In the real world, our money choices aren’t just about cash. They show what we’re like on the inside. While the saying “money can’t buy happiness” rings true, our saving and spending habits give hints about who we are.

When things get tough, like during the COVID-19 pandemic, some folks start buying things to feel in control. Others get worried and save more. But these habits aren’t just about money – they show us parts of our personality.

This article looks into the psychology behind spending behaviors and explores the diverse money personality types that shape our financial lives.

Spending and Saving: What’s the Deal?

We all handle money differently, especially when we’re stressed. Take the Covid-19 time, for example. Some people feel better buying things, kind of like they’re taking charge. Others worry about money and try to save as much as they can. But it’s not just emergencies. The way we spend and save tells a story about who we are.

How Your Past Shapes Your Money Habits

Think about your family. How your parents deal with money can affect you. Studies conducted by experts like Scott Rick, Associate Professor at the Michigan Ross School of Business, highlight the influence of maternal spending behaviors on children.

Life experiences matter too. If you lost money when it was super important, you might become careful with money. Or if you had a time when you didn’t have much money, you could keep those habits even when things are better.

Surprisingly, how much money you make doesn’t decide if you spend or save a lot. As Brad Klontz, founder of the Financial Psychology Institute, emphasizes, our money scripts—beliefs and emotional connections to money—are shaped by a combination of factors, including what we learn from others, our culture, and the people we hang out with.

Feeling Uncomfortable About Spending

One big thing is how uncomfortable you feel when you spend money, as noted by Cynthia Cryder, an associate professor of marketing at Washington University. It can show how much you save and if you have credit card debt. In simpler terms, if spending money makes you uneasy, it affects your choices.

Also read: 5 Financial Books to Strengthen Your Saving Habits

Understanding Your Spending Habits: A Closer Look

Now, let’s dig a bit deeper into these spending personalities. They aren’t just labels; they’re colorful mixes of emotions, experiences, and social influences. Each type has its own story:

1. The Compulsive Saver

Compulsive savers aren’t just pinch-pennies; they’re after security. Saving isn’t just a habit; it’s their way of feeling safe in an unpredictable world. But, there’s a balance to strike. Saving every penny may mean missing out on some fun and connections.

2. The Compulsive Spender

Compulsive spenders love the thrill of buying. It’s like a quick fix for them, especially when they’re feeling down. But, it can lead to debt and stress. Learning to spend wisely, not just impulsively, can help them find lasting happiness.

3. The Compulsive Moneymaker

Compulsive moneymakers chase not just money but approval. They want recognition from others for their financial success. Yet, this can strain their personal lives. Balancing ambition with well-being can lead to a more fulfilling life.

4. The Indifferent-to-Money

Some folks don’t let money rule their lives. They think too much focus on money can lead to trouble. But this attitude might mean they’re not paying attention to their finances or relying on others to manage them.

5. The Saver-Splurger

Saver-splurgers are a bit of both. They save diligently but also love an occasional splurge. However, this dance between saving and spending can be emotionally tiring. A mindful approach to spending can help them find balance.

6. The Gambler

Gamblers love risks, especially financial ones. They enjoy the thrill of it all. But, this can lead to big wins or big losses. Finding a balance between risk and security can make their financial journey smoother.

7. The Worrier

Worriers are, well, always worried about money. It’s not bad to be cautious, but too much worry can stop them from enjoying life now. Seeking advice and staying positive about money can help ease their concerns.

Recommended read: 7 Effective Target Savings Techniques You Should Try

In Conclusion

Remember, these spending types aren’t set in stone. We all change over time. What’s important is knowing yourself better, understanding your spending habits, and making choices that help you live a happier, healthier financial life.

Money isn’t just about numbers; it’s about emotions, too. And by finding a balance, we can all make our money work better for us. So, which money personality sounds most like you?