When it relates to money, a person’s personality represents a substantial role in their financial decision-making. Every person is unique, and that’s what makes us human, so it really shouldn’t come as a surprise that there are various personality types that are more likely to have money problems than others. It’s hard to change your personality traits, in particular when you’re older, so simply being aware of how your personality impacts your financial decisions may help you make better financial decisions in the future. It’s definitely an important topic to understand, as money challenges can compound quickly and you can find yourself in deep water within the blink of an eye. This article will investigate 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 types.
Fiscally speaking, the higher the risk the higher the reward, but the likelihood of experiencing high risk success is substantially low. Some folks are born as risk-takers, others develop this personality trait over time; but for the most parts, it’s the thrill of the risk that these types of folks relish. Statistically, the likelihood of financial success for the risk-takers are low, so it is crucial for these types of people to diversify their risks to increase their likelihood of financial success. These people can make high-risk investments, but they can’t put all their eggs in one basket. A blend of high-risk and low-risk investments will significantly improve their financial future.
- The Spenders
No matter if they’re wealthy or not, the spenders are the types of people 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 accumulate massive amounts of debt which can take a long period of time to repay. Due to this fact, their opportunity of financial success are noticeably inhibited. Saving money is the key to financial success, so to prevent overspending, the spenders need to consider setting up a budget to keep track of their spending habits and at the same time, inspect the triggers that cause them to spend their money in the first place. Facing the triggers that cause these types of people to overspend is the key to solving the problem.
- The Ignorants
The ignorants are usually the type of folks that are financially uneducated and have no interest in improving their fiscal skills. The ignorants may have a similar reasoning to the risk-takers in that they want to ‘live life to the fullest’ and because of this, spend all of their money and end up in debt. It’s essential 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 try to think about how spending their money now will have an effect on 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 tend to pass up on opportunities to make money purely because they’re afraid they won’t succeed. When it comes 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 concern with the pessimists is that by avoiding all risks, they will feel more protected, and this will restrict their opportunity of financial growth and success. A good 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 of course many other types of personalities than the ones discussed above, however these are probably the most common personality traits that impairs financial growth and can cause money troubles. In today’s world, money is without question incredibly 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 imply that you can’t reshape some of them with time to be more financially responsible. If you need any assistance with your finances, or you’ve ended up facing a mountain of debt as a result of overspending, speak with Bankruptcy Australia on 1300 795 575 for assistance, or visit www.bankruptcy-australia.net.au for more details.