Your Financial Personality Type and Your Money

Are You Prone to Spend Extra Money or Save It?

Whether you are likely to put “found money” away or spend it immediately, the key is whether you take this trait to its extremes. For example, people who receive a bonus at work may decide to spend it on a big-ticket purchase, which may actually cost more than the bonus they received. On the other hand, someone prone to saving their money may miss an opportunity to spend some of that bonus on an important life experience.

Are You a Budget Organizer or Budget Rebel?

Budget organizers are fascinated with number crunching and want to carefully track revenue coming in and expenses going out. They will not make a significant purchase without careful consideration. On the other hand, a budget rebel is independent, doesn’t want to get caught up in the arithmetic, and is more spontaneous in their purchase habits.

Are You Motivated by Improved Financial Security or Higher Social Status?

This may be related closely to the previous categories. A person who is a budget organizer may implicitly be drawn to attaining financial security, and not be a free spender. For that person, gaining social status may not be a primary concern. That individual is more concerned about the future—what happens if he or she is laid off from work or needs high-cost medical care? Again, taken to extremes, this is not a healthy financial strategy. The fear of these worrisome possibilities can prevent spending that is positive, like investing in a child’s education or on things they needed today.

On the other hand, those motivated by gaining social status may make monetary decisions based on concerns of minor importance to many, such as buying that million-dollar home so that friends and relatives will believe you are highly successful.

Do You Reflect Your Parents’ Mindset About Money?

We hear it all the time: People who grew up during the Recession of 2008 are affected by how their parents had to deal with their own financial situation at the time. For some of the younger generation who grew during those years, they may have decided to do the opposite of what their parents did financially! How our parents talked about money no doubt affected each of us.

We make little decisions every day that are influenced by how we think about money. These personality traits also come into play when considering large-scale investments and of course financial planning. During the market downturn last year, and the rebound in 2023, how did your savings or spending decisions change? If you were working with a financial advisor, you likely had someone to help inform your thinking and to discuss how to make the best choice for you, no matter the personality category.

Contact the Isakov Planning Group to learn more about your own financial preferences or tendencies and to work out a plan to works best for you.