A while ago Miranda blogged about the difference in spending styles between herself and her husband and what they preferred to spend money on. This dichotomy in fiscal compatibility was also noted over at Get Rich Slowly in a post discussing a study which found that spendthrifts and tightwads often end up paired with each other–despite their very different attitudes towards money and spending.
I can vouch from personal experience: my spendthrift Mom and tightwad Dad have been married for over fifty years.
Go figure.
As Miranda noted, “Finances, like so much in life, are personal. And there are few things as personal as the way we spend money, and what we spend it on.” Therefore it’s not quite as simple as “spender” vs. “miser”–there’s an entire gamut of spending styles and motivations to be found.
Here are a few other ways of defining your particular spending style:
- Retentive: Well, it sound a little better than “miser” or “tightwad,” doesn’t it? OK, maybe not that much better–but if you’ve been nicknamed “Ebenezer” or you pinch pennies so hard they squeak, you may have crossed the line between “frugal” and just plain cheap. Patience is a virtue, as is saving money–but denying yourself an occasional “splurge” because you can’t bear to part with your hard-earned dollars is no way to live. Remember: there’s only one letter difference between “miserly” and “misery.”
- Inventive: Who needs money when you’ve got talents? Such was the motto of my brother who lived for a good while off the books and under the radar thanks to his exceptional bartering skills. Money is only one form of currency and if you have an in-demand skill (mechanic, massage therapist, plumber, dentist), you can find a number of folks willing to exchange valuable services. Swapping goods is another unique and inventive way to conserve resources. Bartering for free rent in exchange for handyman skills or swapping up the food chain from cell phone to Porsche are tried and true ways of obtaining goods and services. I’m not sure it will work all that well at your local grocery store or with your cell phone bill, but there’s something to be said about more creative (albeit LEGAL) ways to finance your life.
- Attentive: Anyone reading this site certainly aspires to this spending style which requires you to be mindful of your spending habits. It’s not enough to faithfully follow your favorite personal finance blog; you need to put the advice offered into action and be realistic about your income vs. your expenses, make up and stick to a budget and to constantly ask yourself, “Do I really NEED this?” before spending discretionary funds.
- Incentive: I probably fall into this category. If your spending is many times motivated by low prices, good deals, special offers and promotions, then you’re an incentive spender. Perhaps you charge almost all your purchases to rewards cards, buy one ‘cuz you get one free and/or stock up during a sale. There’s nothing wrong with being an incentive spender–as long as you are buying things you actually NEED and not spending just because it’s such a good deal.
- Impressive: Do the words “Rolex,” “Mercedes” and “Montblanc” send a chill up your spine? Do you buy the latest gadgets as soon as they hit the store so you can be the first of your peers to own one? Would you rather own one Chanel or Versace suit rather than a closet full of knock-offs? If your spending is motivated by status, labels and brand names, your style is “impressive”. Or at least that’s what the goal of your purchase is–to impress those around you. To you, a luxury brand is an indication of quality and a good investment–even if it is just an “image” thing…
- Passive: Spending money isn’t an issue with this type–but they do hate shopping. Because of this, they’re willing to pay almost any amount rather than comparison shop or otherwise search for a better deal. They’re motivated by a combination of time (don’t want to waste any) and laziness. They pay higher prices for convenience–whether it’s prepared foods vs. cooking a meal or delivery vs. take-out or overpriced convenience store merchandise vs. planning ahead and buying on sale.
- Impulsive: You know those displays at the checkout? They are designed specifically for the impulse shopper. Those whose spending habits are driven by impulse tend to wait until the last minute, have no set plan or list when they go to a store and have a tendency towards impatience and a need for instant gratification. Lack of impulse control often manifests in frequent buyer’s remorse, closets filled with unused items and money wasted on unnecessary purchases.
- Obsessive: The term “spending spree” was invented for this type of spender. As opposed to the passive spender, they LOVE shopping. It isn’t just a necessity, it’s a hobby. A very expensive hobby because the obsessive spender isn’t content with just browsing or window shopping. Once in the stores, they feel compelled to BUY. And it can go from being a hobby to being a lifestyle and eventually to being an addiction. Does the heroine in Sophie Kinsella’s Confessions of a Shopaholic sound like she was based on you? Time to cut up the credit cards (or freeze it) and go cold turkey…
- Possessive: Once the obsessive shopper passes the point of no return, they reach this stage. Stockpiling and buying in bulk are valid money saving strategies, but you need to make sure you don’t take it to the point where you become an episode of A&E’s “Hoarders: Buried Alive.” Stocking up on discounted canned goods to get you through the winter is acceptable. Cluttered closets, jam-packed pantries and a glutted garage in preparation for the zombie apocalypse is probably overkill–especially if you have more credit card debt than available closet space!
Do any of these spending styles resonate with you? Perhaps you’re a combination of two or three different styles–or have suggestions for another style category all together. Let me know your thoughts in the comments! And after you’ve figured out your spending style, take a quiz to determine your saving style as well.
This is a guest post from Stella Louise, who is the editor of the Savings.com Blog & Save, a lifestyle blog offering shopping advice and money saving tips for the savvy consumer. Although she’s not as an “attentive” spender as she could be, she takes heart in the fact that, in case of a zombie apocalypse, there’s still enough room in her closets to hide…
{ read the comments below or add one }
I do think I have two spending personalities. When it comes to necessity spending, I am a passive one, I don’t usually look at the prices as I tend to shop at my favorite supermarket. But when it comes to luxury spending, I am a mild retentive. I can forego anything that I consider luxury items.
I consider myself passive…although i like this post and all the classifications…great…
I am a combination of Incentive and also Impulsive. I like getting a good deal on anything I purchase, which is very good for saving money. However, sometimes when I see a great deal, I can instantly become an impulsive buyer -which isn’t good for saving money. You should come by my place, I can point to a closet full of baby items that need to be sold on Craigslist.
I used to be an attentive buyer, but my finances have forced me to be an incentive buyer. I don’t buy unless I have to and when I do, I search for a sale or coupon. I just need to get rid of my debt and save for retirement/emergencies.
I fall somewhere between incentive and impressive. I love a good deal but I do occassionally splurge on pricey items.
I am a passive one person in comes of spending my money. I always used to search for great and better deals rather than checking in just one store for example. In that case people can know what are important than other luxuries.