How Do You Spend Money? Your Spending Personality Type

How Do You Spend Money? Your Spending Personality Type

It’s a natural impulse to compare ourselves to others (Is her computer faster? Does her salad have more croutons? Does she, uh, make more money than we do?) Over and over, readers will ask not just, “How am I doing?” but, “How am I doing compared to everyone else?”

They want to know if they have more or less money saved up than other people their age, how their spending habits compare, and whether they are bigger spenders or savers than other people. So, we answer. Let this information quench your curiosity and guide the way you view and treat money in the coming year.

How Does Your Net Worth Compare to Others With the Same Age and Income?

Your net worth is the full amount of money, investments, and property you’ve accumulated, minus your debts. This CNN Money calculator can show how you measure up to your peers, grouped first by age and then by income. For example, median net worth for people between the ages of 25 and 34 is $8,525, whereas that number jumps to $51,575 for the 35 to 44 age group (we’re thinking student loans). Play around and see what you find.

How Does Your Spending Compare to the Average?

According to U.S. nationwide numbers, the average household spends about $6,400 on food, $16,900 on housing, $1,700 on clothing, and $7,700 on transportation per year. Did your household spend more or less than the average $2,600 on dining out? To track down your spending and compare, visit the LV Budgeting Tool. While you’re going through your annual spending, figure out what percentage of your income you’re spending on what. For example, Americans spend about 34% of their budgets on housing, but we actually recommend trying to spend less than 30% of your annual income on housing. Compare the chart showing how the average American household divides its spending to the chart with how we recommend dividing your income. Now, look at your own numbers. Are you on track?

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How Does Your Savings Personality Compare?

To find out whether you’re generally a super saver or a big spender, take our quiz.

1. Do you ever go into debt in order to buy something other than food, medicine, and basic living expenses?

a. Never.
b. Sometimes, but I try very hard not to.
c. I don’t make a lot of money, so if I want something, I don’t usually have a choice.

2. When you compare your annual expenses to your annual income, how do you net out?

a. No matter how high or low my salary is, I make sure to only spend what I have income to pay for, plus some money left over for my savings…even if that means pushing for a raise or living somewhere less nice.
b. About even. I have the income to buy pretty much everything I buy, but I don’t really have anything extra to save up.
c. Salary’s low, rent’s expensive, and I don’t really know what to do about that…so yeah, I often spend more than I make.

3. What’s the main reason you shop?

a. I shop when I need something specifically. I thought that was the point?
b. Although I try to shop for needs, I do sometimes browse and buy things that are wants, instead. Regardless, I try to make sure that it’s something I’ll actually wear in the future and that it fits in my budget.
c. It makes me feel good and it’s a bit of a hobby. I go with friends for fun, when I’m in a bad mood, or simply when I feel like it.

4. At what point do you start buying things that you want (rather than the absolute necessities)?

a. It’s sometimes hard for me to remember to buy non-necessities because there are so many other long-term goals I could be scrimping and saving for.
b. Once I have a solid emergency fund, am out of debt, and have the necessities I know I need.
c. Umm, when I want them.


5. Where are you putting money for savings?

a. I try to keep as little as possible in my checking account, but I have a whole careful plan set up, in which I put money into different accounts—some is invested for retirement, some for long-term goals like grad school or a house, some for future children’s college funds, and the money I might need in a year or two is carefully tucked into CDs of different lengths.
b. Into my emergency fund, if I don’t have about eight months of living expenses saved up yet. Otherwise, some goes toward retirement, some goes toward other goals like buying a home, and the rest I enjoy.
c. What savings? I just put extra money in my checking account. But I don’t often have extra money.

6. Your favorite black t-shirt is getting kind of ragged, and you find a pretty good replacement on sale at the store. What do you do?

a. Figure that my current shirt will do the trick for a while yet, and wear it until I absolutely must replace it.
b. Go ahead and replace my old shirt.
c. Buy the new shirt in a bunch of different colors, even though black is the one I need the most. After all, once I’ve found a shirt I like, I might as well go all in.

7. Your best friends from college are planning a group vacation to the Mediterranean, but you don’t really have the extra cash on hand to go. Next step?

a. Gracefully decline. I’d love to go, but I can reunite with them some other time.
b. Make an effort to go out less for a while, save up all the extra money I have, and start a special vacation fund immediately. I’ll go if I meet my savings goal, and I’ll try my hardest because I haven’t seen all these friends at once in a long time.
c. Divert money from my retirement savings or take a loan if I have to. This trip is simply not to be missed.

8. You’ve saved up money and have plans to buy your dream car this weekend. Two days before you go to the dealership, you find out that you’re going to be laid off. What do you do?

a. Settle for a cheaper model. I may never get that dream car, but this is still an improvement over the clunker I’m currently driving.
b. Hold off until I find another job—but once I find that new job, I’ll get that car of my dreams.
c. Get it anyway. I’ve wanted this so badly!

9. You recently spent $300 on a new coat which you needed, but now you see that a Chanel lip gloss is actually on sale (and that pretty much never happens). You don’t really need another lip gloss for $40. What do you do?

a. I don’t actually need it, and if I let myself splurge randomly this once, that opens the doors to other splurges. I’d skip it.
b. I’d ask myself whether I’d rather get the lip gloss instead of $40 in other purchases, like four movie tickets or two restaurant meals. If I’d rather have the lip gloss than those other things, I’d go for it.
c. Even if I’ve been spending a lot lately, seriously, it’s just $40. I’d get it.

10. How often do you buy new clothing?

a. I try to only buy new things to replace other items or when I really need something.
b. Every season, I just buy a small item or two so that I can keep up with the trends.
c. I’ve got to keep up with new styles, so I buy as much of a new wardrobe each season as I possibly can.

SCORING:

Give yourself 0 points for all answers marked "a," 5 points for "b" answers, and 10 points for all "c" answers.

0 to 25 points
Super Saver
Just remember that being a super saver isn’t always, well, super. Although we want to encourage you to save enough money to live comfortably, the key phrase there is live. If you live to save rather than saving to live, you may be missing out on some of the biggest benefits of financial empowerment. Keep up the good responsibility, but don’t be afraid to spend a little money when it’s something you can afford that will enrich your life.

30 to 70 points
The Moderate
No comment on your politics, but your spending habits are comfortably middle-of-the-road. You’re good at remembering that money is made for enjoyment, at the same time as you’re careful to keep your spending in check and your saving responsible. Don’t let yourself become complacent—always think about your purchases, check your budget to make sure you’re on track, and stay the great course you’re on.

75 to 100 points
Big Spender
Saving and spending responsibly doesn’t mean pulling a Buddha; the idea is to save well so that you can spend well. We know that sometimes it’s hard to live the life you want when you aren’t making as much money as you might like, but the most important thing is to never spend more than you make. Seriously. As tempted as you may be to buy luxury items, remember that being debt-free and having your finances in order can actually be one of the biggest luxuries ever.

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