This article brought to you by TransUnion.
One thing that I learned early on in creating The Financial Diet was how much your individual personality type changes how you handle money. Even just within our immediate team of five women, we have wildly different personality types, which means each of us came to the site with our own unique perspective (and baggage). Personally, I tend to be a very overconfident person, which through my entire life has led me to have the twin financial bad habits of “always believing I can make more money tomorrow” and “justifying completely unjustifiable purchases because of it.” But that’s just me! I know that there are tons of people who have the opposite problem — avoiding and refusing to spend money on things they know they need until, say, something breaks in the middle of (over)use.
Essentially, no matter what your personality type — and its inherent flaws — chances are it has a huge impact on how you handle money. And while it’s not a perfect system, we have come up here at TFD with seven core personality types we see every day in our community (and even in our team), and the money behaviors that best help counterbalance them. With help from our friends at TransUnion — the best place to find out your credit score, learn how to improve it, and track your credit progress — here are six financial habits you should be adopting, based on your personality type.
Note: This quiz is in no way scientific — just for the purposes of this post and just for fun!
Personality Type: Avoidant
Habit: Aggressive Calendar Use
One of the most common personality types we see on our site (particularly when it comes to finances, or anything “administrative” in life) is Avoidant. Essentially, these are the people who tend to look away from anything that might make them feel uncomfortable, anxious, or under pressure — so, basically anything to do with money. As someone who was very much this way when I had ruined my credit and had very little in my bank account, I can confirm that using sites like TransUnion to effectively rip the band-aid off are super helpful. For example, when I would force myself to log on, see my score, and address what I needed to do to improve it (I literally used to have my partner do it with me to hold me accountable), I found that I immediately felt better about everything else. But today, as someone who can still definitely have avoidant tendencies, I have found that aggressively making use of calendars, reminders, and lists is the best way to counteract it. I literally have anywhere between 20 and 40 reminders set throughout my day, including yelling ones like “WORK ON [INSERT IMPORTANT THING HERE], YOU IDIOT” for stuff I have been putting off. Does my calendar look a little bit crazy to the outside world? Probably. But does having reminders for every little administrative task I have in my life, up to and including going over my account statements, help me to stop avoiding them? Absolutely. The more you can act as your own mom, filling your own life up with appointments, reminders, and to-do lists, the more you can stop being your own worst (and most procrastination-prone!) enemy.
Personality Type: Hesitant
Habit: Specific Savings Accounts
Another thing we see all the time on TFD is people who know that they need to be making certain purchases, and have the financial ability to do so, but put it off because they feel hesitant to spend any money. Sometimes this comes from a vague sense of scarcity, like they’ll never have the money again, but often it just comes from the unpleasantness of having to pull the trigger and actually see that number in your account drop. We see people who will continue to use the same threadbare, pilled winter coat year after year, even though they could afford to get a new one, because they are just that resistant to spending money — even on things they know they will get tons of use out of. For this, we recommend creating dedicated savings accounts for the purchases you know you need to make, but are going to have a hard time pulling the trigger on. For example, if you are several years into your window AC unit and find that it barely cools your apartment anymore, start saving little by little in winter for the new one, so that by the time the $400 purchase rolls around in May, you’re not going to feel terrible for actually buying it — you are going to feel empowered and given permission by the fact that it is literally, specifically what you were saving up for with that account.
Personality Type: Overconfident
Habit: Structured Savings
While avoidance was definitely a big part of my worst money habits, overconfidence has to have been the defining characteristic that led to my financial downfalls, and it’s something we see every day on TFD. Basically, the pervasive advice of “don’t save money, earn more,” combined with the natural tendency to envision Future You as a much more successful person than Today You, makes for a personality type that is always ready to justify another purchase, another indulgence, and another reason to skip savings. And I found that the only thing that got the ball rolling when it came to defeating my overconfident habits and forcing savings was to totally automate the process. When my check dropped, before I could see it, it would go straight into my savings account — automatically deducted (which you can set up with most bank accounts). Same with my one-off job checks: in fact, I used to make my partner deposit them in savings for me, just to be sure I wouldn’t have them on my debit card and justify that extra spending. Yes, having to use a third party to help make sure my money actually made it into savings at first was not the most grown-up or empowered-feeling thing. But I learned (in large part from ruining my credit), that the worst thing one can do when it comes to getting better with money is letting the perfect be the enemy of the good. And if your tendency to not save is stopping you from building a future, well, dammit, it’s okay to let someone (or something, like an automated bank transfer) help you.
Personality Type: Guilty
Habit: Frequent Check-Ins
One of the personality types we see on TFD that I frankly cannot relate to is the Guilty Spender. These are the people who maybe make a purchase or a financial decision, unlike the Hesitant person who cannot make them at all, but who are wracked with guilt after the fact. This could be from growing up in an environment of scarcity, or even just naturally tending towards a guilty conscience when it comes to anything that might be indulgent (or even just done for oneself, something we commonly see when it comes to mothers spending on something that isn’t for their families). The point is, if you are finding that your money choices often come with strong, negative feelings of guilt afterwards, we recommend setting up frequent check-ins with yourself: with your account statements, with sites like TransUnion that allow you to analyze your credit history and score, and with your partner if they are someone with whom you share finances. Basically, forcing yourself to frequently confront that, hey, things are actually going well allows you to make those decisions without the constant guilt. Sure, you can indulge your desire to analyze your spending or payment history line-by-line, but you must use that knowledge to relieve yourself of the guilt associated with spending money you can afford to spend.
Personality Type: Consumerist
Habit: Social Media Cleanses
It’s no surprise that, if you are the type of person given to spending a lot of time on lushly-visual, addictive social platforms like Instagram or Pinterest, you are going to find yourself wanting a lot of what you see. Because these photos are not just about a well-appointed living room or the perfect pair of suede ankle boots. They are about the unspoken promise that a better life — and being a better person — await you if you just click this one affiliate link and buy this one product. We have published stories of women who have gone into debt or spent into the thousands to keep up with lifestyles they see on social media, who have transformed the person they are in an attempt to look like someone else’s filtered highlight reel. And for that, we have heard over and over that the only effective solution is cleansing social media. First, and at the very least, remove every account that is leading you to spend based on what you see. But beyond that, consider going a month without using any of these platforms, combined with going on a spending freeze, to see how it feels when you are not constantly being fed images of what to buy (and not constantly finding yourself in retail stores as a pastime). You don’t need to go cold turkey forever, but if you are susceptible to spending while scrolling, giving your mind a break from the constant stream of “Buy This Now” is one of the best things you can do for yourself, because the consumerist personality isn’t really about the money. It’s about the aspiration to be someone you’re not, and you’re a lot happier with yourself when you’re not constantly seeing something “better.”
Personality Type: Emotional
Habit: Leaving Cards at Home
There can be a whole host of emotions that lead us to spend our money in unfortunate ways, but the key to this personality type is you are more likely than most to spend because of how you feel, not because of what you need. Celebrating a victory? Time to treat yourself to a new pair of shoes. Just broke up? Time to park yourself at the bar with a super-fancy cocktail and a dozen oysters to yourself. Feeling bored? Why not go to the boutique and pet the cashmere scarves (and take one home with you)? Anxious about an upcoming interview? Trading in your laptop will make you a better professional. These are all the patterns of the person who spends as a result of their emotional state rather than their rational needs. And if you want to break yourself of this habit, by far the most effective deep-end-of-the-pool strategy is to leave your cards at home, particularly when you’re in environments or times in your life when you are likely to feelings-spend. We see readers who even literally freeze their cards in blocks of ice — whatever gets them to not rack up charges they can’t pay back in time. The point is, even if you only take up this habit for a few months to get used to not turning to swiping the card as a way to swipe away the bad feelings, an emotional problem needs a non-negotiable solution, and not having your cards on you to mindlessly spend is one of the only ways to ensure that you’re not going to get the best of yourself. You’ll always have those emotions, of course, but this cold-turkey strategy is a good way to learn how to ride them like the waves that they are without immediately buying yourself a brand-new life raft.
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