Written by: Anagha Bhat
As much as one would love to preach that money is not important or money won’t give you happiness in life, the truth is that a lot of the things revolve around money and it does affect a major part of your life. The way one deals with money is also influenced by their personality and it in-turn affects their lives.
Any 2 people who earn the same amount of money but respond to the incoming money differently will definitely lead very different lives. At times, you might not even realise what your money personality is, how it affects your decision-making skills, how making certain changes can give you the best results. If you too do not know what your type is, out of the major 5 major money personalities, and how you can alter certain things to lead a better life pertaining to money, then read on.
#1. Big Spenders
Are you someone that loves big brands? Does the new Gucci belt or Louis Vuitton bag excite you? Are you very interested in updating your gadgets every 6 months and buy the latest version of your phone and television? Do you try to make a statement with your new SUV car or the most fashionable outfit?
If you answered ‘yes’ to the above questions, then you belong to the Big Spenders’ category. Big spenders usually are on top of the trend. They end up buying gadgets and accessories even if there is no dire necessity for it and also don’t like to use the outdated version of anything. They do not bargain or even wait for something to go on a sale. They do not worry much about spending money and are comfortable taking bigger risks while investing.
If you too identify yourself as one, the main change you have to bring to your money personality is that you need to think thrice (not even twice) before making that expensive purchase. Ask yourself if it is a replacement to any of the product you currently use or if it is going to bring in a significant change in your life or if it is going to give you long-term happiness. If not, it is better to save that amount and probably think of investment.
Do you walk instead of taking the bus specifically because you can save INR 35? Do you avoid catching up with your friends in a restaurant only to save INR 300 for a meal and instead eat Dal Chawal at home? Do you make a list of the things you are in a real need of it yet wait for it to be sold on discounts? Do your friends and relatives call you Conjus or Skimpy?
If your answers were ‘yes’ to those questions, then you are a Saver. Savers are exactly what Big Spenders are not. They don’t care about what is on-trend and what is the fancy gadget all about. They are mostly never in debts and barely use their credit cards. Someone who is saver by nature gets satisfaction not by exchanging their money with a new product, but to see the big number in their bank account statement. What a saver doesn’t understand though, is that life shall pass by and they would not have enjoyed it enough in between worrying about the savings alone. Savers usually are conservative even to take a risk of a good investment.
If you are a saver too, then after you make sure you have saved enough money for your emergency fund and for any particular purpose that you are saving for, try to invest the money so that there will more income and then put in some money for your wants, desires and the fun part too. It is always great to strike a balance.
Do you feel immensely satisfied after a long shopping day? Do you know the best deals in the town and when exactly the stores are on sale? Do you see yourself buying a football when you are not even into sports, or you end up buying a whole knife set when you don’t even cook?
If ‘yes’ is your answer to these questions, then you are a Shopper. Shoppers don’t hesitate to bargain and don’t think about their needs and wants before buying. They get satisfaction in buying something new and acquiring things. They do invest a bit here and there though, but they mainly trip over their credit card bills since they cannot control their urge to shop.
If you too are sailing in this boat, then get yourself a notepad and a pen. Write down what you actually need before you step out to shop, be it outfits, gadgets or plain grocery. Do not buy anything that is not on your list. Benjamin Franklin quoted “Beware of little expenses; a small leak can sink the ship.” Even if buying that extra pair of socks, on the discount when you barely wear shoes and already have 12 pairs in your wardrobe, is considered a small amount, such a consistent behaviour might cause your bank balance a hit.
If you are asked you how much is your variable expense every month, would you be able to come up with a close approximation or would you wonder it yourself? Do you just not know how much your exact income is and how much you spend in an entire month?
Debtors are neither overboard shoppers nor big spenders, it is just that they do not calculate their money. They do not know how much exactly they earn in a month and how much exactly they spend. They do not keep track of everything. The recording process is just not their cup of tea and they don’t think too much about money and hence end up spending more than what they earn and are almost always in debt.
The best way to get out of this category, if you are in it, is to note down where you spend your money and how much. Be it a new phone worth INR 30000 or a pack of chips that is INR 20, keep a tab of everything that you spend. Do this exercise for a month and you will know your expenses well. If you cannot sort your money on your own, hire a financial advisor, who will help you organise your money and advise you on how much you save and where to invest.
Are you someone that always looks for ideas to invest your money? Do you carefully take bigger risks to achieve bigger returns? Do you sort your savings and investments smartly and make a conscious effort to earn passive income every month?
Yes? Then, yes, you fall into the Investors’ category. Financially, someone that has the personality of an investor, is the best out of the lot. They mostly strike a balance between extreme spenders and super savers and let the money play. They know that if their money is invested in the right place, can bring in more money. Keep learning and upping your game and you will achieve success.
It is not easy for any person to change his personality, even if it is a money personality. But what is important is that you analyse your category and bring in some changes so that it takes you to a better position. Doing an inventory check before buying, buying good quality stuff yet not overpaying for something that is available for a cheaper price, turning off the temptation yet not holding in all your wants and desires, saving and investing are some of the tips and tricks that you can apply to your day-to-day money habits and see the changes eventually.