You know for a fact that your neighbour earns far less than you do. So, how is he able to afford those renovations and that flashy car? Well, it might have less to do with how much money he has and more to do with his money personality.
Your money personality impacts on how you manage your finances and how you spend – or don’t spend – your hard earned cash. Read on to find out more about your money personality.
Types of money personalities
The hoarderYou are loath to spend any money. You squirrel away as much as you can and often have several little pots of savings in different investment vehicles. When you say, “I have no money”, it is rarely the truth.
What you can do: This is not necessarily a bad personality to have as you are likely to enjoy a very secure retirement and have the funds you need to deal with financial crises. However, you should learn to spoil yourself occasionally. Set aside some “crazy money” that you can spend without any qualms.
The spenderLives like there is no tomorrow and can often be heard saying things like “Life is too short so I’m going to make the most of each day”. Budgeting is a guideline and if you see something you want then you buy it with little or no hesitation, justifying your purchase with the thought that you deserve it.
What you can do: Learn to keep track of your expenses. If you keep every receipt for a month, you will be shocked to find out how much you really spend and what you are spending on. You can still spoil yourself but limit these purchases to once a month. A good idea is a 48-hour rule. If you see something you want, wait 48 hours before you actually buy it and use the time to think about whether you really need it.
The avoiderMoney makes you feel uncomfortable. You are the first to bow out of the conversation when the topic comes up and your annual meeting with your financial planner is like torture. You like to think that things will sort themselves out somehow and you have a vague idea that you should pay more attention to your finances.
What you can do: Unfortunately, money is something that you have to deal with. And if you don’t pay sufficient attention to your money, chances are that someone else will, usually by ripping you off! Set aside time at least once a month to go over your finances and work out a budget so that you can be sure you have more money coming in than money going out.
The haterYou dislike money and wish we lived in a “free world” where people bartered instead of spending money. You give money away when you have it and feel guilty if you think you have more than the next person. You also actively dislike people who have money and flaunt it when it could be put to better use such as saving the rain forests.
What you can do: Find a charitable cause that you can contribute to regularly or give a charity something even more valuable than money – your time. You could link your bank card to a “green cause” where eco-friendly projects receive a donation every time you swipe. Remember that you are reducing the burden on society by earning a salary and providing for yourself. Lastly, stop judging others so harshly!
Your money personality is largely shaped by your childhood and the lessons you have learnt about money along the way. But this doesn’t mean you can rely on the excuse of your personality to justify poor financial choices. Understand your money personality and work to improve it where you can.
“Money, if it does not bring you happiness, will at least help you be miserable in comfort.” – author, Helen Brown.