Know yourself, know your finances: Which of the 5 money personalities are you? When it comes to money, are you a spendthrift or a fearsome saver? Do you give away all your money or ignore financial requests until they become urgent?
After decades of focusing on financial literacy, it’s clear how we manage our money is more than just access to information. Now, new research has identified five distinct financial characteristics that drive our spending. Commissioned by Te Ara Ahunga Ora (Retirement Commission) for their free, independent personal finance website Sorted, our research includes an in-depth review of research on personality traits, values , and attitudes. We then created an online survey, completed by nearly 500 New Zealanders, that explored how people interact with their money.
New online financial personality test
The study results form the backbone of a new online financial personality test designed to help people understand their financial personality and inform their financial decisions and behaviors.
With New Zealand officially in recession, understanding money management has never been more important. Despite our best intentions, we often find it difficult to make consistent “right” financial decisions, including saving enough, using debt wisely, and following policies. insurance books and KiwiSaver. Do better with our money
According to Te Ara Ahunga Ora, New Zealanders are good at the basics of finances – budgeting and keeping track of money. But we score lower than comparable countries like Canada, Norway, Australia, and Ireland on more advanced finances such as long-term savings. We also lack confidence in our cash flow.
There is growing evidence that personality traits, monetary values, and attitudes each play an important role in helping or hindering us from making “smart” financial decisions. This.
Our attitudes toward thrift, how much we value material possessions, and how much risk we take will all influence the financial decisions we make – and thus, our financial situation.
5 personalities of money
We have identified 5 distinct currencies, each with its own strengths and weaknesses:
Business, social, minimalist, contemporary, and practical.
An entrepreneur is someone who is financially confident, makes plans for the future, enjoys managing their finances, and prides themselves on being money savvy. Their strengths are self-control, financial knowledge, and efficient earning.
An entrepreneur is incapable of making emotional or impulsive purchases. However, their ambitious approach – making money a priority and a symbol of success – may not be compatible with materialism, forcing them to spend money to gain status rather than value or utility. Entrepreneurs benefit from learning about investing and planning for the future.
Minimalists are thrifty, confident in their ability to save and get ahead of their finances. Minimalists enjoy a simpler life, are less concerned with material things, and don’t tend to shop on impulse or on impulse.
Their weakness is that they don’t always make their money work as hard as it can, as they are less likely to take financial risks, even if there is a possibility of a higher return on their investments. they’re private. Low-cost passive investment strategies may appeal to minimalists.
A social person is someone who happily takes risks, is outgoing, and is confident in handling their money. Extroverts are generous, they tend to value material things more than other personality types and tend to live for today rather than plan for tomorrow.
Their high-risk tolerance suggests that some societies can take financial risks recklessly. People in this group who are also impulsive or emotionally prone to buy may find themselves overspending or prone to excessive debt.
However, social sites may prefer to explore active investment strategies and riskier investment classes. Taking calculated risks and building financial resilience are important goals for them.
A contemporary person who dislikes money management and lacks confidence when it comes to financial matters. They are likely to say that they are profligate consumers even though they are less materialistic than others; living for today, they tend to engage in impulsive and generous emotional spending to the point of guilt.
For contemporaries, the focus is on increasing financial resilience by paying off debt and building an emergency savings fund that allows them to share their wealth with others without compromising their financial well-being. main. Working on a financial mindset and general financial knowledge can enable them to gain confidence and save, and then adopt a passive or “set and forget” approach to their financial life. their main.
A practical person is a forward-looking person who is very risk-aware and values money. But they are not confident in managing their money, even though they pay close attention to their financial situation.
As the most introverted personality type, a more ambitious realist may be materialistic, but incapable of making emotional or impulsive purchases a habit. This shows that it is important to build trust and encourage appropriate investment risk-taking. Since they don’t like making financial decisions, it can be tempting to automate bill payments and savings.
Know your money
Each financial personality presents different challenges when it comes to making financial decisions.
Taking the Sorted Money personality test is fun, but it’s also a helpful financial decision you can make right now.
It’s not just about labels. Knowing your financial personality can help you understand your strengths and weaknesses when making financial decisions, giving you the tools to improve your financial resiliency and security 카지노사이트.