How to Change Your Financial Personality

by Mike Holman

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This post is written by Jonathan from Master Your Card.  I’ve been reading this blog for a while and it’s pretty good.

Everyone has a financial personality.  Some people go to the extreme with
their financial personalities, such as people who save habitually and
never spend a dime on anything they don’t absolutely need while other
people on the other side of the spectrum go through money like it’s water.
Most of us fall in between these two extremes, leaning in one direction
or the other as far as Spender or Saver.

Your financial personality has a lot to do with your potential for being
financially successful.  Of course, even the idea of being financially
successful varies widely depending on your financial personality.  Someone
who is more of a Spender may define financial success as having enough
money to live comfortably from one paycheck to the next, while a Saver may
define financial success as having a year’s worth of expenses in the bank.

How do you know when you need to make an attempt at changing your
financial personality? The answer is simple: you need to switch it up when
it’s just not working for you.  Perhaps you constantly run out of money
and can’t cover all your bills, or maybe you have a fair amount of money
but you’re too terrified of parting with your money to make an unnecessary
purchase.  Either way, when it’s just not working anymore, it’s time for a
change.

Recognize the need for change.

The first thing you need to do is to actually recognize that it is time
for a change.  One of the best indicators is that your money just isn’t
working for you like it should.  Do you make a decent wage, yet never seem
to have any money to spend? Do you have an impressive amount of money in
the bank
, yet you can’t compel yourself to buy something nice? It’s time
for a change.

Figure out what your financial personality is right now.

It’s probably obvious to you what your financial personality is.  Some
people, however, never make the connection that perhaps they have a hard
time saving money (or spending money) because that’s just the personality
they have adopted over the years.  Behavior can be changed, but the
behavior has to be recognized first.

Force yourself to do something contrary to your current financial
personality.

One of the hardest things about changing behavior is to actually give it a
try.  If you’re a Spender, stash your spending money for the week away in
a savings account and keep it there.  If you’re a Saver, go buy something
that you don’t actually need.  The behavior may seem strange at first, but
you need to prove to yourself that it can be done.

You may not need to change your financial personality.  On the other hand,
if your financial personality causes you grief then it is indeed time for
a switch.  You don’t have to go from one extreme to another.  You might
want to just add a little Spender to your saving tendencies, or just add a
little Saver to your spending tendencies.  It doesn’t have to be a
dramatic switch, but if it makes your life a little more enjoyable (and
your money a little more useful) then there is no reason why you shouldn’t
give it a try.

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{ 4 comments… read them below or add one }

1 Four Pillars

Thanks for the post Jonathan.

I know I’ve wavered back and forth between “saver” and “spender” – right now I’m definitely a bit too far in the “saver” mode but the trick is to loosen up the wallet a bit – but not too much.

2 Jonathan @ MYC

4P, thanks for the opportunity to write it :)

What makes you think you need to ‘loosen the purse strings’? Still need to do that Christmas shopping?

3 Four Pillars

I don’t do much Xmas shopping but I still have to do a bit!

I just mean spend a bit more in general – we don’t spend much at all.

4 Andy @ Retire at 40

I used to be a spender (with a few savings) but now I’m a saver (with a few spendings). I think you’re right, we do flit and flirt between them but I now know I’m on the right track and probably won’t ever become a spender again.

I’ve seen the light on the opportunities and the happiness not relying on material possessions gives me and the freedom keeping hold of my money also returns.

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