You have probably taken a personality test on the internet. While most personality tests focus on relationships and careers, very few look into how different personalities spend money.
Knowing your money personality helps you understand the benefits and pitfalls of how you manage your money. This knowledge enables you to determine the best approach to making sound financial decisions.
If you struggle to save, spend, or invest your money, start your journey to financial freedom by understanding your money personality.
The Hoarder/Saver
Hoarders or savers attach their security to money. People with this money personality always have some cash hidden for a rainy day. A saver knows how much it costs to leave the lights on when not in use or how much a leaky faucet increases the water bill. If your family or friends describe you as frugal, you are probably a hoarder.
Hoarders are usually people born in families where money was tight. If you are a hoarder, you are very mindful of how you spend your money. Thus, you may experience buyer's remorse whenever you make big purchases.
Hoarders are very conservative investors, and whatever they invest in has minimal risk. Others never invest their money, preferring to save it.
If you are a hoarder, know that saving is not the best path to growing your money, as inflation may eat into your savings. Therefore, consult your wealth manager on low-risk investments to channel some of your savings into.
The Spender
Spenders often drive the latest cars, have the fanciest gadgets, and wear trending fashions. They are always looking for the next thing to buy and often spend with little thought of the future. You are a spender if you usually splurge on things even when your budget does not allow it.
Spenders are comfortable spending money and do not fear debt. So if a spender is not financially stable, they may accumulate a lot of debt. A spender is also likely to invest in risky ventures.
If you are a spender, you will do well as an investor if you have the right person guiding you. It also helps to have a budget plan if you are a spender.
The Investor/Moneymaker
Investors love making money and are always looking for the next payday. People with this money personality keep a close look at their finances. Therefore, they most likely have a full picture of their financial situation.
Investors are keen on financial literacy. Thus, they are likely knowledgeable about different financial markets. Investors are strategic in what they spend their money on. However, some investors are more cautious than others.
Most investors spend their money with an end goal, whether a future income or a better credit score. If you are an investor, understand your risk appetite before making investments. You may also want to consult a professional to help you attain your financial goals.
The Avoider
Avoiders are indifferent to their financial situation. They rarely think about money and don't keep tabs on their expenditure. An avoider is likely to hide from their money problems. They also probably have no savings and do not make long-term investments.
Avoidance is common in people who suffer from anxiety. Thus, making no decisions about their finances may feel better for avoiders than having to evaluate their financial situation.
You are an avoider if you like investing but have no idea what your investment banker or financial manager has invested in. You are also an avoider if you save money but have never asked about your bank's savings rate.
If you are an avoider, consult a financial planner to help you review your finances and set you on the path to better financial management.
Most people have a combination of the traits of the above four money personalities. But if you lean toward one personality too much, consider acquiring the services of a professional financial planner like Presidio Wealth Management to help you counter the pitfalls of your money personality.Contact ustoday, and let us help you achieve financial freedom.