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- There are 5 major financial personality types: big spenders, savers, shoppers, debtors, and investors.
- Your money personality explains why you spend (and save) money the way you do in your day-to-day life.
- Knowing your money personality can help you understand how to make your money work for you, how to save more, and overall how to make smarter financial choices.
The 5 Money Personalities
Which money personality are you?
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As human beings, we have a lot of things in common. You don't have to look further than your family or friend group to know that how we spend (or save) money is not one of them. According to Investopedia, there are generally 5 money personality types, each with its own outlook on finances and way of doing things. Because of these differences, there is no real one-size-fits-all approach for making better financial decisions. Luckily the experts have shared tips for each of the unique group. But first, here are the classifications:
The Big Spender
Big Spenders like to make a statement with their purchases. They are not necessarily materialistic, but they do place a high value in their possessions, often wanting the latest and greatest releases - the latest smartphone, brand-name clothing, high-end vehicles.
Big Spenders are comfortable spending money and would take a big risk on investment if there was a chance it could make them more money. In fact, the act of spending the money that they work hard to earn is one of the things that they enjoy doing the most, even if it adds to their debt.
The Saver
Savers are the exact opposite of Big Spenders. Spending money makes them feel uncomfortable, they always shop for bargains, and they try to save money wherever they can. Savers may very rarely use credit cards to make purchases (or they may not even have a credit card).
Savers are often viewed as "cheap", but this isn't always the case. Savers are generally conservative with the things they purchase and don't tend to take big risks on investments just in case they don't pan out.
The Shopper
Shoppers often develop emotional ties to spending and receiving money. Their mood often dips and increases with their bank account. Shoppers find it particularly difficult to resist spending their money, even if they are buying items they don't need.
Shoppers aren't totally clueless about their debt, they may even be aware of the debt they are incurring but can't seem to separate their emotions from their spending habits.
The Debtor
Debtors don't seem to have emotional ties to their finances. They don't spend to feel better or feel low when they see a low bank balance, they simply don't spend much time thinking about their financial situation.
Debtors may be aware they have debt but may not keep track of what/who they owe. Debtors usually spend more than they earn on a consistent basis, meaning they are constantly at a level of debt even when they feel they are "cutting back."
The Investor
Investors are extremely future-orientated and are consciously aware of their finances, often taking advantage of investment opportunities after carefully weighing their options. Investors typically pay their bills on time, and their spending actions are driven by choices they have given quite a bit of thought to.
Any investment the Investor takes is with the end-goal in mind of earning more money, having better credit, or some other future goal.
How to save more money, according to your financial personality
With every money personality comes a different way you can save!
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Big Spenders: Some of the best things in life are (close to) free.
If you enjoy spending money and have an income that can support your spending habits, you may be missing out on some of the finer things in life by constantly chasing the finer things in life.
Consider some fun alternatives to the high-end purchases or splurges you typically make every month. Find a balance between a spending a lot on things you may not need and spending a little on something that will bring real quality and happiness into your life.
An example of this would be choosing to spend $2000 on a jacuzzi for your back yard instead of spending $300 per month visiting a spa where you use their jacuzzi. It doesn't necessarily have to be about saving money, but it can be about spending less where you can. You may be surprised just how much savings this will lead to in the future.
Savers: Consider quality of life compared to your savings accounts.
Savers are unlikely to fall into financial ruin because they are usually prepared for the unexpected. However, savers tend to put off purchasing things that can make their lives easier (or, in the long run, save them money) because of the price tag.
An example of this could be splurging on a new dishwasher, replacing the old one (which you had to run multiple times to get the dishes clean) with a new one that can save you money on your electric and water bills.
Shoppers: Attach emotion to saving money instead of spending it.
People who consider themselves as shoppers should consider trying to find a balance between the things they enjoy doing and things that will serve their best interests in the future.
Your emotions drive your spending habits, but they can also motivate you to save money.
Consider what emotional value you're able to place on saving money for the future. Saving money for your children's education, your dream home, a nice vacation with your spouse – use the positive emotions that come from these future goals to channel your energy into saving money instead of spending money.
Debtors: Make saving your money as simple as possible.
The tricky thing about having this financial personality is that, if you have a good income and steady work, you may be "fine" for a long time. Your debt may not catch up with you for years, but when it does, it can create a financial crisis. Not to mention any big unexpected expense can put you in financial crisis mode because you haven't prepared for it.
Debtors should consider simple actions that allow you to save money with very little effort, such as setting up automatic deposits from your spending account to your savings account on the day you get paid.
Investors: Balance the "right now" with the future.
Taking risks on big investments that will pay off in the future can be a rush. It's also a good way to make your money work for you instead of simply working for your money, as most others do. Investor personalities should consider how to best balance savings that you can use to make nice purchases today, with investments that lock you in for a certain number of years.
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Image source: Sereno, et al
Mind & Brain
- A powerful MRI combined with modeling software results in a totally new view of the human cerebellum.
- The so-called 'little brain' is nearly 80% the size of the cerebral cortex when it's unfolded.
- This part of the brain is associated with a lot of things, and a new virtual map is suitably chaotic and complex.
Just under our brain's cortex and close to our brain stem sits the cerebellum, also known as the "little brain." It's an organ many animals have, and we're still learning what it does in humans. It's long been thought to be involved in sensory input and motor control, but recent studies suggests it also plays a role in a lot of other things, including emotion, thought, and pain. After all, about half of the brain's neurons reside there. But it's so small. Except it's not, according to a new study from San Diego State University (SDSU) published in PNAS (Proceedings of the National Academy of Sciences).
A neural crêpe
A new imaging study led by psychology professor and cognitive neuroscientist Martin Sereno of the SDSU MRI Imaging Center reveals that the cerebellum is actually an intricately folded organ that has a surface area equal in size to 78 percent of the cerebral cortex. Sereno, a pioneer in MRI brain imaging, collaborated with other experts from the U.K., Canada, and the Netherlands.
So what does it look like? Unfolded, the cerebellum is reminiscent of a crêpe, according to Sereno, about four inches wide and three feet long.
The team didn't physically unfold a cerebellum in their research. Instead, they worked with brain scans from a 9.4 Tesla MRI machine, and virtually unfolded and mapped the organ. Custom software was developed for the project, based on the open-source FreeSurfer app developed by Sereno and others. Their model allowed the scientists to unpack the virtual cerebellum down to each individual fold, or "folia."
Study's cross-sections of a folded cerebellum
Image source: Sereno, et al.
A complicated map
Sereno tells SDSU NewsCenter that "Until now we only had crude models of what it looked like. We now have a complete map or surface representation of the cerebellum, much like cities, counties, and states."
That map is a bit surprising, too, in that regions associated with different functions are scattered across the organ in peculiar ways, unlike the cortex where it's all pretty orderly. "You get a little chunk of the lip, next to a chunk of the shoulder or face, like jumbled puzzle pieces," says Sereno. This may have to do with the fact that when the cerebellum is folded, its elements line up differently than they do when the organ is unfolded.
It seems the folded structure of the cerebellum is a configuration that facilitates access to information coming from places all over the body. Sereno says, "Now that we have the first high resolution base map of the human cerebellum, there are many possibilities for researchers to start filling in what is certain to be a complex quilt of inputs, from many different parts of the cerebral cortex in more detail than ever before."
This makes sense if the cerebellum is involved in highly complex, advanced cognitive functions, such as handling language or performing abstract reasoning as scientists suspect. "When you think of the cognition required to write a scientific paper or explain a concept," says Sereno, "you have to pull in information from many different sources. And that's just how the cerebellum is set up."
Bigger and bigger
The study also suggests that the large size of their virtual human cerebellum is likely to be related to the sheer number of tasks with which the organ is involved in the complex human brain. The macaque cerebellum that the team analyzed, for example, amounts to just 30 percent the size of the animal's cortex.
"The fact that [the cerebellum] has such a large surface area speaks to the evolution of distinctively human behaviors and cognition," says Sereno. "It has expanded so much that the folding patterns are very complex."
As the study says, "Rather than coordinating sensory signals to execute expert physical movements, parts of the cerebellum may have been extended in humans to help coordinate fictive 'conceptual movements,' such as rapidly mentally rearranging a movement plan — or, in the fullness of time, perhaps even a mathematical equation."
Sereno concludes, "The 'little brain' is quite the jack of all trades. Mapping the cerebellum will be an interesting new frontier for the next decade."
