When it concerns money, a person’s personality serves a meaningful role in their financial decision-making. Everybody is unique, and that’s what makes us human, so it really shouldn’t come as a surprise that there are specific types of personalities that are more likely to have money complications than others. It’s difficult to adjust your personality traits, in particular when you’re older, so simply knowing how your personality impacts your financial decisions can help you make better financial decisions down the road. It’s undeniably an important topic to understand, as money problems can intensify quickly and you can find yourself in deep water within the blink of an eye. This post will look into four different types of personalities whom are more likely to have money challenges, together with some suggested ways to improve your financial situation if you fall under one of these personality classifications.
- The Risk-Takers
Fiscally speaking, the higher the risk the higher the reward, but the odds of experiencing high risk success is significantly low. Some folks are born as risk-takers, others develop this personality trait gradually; but in many cases, it’s the thrill of the risk that these types of people enjoy. Statistically, the chances of financial success for the risk-takers are low, so it is essential for these types of folks to diversify their risks to increase their chances of financial success. These folks can make high-risk investments, but they can’t put all their eggs in one basket. A mixture of high-risk and low-risk investments will noticeably improve their financial future.
- The Spenders
Regardless if they’re wealthy or not, the spenders are the types of folks who live life to the fullest without contemplating the financial effects of their decision-making. Whether they’re spending money to have a good time, look good, or to simply please others, the spenders are likely to incur considerable amounts of debt which can take a long time to repay. Consequently, their chances of financial success are significantly impeded. Saving money is the key to financial success, so to prevent overspending, the spenders need to consider putting together a budget to observe their spending habits and at the same time, explore the triggers that cause them to spend their money in the first place. Dealing with the triggers that cause these types of people to overspend is the key to solving the problem.
- The Ignorants
The ignorants are commonly the type of people that are financially uneducated and have no interest in improving their monetary 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 end up in debt. It’s vital that people with this personality trait learn the value of money and how it can be used to provide a better future. As opposed to thinking about now, they should attempt to think about how spending their money now will affect their future. Take an interest in learning how to budget by reading online weblogs and articles. Who knows, they might actually enjoy it?
- The Pessimists
In bleak contrast to the risk-takers, the pessimists tend to pass up on opportunities to make money simply because they fear they won’t succeed. When it concerns large investments like purchasing a house or investing in the stock exchange, the pessimist will avoid taking any risks for fear of losing their hard-earned money. The issue with the pessimists is that by avoiding all risks, they will feel more safe, and this will impair their chances of financial growth and success. An effective solution for the pessimists is to diversify their investments in a wide-range of markets to ensure they have a well-balanced portfolio that is low-risk and offers an opportunity for a good return.
There are certainly many other types of personalities than the ones discussed above, however these are likely the most common personality traits that restricts financial growth and can lead to money troubles. In today’s world, money is without question remarkably important not only for survival, but also to be able to enjoy the only life we have. Just because you have specific personality traits doesn’t mean that you can’t alter some of them with 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, contact Bankruptcy Experts Parramatta on 1300 795 575 for assistance, or visit www.bankruptcyexpertsparramatta.com.au for more information.