When it involves money, a person’s personality serves a meaningful role in their financial decision-making. Each person is unique, and that’s what makes us human, so it really shouldn’t come as a shock that there are certain personality types that are more likely to have money issues than others. It’s tough to modify your personality traits, especially when you’re older, so simply having an understanding of how your personality affects your financial decisions can help you make better financial decisions down the road. It’s without a doubt an important topic to understand, as money challenges can intensify rapidly and you can find yourself in deep water within the blink of an eye. This article will look at 4 different personality types whom are more likely to have money complications, together with some recommended ways to improve your financial situation if you fall into one of these personality classifications.
- The Risk-Takers
Economically speaking, the higher the risk the higher the reward, but the likelihood of experiencing high risk success is significantly low. Some people are born as risk-takers, others develop this personality trait gradually; but most of the time, it’s the thrill of the risk that these types of people revel in. Statistically, the likelihood of financial success for the risk-takers are low, so it is vital for these types of people to diversify their risks to increase their chances of financial success. These individuals can make high-risk investments, but they can’t put all their eggs in one basket. A mix of high-risk and low-risk investments will substantially improve their financial future.
- The Spenders
Whether they’re wealthy or not, the spenders are the types of people who live life to the fullest without taking into consideration the financial effects of their decision-making. Whether they’re spending money to have fun, look good, or to simply please others, the spenders are more likely to accumulate significant amounts of debt which can take a long period of time to repay. Consequently, their opportunity of financial success are considerably impeded. Saving money is the key to financial success, so to avoid overspending, the spenders need to consider setting up a budget to observe their spending habits and at the same time, study 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 issue.
- The Ignorants
The ignorants are normally the type of people that are financially uneducated and have no interest in improving their financial skills. The ignorants may have a similar way of thinking to the risk-takers in that they want to ‘live life to the fullest’ and as a result, spend all of their money and wind up in debt. It’s crucial that folks with this personality trait learn the value of money and how it can be used to provide a better future. Instead of thinking about now, they should aim to think about how spending their money now will affect their future. Take an interest in learning how to budget by reading online blog posts and articles. Who knows, they might actually enjoy it?
- The Pessimists
In bleak contrast to the risk-takers, the pessimists have a tendency pass up on opportunities to make money purely because they’re afraid they won’t succeed. When it relates to large investments like purchasing a house or investing in the stock market, 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 secure, and this will impair their opportunity of financial growth and success. An ideal solution for the pessimists is to diversify their investments in a wide-range of markets to make certain that they have a well-balanced portfolio that is low-risk and offers an opportunity for a good return.
There are naturally many other types of personalities than the ones specified above, however these are likely the most common personality traits that inhibits financial growth and can result in money issues. 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 particular personality traits doesn’t suggest that you can’t modify some of them over time to be more financially responsible. If you need any assistance with your finances, or you’ve found yourself facing a mountain of debt due to overspending, get in touch with Bankruptcy Experts Darwin on 1300 795 575 for assistance, or visit www.bankruptcyexpertsdarwin.com.au for more details.