Are You a Spender, a Saver, or a Worrier?

How we manage money can be broadly categorized into three main tendencies: Spending, Saving, and Worrying. We all mix and match these three tendencies to varying degrees, based on our current priorities and needs. However, each of us has a primary money personality that we use most frequently. It is a good idea to know the strengths and weaknesses of each. Which one best describes you?

The Spender

Spenders are enjoying life, and all the goods it has to offer. They are usually generous to friends and family, and you might find them covering the costs for large meals and parties. Gifts are generous and often elaborate. They tend to focus on the present, with little discussion about the future.

Most people assume The Spender is a bad money management style, but this is not necessarily the case. The spender plays a very important role, sharing wealth, rewarding others for their efforts or achievements, and often plays a leadership role in the community. The key to success with this money management style is to do it without going into debt.

The most effective way to manage this style is to have a cash only rule - all spending must be done with cash. Once the money is gone, the spending is finished. Paying for items with cash is a traditional way to show wealth, and is coming back into vogue. By never using debt to fund your spending, the relationship between the reward and the cost is immediate and obvious. 

The Saver

Looking forward to a large goal, such as starting a family, going to school, or purchasing a vehicle are all activities that will trigger The Saver money style. Savers questions all non-essential purchases and put as much money as possible into savings.

Social pressure typically frowns on The Saver, who is often termed a 'miser'. It is assumed that people who are saving are cheap, and that they judge anyone who is spending money on seemingly frivolous goods or activities. This is not necessarily the case.

Many people are too ambitious with their saving plans, leaving no funds available for discretionary spending. This creates a feeling of self-deprivation that is often unnecessary. Keep the plan reasonable and build in room in your saving plan for some fun. 

The Worrier

The Worrier is someone who refuses to look at the details of their income and expenses, but instead spends their time worrying about money. They may receive calls from bill collectors, and are often surprised at the state of their finances. By refusing to look at the details and create a plan, they escalate their own anxiety; they genuinely don't know where they stand, and have no plan.

This style often coincides with periods when expenses are increasing faster than income. Most people have a good sense of where they are financially. When the news is not good, they stop looking at the details, and start to worry instead.

When you notice this happening, take charge! Be brave and face the reality of your finances. Through proper management and common sense, it is possible to manage a sudden drop in income or rise in expenses without creating any long-term damage.

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This post was written by Carol Francois. Carol is a freelance writer, with training in accounting and financial management. Based in Canada, she has written articles on a wide range of financial topics, from personal budgeting tips to selecting the best money management software product.

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