When it involves money, a person’s personality serves a major role in their financial decision-making. Everyone 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 complications than others. It’s tough to modify your personality traits, particularly when you’re older, so simply being aware of how your personality influences your financial decisions can help you make better financial decisions in the future. It’s surely an important topic to understand, as money difficulties can magnify quickly and you can find yourself in deep water within the blink of an eye. This blog will explore four different personality types whom are more likely to have money problems, along with some recommended ways to improve your financial situation if you fall into one of these personality categories.
- The Risk-Takers
Fiscally speaking, the higher the risk the higher the reward, but the possibility of experiencing high risk success is substantially low. Some individuals are born as risk-takers, others develop this personality trait gradually; but most of the time, it’s the thrill of the risk that these types of people enjoy. Statistically, the probability of financial success for the risk-takers are low, so it is vital for these types of folks 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 mix of high-risk and low-risk investments will considerably improve their financial future.
- The Spenders
No matter if they’re wealthy or not, the spenders are the types of individuals who live life to the fullest without thinking about the financial repercussions of their decision-making. Whether they’re spending money to enjoy themselves, look good, or to simply please others, the spenders are likely to accumulate enormous amounts of debt which can take a very long time to repay. Subsequently, their opportunity of financial success are noticeably restricted. Saving money is the key to financial success, so to avoid overspending, the spenders need to consider setting up a budget to track their spending habits and at the same time, review the triggers that cause them to spend their money in the first place. Addressing the triggers that cause these types of people to overspend is the key to solving the problem.
- The Ignorants
The ignorants are typically the type of individuals that are financially uneducated and have no interest in improving their fiscal skills. The ignorants may have a similar frame of mind to the risk-takers in that they want to ‘live life to the fullest’ and consequently, spend all of their money and end up in debt. It’s important 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 aim 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 typically pass up on opportunities to make money simply 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 challenge with the pessimists is that by avoiding all risks, they will feel more protected, and this will impede 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 personality types than the ones discussed above, however these are likely the most common personality traits that impedes financial growth and can cause money issues. In today’s world, money is without question exceptionally important not only for survival, but also to be able to enjoy the only life we have. Just because you have particular personality traits doesn’t mean that you can’t alter some of them over 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, reach out to Bankruptcy Experts Dandenong on 1300 795 575 for assistance, or visit http://www.bankruptcyexpertsdandenong.com.au for additional information.