When it comes to money, a person’s personality plays a meaningful role in their financial decision-making. Every person is unique, and that’s what makes us human, so it really shouldn’t come as a revelation that there are various types of personalities that are more likely to have money issues than others. It’s tough to adjust your personality traits, in particular when you’re older, so simply being aware of how your personality impacts your financial decisions may help you make better financial decisions down the road. It’s undoubtedly an important topic to understand, as money issues can compound rapidly and you can find yourself in deep water within the blink of an eye. This post will look at 4 different personality types whom are more likely to have money concerns, together with some recommended ways to improve your financial situation if you fall into one of these personality groups.
- The Risk-Takers
Fiscally speaking, the higher the risk the higher the reward, but the likelihood of experiencing high risk success is substantially low. Some folks are born as risk-takers, others develop this personality trait in time; but in many cases, it’s the thrill of the risk that these types of individuals revel in. Statistically, the odds of financial success for the risk-takers are low, so it’s important for these types of individuals to diversify their risks to increase their odds of financial success. These individuals can make high-risk investments, but they can’t put all their eggs in one basket. A blend of high-risk and low-risk investments will substantially improve their financial future.
- The Spenders
No matter if they’re wealthy or not, the spenders are the types of folks who live life to the fullest without contemplating the financial implications of their decision-making. Whether they’re spending money to enjoy themselves, look good, or to simply please others, the spenders are likely to incur significant amounts of debt which can take a long time to repay. Subsequently, their opportunity of financial success are considerably restricted. Saving money is the key to financial success, so to avoid overspending, the spenders need to consider developing a budget to track their spending habits and at the same time, analyse the triggers that cause them to spend their money to begin with. Addressing the triggers that cause these types of people to overspend is the key to fixing the problem.
- The Ignorants
The ignorants are usually the type of folks that are financially uneducated and have no interest in improving their financial skills. The ignorants may have a similar frame of mind to the risk-takers in that they want to ‘live life to the fullest’ and as such, spend all of their money and find themselves in debt. It’s vital that individuals with this personality trait learn the value of money and how it can be used to provide a better future. Rather than thinking about now, they should attempt to think about how spending their money now will have an effect on their future. Take an interest in learning how to budget by reading online weblogs and articles. Who knows, they might actually enjoy it?
- The Pessimists
In stark contrast to the risk-takers, the pessimists often tend to pass up on opportunities to make money purely because they fear they won’t succeed. When it involves large investments like buying a house or investing in the stock exchange, the pessimist will avoid taking any risks for fear of losing their hard-earned money. The challenge with the pessimists is that by avoiding all risks, they will feel more safe, and this will impair their likelihood of financial growth and success. A good solution for the pessimists is to diversify their investments in a wide-range of markets to make certain they have a well-balanced portfolio that is low-risk and offers an opportunity for a good return.
There are obviously many other personality types than the ones detailed above, however these are likely the most common personality traits that impairs financial growth and can lead to money problems. In today’s world, money is without question extremely important not only for survival, but also to be able to enjoy the only life we have. Just because you have specific personality traits doesn’t imply that you can’t alter some of them in time to be more financially responsible. If you need any support with your finances, or you’ve ended up facing a mountain of debt as a result of overspending, get in touch with Bankruptcy Experts Frankston on 1300 795 575 for assistance, or visit www.bankruptcyexpertsfrankston.com.au for more information.