We all have intrinsic habits based on how we grew up, experienced formative periods in life, and how we internally relate to the world. You may have already heard of the Myers-Briggs personality test, defined by Extraversion/Introversion, Intuition/Sensing, Thinking/Feeling, and Judging/Perceiving — but did you know you also have your own money personality?
It’s true! And knowing what kind of money personality you have can help you better understand how to make decisions around your finances. Being aware of your natural tendencies and characteristics can help you make improvements to any negative money habits you may have.
Money Personality Types
Much like the Myers-Briggs test, it’s possible to be a combination of many different money personalities at once. Also, even if you have a seemingly “negative” money personality, it doesn’t mean that defines you entirely. These money personalities are starter descriptions on how you relate to money, but you may have a combination of two or more personalities.
The following money personalities are based on two qualities: Savers and Spenders. Read the descriptions below to see if you lean more toward the spender personality or saver personality, or see if you fall in between!
The Impulsive Spender
The Impulsive Spender purchases things, goes out to eat, and enjoys life without planning ahead. While the Impulsive Spender may like the idea of a budget, they rarely stick with it for a long period of time.
If the Impulsive Saver makes enough money, they can generally go through life not really noticing how their impulsive purchases affect them. In addition, Impulsive Spenders with a sufficient salary generally feel less anxiety about their finances because they are able to buy what they want and need, when they want and need it.
But being totally carefree about finances — even when you make a lot of money — can lead to trouble. Things can and do go wrong and the unexpected happens.
If an Impulsive Spender doesn’t make enough money, they may reach the end of the month stressed out about finances. An Impulsive Spender may also have a lot of “stuff” in their house that they don’t need, which may clutter up their space, leading to more stress. Even an Impulsive Spender with a high salary may suffer, as they’re letting too much discretionary income slip by and not investing it for retirement.
The Carefree Spender
This spender makes purchases without thinking about his or her bottom-line, often because they lack the know-how to create an effective budget. Unlike an Impulsive Spender, they may not care they have to subsist on ramen at the end of the month, but they may not know why it’s happening.
Similar to an Impulsive Spender, Carefree Spenders usually have less anxiety about their budget. Carefree Spenders may prefer this scenario, as they may have chosen a career that doesn’t pay well on purpose. Carefree Spenders may have a more casual attitude about their life purpose that doesn’t center on money.
But without an effective budget, a Carefree Spender may not have the necessary funds in retirement or to survive a setback (job loss, accident, disability). A Carefree Spender that has an important-yet-underpaid job, like teaching or social work, needs to set a budget as soon as possible. Even if they don’t care about material possessions or living an extravagant lifestyle, Carefree Spenders need to put aside a small savings for those “just-in-case” moments.
The Thoughtful Spender
A Thoughtful Spender is someone who thinks of everyone else first, and themselves last. They’re the person who shows up with the perfect gift or sends “thinking of you cards” just because they really were.
Thoughtful Spenders are givers, and get a lot of affection in return. If they fall on hard times, Thoughtful Spenders generally have a wide network of people to contact for support.
Like the Carefree Spender, the Thoughtful Spender generally doesn’t have a lot to show for their purchases at the end of the month (other than goodwill of family and friends). Unless the Thoughtful Spender has a high salary to compensate for their purchases, they are short-changing themselves by buying gifts for everyone else.
The Thoughtful Spender doesn’t have to stop getting thoughtful presents for people, but may want to consider giving the gift of time, or less expensive gifts (like bringing over food, or homemade gifts) instead.
The Avoidance Saver
The Avoidance Saver may be an introvert by nature, and they use their money-saving habits as an excuse to not hang out with people. While the Avoidance Saver may be very close to family, and have a few friends, they likely aren’t the ones to socialize at or after work.
The Avoidance Saver, if they are investing well, is likely to have a large retirement savings when the time comes. Depending on the Avoidance Saver’s passions, they may be the type to meticulously calculate their savings and even plan an early retirement because of their diligent avoidance of spending any money outside of necessities.
Depending on how much avoiding the Avoidance Saver does to save money, they may suffer from a lack of promotional opportunities. In many industries, networking with peers leads to more growth opportunities. Going home right after work may keep the Avoidance Saver from promoting faster or having access to other opportunities.
In addition, by avoiding some activities to save money, the Avoidance Saver may not get to enjoy some of their prime years. Avoidance Savers should prioritize activities over things, and carefully spend money in accordance to their priorities throughout the years.
The Obsessive Saver
The Obsessive Saver is, well, obsessed with saving — and often other money-making ventures, like investing and side hustling. Well-versed on all things related to saving, investing, and building a portfolio, the Obsessive Saver is often motivated to go above and beyond to educate themselves and work hard. Their reward? Watching their investments grow.
But the Obsessive Saver’s enthusiasm for new products (like new stocks) could potentially lead them to make dubious investments. In their quest to maximize their investments, Obsessive Savers may also keep their money in the stock market longer than is prudent, as stock investments should decrease the closer you get to retirement. The Obsessive Saver may want to consider hiring a financial planner to help keep their core investments safe, while still allowing them some room to make riskier yet profitable bets.
The Apocalyptic Saver
The Apocalyptic Saver is a money hoarder, plain and simple. Whether the Apocalyptic Saver thinks the banking system is going to collapse, or they were burned by the stock market and don’t trust it any longer, the Apocalyptic Saver saves their money either in cash, in bonds, or a little bit of both.
In their quest to have the safest savings, Apocalyptic Savers may miss out on tremendous gains from the stock market. If they only keep their savings in a savings account, they risk losing money to inflation. Apocalyptic Savers have to balance their desires for safe investments while still maximizing returns to take care of themselves in the future.
What’s Your Money Personality?
Do any of these personality types sound familiar? It’s likely that you identify with one more than the others — although most of us probably fall somewhere on a spectrum rather than in the extremes. Knowing your type can help you identify strengths to rely on, and it can also help you pinpoint potential trouble areas.
If you do see negative money habits creeping into your everyday interactions, it’s good to know it sooner rather than later. After all, your money personality isn’t fixed forever. If there are habits you’d like to improve, set goals and take action to make the changes you want to see with your money management!