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What's your money personality? Find out

Last updated on: April 19, 2011 16:06 IST

What's your money personality? Find out

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Ramalingam K

Everyone relates to money in a different way. How good is your relationship with money? Is there a way to improvise your relationship with money? Many money problems or issues arise out of the way you look at money.

Here's a guide to understand the various relationships you have with your money that decides your money personality.

Unfortunately or fortunately this money personality tells your investment style.

There are 5 major groups: the trendy spenders, the great shoppers, the savers, the wise investors and the debtors. Identify yourself with one of these money personality groups and find out how you can improve:

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Ramalingam K, an MBA (Finance) and Certified Financial Planner, is founder & director of Holistic Investment Planners (P) Ltd (http://holisticinvestment.in)


Photographs: Dominic Xavier/Rediff.com
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1. The Trendy Spenders

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They believe in experiencing the expensive and trendy things of life. They would love possessing the latest cars, the latest design in clothing, and latest in technology. This satisfaction lies in spending excessively with the least thought of being in debt. They would however not fear high risk for high returns in investments.

Some valuable investment advice for this money personality

Once you have identified yourself, next you should embrace a suitable savings and investment plan to suit your personality with a few changes.

The Trendy Spenders need to realise they need to spend less and save more. This involves saving on expensive things that they may not use much in future with reducing unnecessary expenses on fuel, housing, travel and living. They need to consider saving to invest for the long term, and not taking a blind/uncalculated risk in high and quick return investment helps.

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Image: The Trendy Spenders

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2. The Great Shoppers

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They love shopping not necessarily for trendy things, but for emotional satisfaction. Their addiction makes them overspend, sometimes even on things that they may not even use in future. The Great Shoppers may invest on a regular basis; also investing windfall amounts like an inheritance or bonus.

Some valuable investment advice for this money personality

The Great Shoppers need to realise credit cards are for emergencies. Lavish spending could wreck long term financial goals, while careful thought before spending with savings helps to meet their long-term financial commitments. So as to avoid emotional spending they need to create a conscious spending plan.

They need to make their mind to look at the benefits of long term investing instead of the satisfaction they derive out of emotional shopping.

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Image: The Great Shopper

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3. The Savers

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The Savers believe in frugal spending, deriving great satisfaction from saving every penny and earning interest from savings. This conservative saver just believes in subsistence and is frugal in lighting and heating bills. They never believe in the use of credit cards. They are also careful in taking risks for investments.

Some valuable investment advice for this money personality type

Savers need to cultivate the realisation that moderation is the rule of life. Savings along with having enjoyable and good experiences are important. So they need not be just penny wise or frugal. They need to look for better return in their investments.

They need to understand that the high returns come with only high risk. If one is not taking risks in investments then the safe returns will not be sufficient even to beat inflation.

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Image: The Saver

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4. The Wise Investors

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The Wise Investors consider spending and investment as integral parts of life. They believe that conscious investment of money could earn good returns and make their money work best for them. They aim at caution in taking risks with a stable attitude irrespective of their financial standing and aim at long time financial self-sufficiency.

Some valuable investment advice for this money personality type

The Wise Investor is the ultimate group of money personality. My congratulations and best wishes to them for their great money management and investment planning. However they should also not stop learning newer ways to increase the value of their investments. Be focused and avoid distraction.


Image: The Wise Investor

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5. The Careless Spenders or Debtors

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The Careless Spenders or Debtors are those people who are constantly in debt due to unwise budgeting practices. These money personality types lose track of their spending, get into deep debt and are not known to take advantage of tax breaks and investment opportunities.

Some valuable investment advice for this money personality

The Careless Spenders or Debtors need careful budgeting to become debt free. Getting advice from a professional would help. They could focus on paying back loans carrying high interest and take advantage of tax deductions on loan payments.

Creating a debt payoff plan will help them in having a financial recovery. In addition, they could plan investments with higher return and set up a plan to return loans carrying low rates over a period of time.

The last advice for all money personalities

I am sure that knowing your follies and ways to improve must have made you a wise money manager. Self-awareness with keeping track of innovations would help you gain from your investment experiences and emerge out rich at retirement.


Image: The Careless Spender or Debtor

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