or making risky investments.

Gamblers love the thrill, don’t employ good risk management strategies, and don’t have much self-discipline when it comes to money and investing.

Gamblers often make big losses, although they sometimes make big profits too.

If this is you, you need to take a look at how your decisions are affecting you.

Taking risks is not, in itself, always a bad thing, but wise investors manage those risks carefully and don’t gamble (in any form) with more money than they can afford to lose.

The Indifferent-To-Money Personality

It’s hard to be indifferent to money in this day and age, but not impossible.

Some people rarely think about money, don’t attach too much importance to it, and make most of their decisions based on non-financial factors.

They probably don’t spend much but also don’t focus on saving.

They may have no idea how much money they have or where it is.

Some may leave managing finances up to their partner or parents; others may simply have very

disorganised

finances.

These people were often comfortable during childhood and generally still are, as they’re usually gainfully employed and don’t spend much.

The Saver-Splurger

This personality type saves and saves, then spends and spends, often irresponsibly.

Money in the bank is simply a temptation to give in to the impulse to spend.

They don’t enjoy the satisfaction of seeing the numbers in their account go up but rather feel the need to go out and reward themselves, often with things they don’t need, once they have a lot of money.

If this is you, you need to address impulsive spending and set better (or more meaningful) financial goals that will help you focus on continuing to save for the future when the spending impulse hits.

The Worrier

Worriers might have a high income or a low one, lots of savings, or none at all.

No matter what their financial situation, they will worry about it, often obsessing over worst-case scenarios when it comes to finances.

They lack confidence in their own financial literacy and assume they will lose any money they have or make bad decisions around it.

Worriers do not, of course, only worry about money. This is a more deep-seated trait, and they will often worry about everything else in life as well.

If this is you, it may to address the general problem and try and deal with the overthinking and obsessive thoughts that tend to come up on every area of your life.

But it can also help to educate yourself on personal finance (and other issues you obsess over) as more knowledge can give you a bigger feeling of control and a more logical, less emotional view of what you worry about.

Closing Thoughts

By now, you probably have a good idea of what your money personality is.

It’s hard to change your personality type, but understanding it can be the key to better financial decisions and less money stress.

Till next time.