This article is brought to you by CreditRepair.com.
While no two people will make the same exact choices when it comes to money, identifying your basic money style can be extremely helpful. That’s why we work with our long-term friends at CreditRepair.com The Financial Diet came up with the Money Personality Matrix. Maybe you don’t fit perfectly into one category and fall somewhere between Super Scrimper and Intuitive Spender — the important thing is to be self-aware about your money habits and what motivates you to make good choices for your future. And no matter your money personality, if you’re struggling to get your credit score to where you want it to be, CreditRepair.com’s team can help. Below, writer Savanna Swain-Wilson shares the rules she lives by as a self-proclaimed “Intuitive Spender.”
Like many other TFDers, I’m a firm believer that building a stable financial future starts with understanding myself and my relationship with money. This is why I was thrilled to learn about the TFD Money Personality Matrix.
Upon taking their quiz, I learned that I most closely resemble the personality of the Intuitive Spender. This essentially means that, when it comes to managing money, I’m not a fan of (or particularly good at) sticking to rigid budgets and would much rather rely on my gut instincts to make purchase decisions. It also means that I appreciate convenience and tend to live with more spontaneity than structure. In fact, I find the best strategy for me to manage my money is through not planning how I spend every dollar.
One might think that this sounds like I give myself permission to be deliberately reckless. And I get it. Spend what you want when you want to spend it? Isn’t that something only people with tons of disposable income can do?
Hear me out when I say that after years of alternating between hyper strict, cash-only diets and zero-sum spreadsheet budgets — both of which left me feeling like I had no real control over my finances — I’ve found that a flexible, intuitive approach to managing money works for me. Of course, a big part of being an intuitive spender means that my greatest challenge is knowing how to self-regulate my spending. In the past, I’ve gotten myself into some serious debt due to unchecked habits, and I know well that sticking to my goals means holding myself accountable.
In order to keep myself in check, I’ve adopted a basic guidelines that allow me to spend spontaneously and responsibly:
1. I simplify my budget by basing it on regular and unpredictable expenses.
As a freelancer, my income fluctuates from month to month. It’s necessary to use simple budgeting systems that I can customize as I go. One strategy that works for me is to separate my monthly expenses into two basic categories: fixed and variable.
My fixed expenses are things that I pay for every single month like rent, taxes, savings, utilities, and my phone bill. This clocks in around $1,700 to $1,900. I then mentally subtract $50 from whatever’s left as a cushion. Whatever is left becomes my monthly allowance for variable expenses. I divide that figure by four to get an idea of how much I can spend per week. Most recently, that allowance was $272. I’m free to use it however I want — and I mean that.
You see, when I was a teenager with an allowance, I had no trouble staying within my set limit for the week. I didn’t break down my money into separate categories like entertainment, clothing, and coffee, because I knew every week would be different. I had one basic amount that I learned to work with every week based on my own habits.
Now, I totally understand that this model would not work for everyone. But this way, I feel less like I’m micromanaging every dollar and more like I actually have a say over what I buy. I also like that it allows room for flexibility, because I don’t always buy the same things every month. Sometimes I’ll go for weeks without buying any coffee, other times, I’ll buy a latte three times a week. By working with one simple figure for my allowance (and keeping that $50 cushion at all times), and regularly checking on my spending in my budgeting app, I’ve given myself a limit without feeling restricted.
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2. I prioritize saving by using apps that allow me to “set it and forget it.”
Although I can spend within my means easily, I’ve struggled remembering to save. This can present a problem because having a strong safety net is non-negotiable if you don’t want to plan every dollar you spend.
In the past, I had trouble with saving because I viewed it as the direct opposite of spending. If spending money was fun, saving was a chore. It also didn’t help that manually transferring $100, $200, $400, or $600 from my checking account every time it was payday served as a constant reminder of money I couldn’t spend. Most of the time, I’d transfer it back to checking anyway.
The solution? I set up automatic transfers so I don’t have to think about it. Instead of choosing some arbitrary number based on what I think I’m supposed to be saving, I came up with the figure based on my own long-term goals. Right now, my priority is to get my non-emergency savings to reach five figures before I turn 30, so I have my bank set to transfer $150 a month. I also use Qapital, an app that automatically rounds up my purchases to the nearest dollar and transfers it into a high-interest account. This allows me to save without feeling like I’m cutting into my precious spending allowance.
3. I plan for the unexpected by investing in my future.
It turns out the secret to being spontaneous with money is actually having a plan. Of course, that begs the ever-important follow-up question: how do you plan for things you don’t know are going to happen?
For me, it’s through combining a little bit of imagination with the practical power of sinking funds. If you’re unfamiliar, “sinking funds” are essentially a type of savings account that you set aside for special purposes. The idea is that you contribute small amounts to each fund throughout the year to prepare for bigger expenses like holiday gifts or taxes.
Currently, I have several of these funds in place for different loosely defined purposes: Travel, Concerts, Fun, Computer. These side stashes of cash (which are separate from my regular, adult savings and my emergency fund) have given me the freedom to make many unplanned purchases without guilt. Last year, for instance, I was able to take an impromptu trip to Disneyland while visiting my sister because my special “fun fund” had over $500 in it. The best part? I didn’t have to dip into my monthly allowance.
I’ve also been known to turn to my stash for other spontaneous purchases, like a book that sounds interesting or tickets to a surprise show by my favorite artist. In the same way that emergency funds are built on the possibility of something going wrong, my “future fun” fund is built on the possibility of good opportunities popping up in my life.
I like to think of it as the opposite of carrying a credit card balance, because it’s prepaying for good things before they happen, rather than after. it’s a great strategy for me because even if these hypothetical fun things don’t happen, it’s not like I’m losing anything by setting aside some extra money.
4. I don’t treat credit cards as a safety net.
A credit score has so much power over your ability to buy what you want when you want it. When you’re at the mercy of minimum payments that only seem to grow larger with variable interest rates, there’s very little room for any spontaneity in your life. Most of the time, every dollar you make has been accounted for before the paycheck even hits.
I sure used to love credit cards when they got me things I couldn’t afford, but wow did I hate them when they locked me into years of debt. Thankfully, I learned from my past mistakes to stop treating credit cards like my ticket to free-for-all spending or my backup plan for when I spent all my cash. But that doesn’t mean that credit can’t support my drive to buy things without worry. My CapitalOne Venture card, for example, has reward miles that I can use to partially fund future travel expenses.
For now, I strictly use my card to pay for recurring fixed expenses, like Spotify, which I cover immediately thanks to autopay. I only use it for an unplanned purchase if I have enough money in my slush fund to immediately cover the balance in full. This commitment works for me because I can rebuild my credit score safely while keeping my splurge spending in check.
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5. I recognize the difference between being spontaneous and being impulsive.
In the past, I used to justify my reckless spending behaviors by saying things like, “It’s okay that I bought $80 worth of drinks on my credit card last night, I was feeling spontaneous! No regrets!”
It wasn’t until I started really paying attention to my feelings that I realized the words “spontaneous” and “impulsive” are not the same. Being spontaneous, in its simplest form, means going with the flow. By that definition, if I’m being spontaneous with my money, it means I accept that sometimes I’m going to buy non-emergency things I want on a whim. When I make the choice to be spontaneous, it’s always a positive thing because it comes from me being totally aware and in control of my finances.
Impulse buying, on the other hand, is mindless. In my experience, it’s usually a response to feeling like I have no control over my emotions and actions.
One way I’ve learned to distinguish between the two in real life is like this: I’ve noticed that for me, impulse buys often begin with me using the phrase, “Screw it!” whereas spontaneous purchases are the things that begin with a totally confident, “Heck yeah!”
A “screw it” decision might look like this: It’s Friday and I just got paid. My check is $200 less than last month. A college friend calls me because they haven’t seen me in a while, and they want to celebrate by going somewhere fancier than usual. I say yes to all of this, even though I have lunch with other friends later that week. I go to the fancy dinner and swipe my credit card to pay because that #FridayFeeling has me excited. At that point, since I’m already using the credit card, I might as well order the appetizer, too!
On the other hand, a “heck yeah” decision looks like this: All year long, I set aside a few dollars cash into an account for fashion splurges. One day, while shopping for other items, I come across a pair of $80 wedges I immediately fall in love with — they’re cute, and I know they’ll go with a million other things in my closet. I look at my fashion splurge fund and notice I have enough to cover the shoes without dipping into my budget for the month.
Anytime I’m about to buy something I didn’t plan for, I pause and ask myself — Is this a “screw it” or a “heck yeah moment?” If it’s the former, I take a step back and try and think about the consequences. If it’s the latter, I go forward with confidence.
6. I reflect and practice gratitude often.
I used to have this mentality that if I overspent in my budget, I needed to be “punished” and make up for it. The voice in my head would say, “Oh, you went over your eating out budget by $160 in December? I guess you’re not going to restaurants for the next few months!”
Obviously, this tactic failed because it was totally unrealistic. But it was also problematic because it made me associate certain purchases with negative feelings, rather than tackling my relationship with spending.
Now, I take the time every week to reflect on my relationship with money by writing brief notes about my purchases in a gratitude journal. Sometimes I’ll write about tangible items I purchased, like the mattress topper that cost $100 but makes me feel like I’m sleeping in a hotel bed. Other times, I’ll write about things I was able to do. This week, for instance, I’m writing, “I’m thankful I got to write this article for TFD because it allowed me to reflect on my habits and earn some money for savings.”
I’ve found this simple practice encourages me to be more mindful of my cash flow without thinking of my purchases as hard numbers. If I notice that I’m spending more than usual on something like chai lattes, I try and get to the bottom of why. Was it because I felt sad? Lonely? Trying to get my mind off something else? Once I’m able to make a mental note on these behaviors, I can work on changing my habits from the inside out rather than the other way around.
But above all, the greatest benefit of this practice has been that it’s taught me to actively appreciate what I have. Every time I write in my journal about the things I’m grateful for, it’s a subtle reminder that if I’m going to be spontaneous with money, I should spend it on something worth remembering.
Anyone can make room for a little spontaneity in their life.
Being intuitive isn’t an exact science, but it’s certainly helped me make more informed financial decisions for my own life.
In our data-driven, productivity-obsessed society, spontaneous spending can sometimes feel like an act of rebellion. To be spontaneous is to “throw caution to the wind” and “live on the edge,” a risky behavior that can only lead us astray from our goals. But I’ve learned it doesn’t have to be so black and white. You can still be financially responsible and trust yourself enough to make money decisions that are right for you, even if they’re made in the moment.
Because at the end of the day, it does not matter how close you are to the edge of the cliff. As long as you have a parachute on your back, you have nothing to fear.
If you’ve been struggling to grow your credit score, check out CreditRepair.com to learn more. They can help you work to repair, build, and maintain your credit score by working directly with the credit bureaus to challenge any unfair, inaccurate or unsubstantiated items on your credit report, and teaching you how to understand both your own score and the rating system.
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