Thursday, March 24, 2005

What's Your Money Personality?

The following feature is posted on under “mind”. I thought that you would enjoy it.

The 9 Money Personalities

Do your friends call you a cheapskate, or is shopping a form of therapy for you? Do you invest conservatively, aggressively, or not at all? "Becoming aware of your money style motivates you to take steps in the direction of financial health," says psychologist Kathleen Gurney, PhD, author of Your Money Personality: What It Is and How You Can Profit From It (Financial Psychology Corporation), and the subject of our interview in "Mind Over Money," page 102 in our April 2005 issue. Pick the profile below that best describes you and note the action Gurney recommends.

The Hunter
You could be one if

You're highly educated and hold a well-paying job.
You've been known to dip into your 401(K) account to "invest" in a pair of Jimmy Choos.
You have a recurrent nightmare of becoming a bag lady.

Action: Your confidence will soar once you learn to manage, and not just earn, your money. Forget taking a class; you're smart and educated enough to learn the basics on your own.

The High Roller
You could be one if:

Investing is an extreme sport for you: It's all about the thrill.
You own a vintage Porsche and/or diamond stud earrings.
Your friends call you scatterbrained.

Action: Focus, focus, focus. If you have six items on your to-do list, pare it down to three. Set realistic goals, and you'll feel less frustrated.

The Producer
You could be one if:

You're too busy earning a living to make money.
Your idea of investing is buying a weekly lotto ticket.

Action: Boost your financial I.Q. by taking a course at your community college. Financial education can be tremendously empowering once you understand the basics.

The Entrepreneur
You could be one if:

You make a mint, but what really drives you is passion for your work.
Everyone you know considers you a workaholic.
You have a taste for wine and food, drive a great car, and pay for it all in cash.

Action: You need balance, not money. Take time out for a well-earned massage, or rent a DVD.

The Optimist
You could be one if:

You're nearing retirement and eager to enjoy your hard-earned savings.
You let your accountant make all your financial decisions. "Out of sight, out of mind" is your philosophy.

Action: Reality check: If you're 65, you could live to be 90. You may need to invest more aggressively, curb your spending, or consider other tools to generate more income.

The Safety Player
You could be one if:

Risk makes you queasy.
You don't trust the stock market.
You consider financial planners to be one step above plankton on the evolutionary tree.

Action: You may be averse to risk, but you're actually taking a huge chance by not keeping up with inflation. Visit a financial planner who can answer your questions at an hourly rate. (Write to us at: or visit and click on Advisor Match.

The Perfectionist
You could be one if:

You're astute and analytical.
You're so afraid of making a mistake that you avoid making financial decisions at all—even small ones.

Action: Use your analytical skills to assess a financial decision quickly. Haul out the old yellow pad and divide it into plus and minus columns. More debts than assets? Your decision is clear. Now act.

The Achiever
You could be one if:

You're married and a high earner.
Emerson's Self-Reliance is your manifesto.
Monitoring your portfolio is like watching grass grow.

Action: Curb the control freak in you and get a second opinion—perhaps from your spouse, who may be feeling left out.

The Money Master
You could be one if:

You accumulate money quickly.
You're not afraid to seek advice from a financial planner.
You invest for the long term.

Action: You're on the right track to financial security, but sometimes life calls for a little spontaneity. Allow yourself to splurge now and then.

Note: Because the money personality you most closely identify with is determined by 13 personal financial traits, you may find yourself in more than one profile. For more information on your money personality and the traits that drive your money management style, visit

Wednesday, March 16, 2005

What is Financial Psychology?

Have you ever wondered why money seems to work so well in some people’s lives and so destructively in others? Why some people control money while others allow it to control them? Or why some of us can manage it so effortlessly to fulfill life’s plans and goals, while others never stop to question how they want it to serve them?

Questions like these are not typically explored. Why not? I believe it’s because the answers do not lie in cold financial facts. One must look at both the financial and psychological factors involved in money matters to make sense of why people do what they do with money. This column will do just that.

For most of us, money and our feelings toward it tend to veer to extremes. We love money or we hate it, we fear it or we worship it—but we certainly never ignore it. And yet, we know so little about why we experience these emotions toward money and the effects they have on our very existence.

As a psychologist specializing in money-related issues, I confront these money emotions every day. I have worked with hundreds of men and women from all backgrounds and income levels: company presidents who make million dollar-decisions in the board room but make disastrous personal financial decisions; couples who never cease arguing over “my”, “your”, and “our” money; parents who know better but spoil and indulge their children, never giving them a chance to enjoy the connection between effort and reward.

I’ve learned that most of us fail to realize how our feelings about money affect our financial habits and the degree of satisfaction we get from the money we have. There is an inseparable link between our unconscious attitudes about money and the way we relate to money in our lives. Like it or not, money can enhance happiness and prosperity, or it can destroy them. No one simply drifts to the pinnacle of success—you have to climb.

Not only do we have a physical self, an emotional self and a social self, but we have a financial, or money self. This money self influences the way we interact with our money. You have a healthy money self-concept when you know how you affect money and how money affects you. You have a healthy money self-concept when you like how you deal with money more than you dislike how you deal with money. If you have a negative money self-concept, you can alter your attitudes and formulate a new money style that provides richness instead of deprivation.

To learn more go to