These 4 Money Personalities Dictate Our Spending Habits. Which One Are You?
Brad Klontz, Psy.D., CFP, is a clinical psychologist turned financial planner who has spent years studying the beliefs and assumptions that motivate his clients' relationships with money. In time, Klontz has calculated the four money "scripts" that drive everyone and written a book about how to optimize them, called Wired for Wealth: Change the Money Mindsets That Keep You Trapped and Unleash Your Wealth Potential.
According to the financial psychologist, identifying your money script is the first step in questioning, and ultimately transforming, the habits that are holding you back in the financial department.
What type of spender am I?
In order to really explore your financial life, you need to think about more than just how you're spending your paycheck. "You have your financial behaviors above the surface of the water," Klontz says, comparing our tendencies to an iceberg. "Underneath you have all this subconscious stuff clanking around in your head that's probably been put there from people generations ago."
Each money script is supposed to tease out some of those deep-rooted beliefs about money. See which one you identify with most right off the bat, then take this quiz to confirm:
This is just what it sounds like: people who avoid money. They have negative beliefs around wealthy people and think that money usually leads to corruption.
This one describes people who think that having more money will solve their problems and make them happier. "It's associated with a whole range of things, including workaholism and more shopping," Klontz adds.
"This is the belief that connects your self-worth with your net worth," Klontz says. People with this script might tell people they make more than they do, only buy things that are new and flashy, etc.
If you're money vigilant, you have a certain amount of anxiety about the future, which drives you to always have something set aside for a rainy day. "These people are more focused on saving and would be a nervous wreck if they didn't have money saved for an emergency," Klontz says, adding that they also tend to be a bit more secretive about money and how much of it they make.
OK, so I know my money script—now what?
Unsurprisingly, money vigilance is considered the most desirable script in the long run, and Klontz says most of the wealthy people he's worked with fall into the vigilant camp. Don't worry if you fall into one of the other three, though, because it's possible to inhabit different scripts with time.
In order to move past your current script, you need to consider why you're there in the first place. What ingrained thoughts are holding you back? What under-the-ice associations with money are getting in the way of a brighter financial future?
"Ask how these beliefs are playing out in your life. Are they helping you? Are they hurting you? Putting it into context is hugely powerful," Klontz says. He then recommends taking the inquiry a step further and questioning why you started to have these beliefs in the first place. If you grew up in a less wealthy household, for example, research shows you're probably more likely to equate money with status. If you grew up with a lot of money but had a parent who was constantly working, you might practice more money avoidance.
This sort of thinking can lead to some pretty intense revelations: "People don't really talk about this stuff, so a lot of times it's brand-new information for them, so they can have a lot of discoveries," Klontz says.
Once you consider the narratives keeping you in your money script, you can start to move past them by exploring other ways of being. "If you're looking to make more money, try to find someone in your life right now who is a step or two ahead of where you are. Almost like an amateur psychologist or anthropologist, try to pick their brain. How do they think about money? What's it like for them?"
Here's to being a little more open, and a little more vigilant, in 2019.