Understanding Your Financial Personality is Key to Achieving Financial Wellbeing

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Understanding Your Financial Personality is Key to Achieving Financial Wellbeing

Achieving financial fitness and having the financial resilience to take on life’s challenges is key your financial wellbeing. But getting there requires a commitment to your financial goals and also, understanding your financial personality. So, while financial wellbeing isn’t necessarily difficult to achieve, setting out a path to get there is where the difficulty can arise for some people. The following actions are designed to ease the journey.  


Like fingerprints, we all have different financial personalities. Within the same household, there can be significant variances in how different members of the same family relate with money. Where both parents may have been savers, their children might be spenders, and vice versa. There are five basic personalities:

1.The Big Spender – The Big Spenders like to make social statements by having the latest car, clothes, or phones. They use money for love and attention and are the main representatives of consumerism.

2.The Investor –  People is this category love the risk, trade frequently and have enough confidence to think they will beat the market. Investors have the most conscious attitude towards money and try to put their money to work.

3.The Ostrich – Someone who would rather bury their head in the sand than organize their finances. They fail to make long-term investment decision, and leave everything to the luck of faith

4.The Saver – Money represents security. Hate taking risks and hesitate investing, or even spending

5.The Debtor – Broke before the end of the month. These type of people are called debtors and they are not trying to make a statement with their purchases, nor they shop to cheer them up. They simply spend too much and don’t put much effort in keeping their financial assets in order.


Some people don’t know where their money goes each month. This can most often be as a result of poor financial awareness and low spending visibility. For example, while some people can be really good at tracking their spending by way of budgeting tools, others lose all sight of their money and just spend!

So, to make things a little easier, especially for those that want a lot more sight of where their money goes, use a budgeting tracker (available HERE). This way, at least when it comes to setting financial goals, those can be based in financial reality.  


Make sure your financial goals are specific, measurable, actionable, realistic and time-specific. In other words, make sure they are aligned to your financial reality. Don’t plan to save a million Euro over the course of the next year when the most you can scrape together right now is a €100 per month. Instead, look at reasonable goals for the short-term, which you can achieve in a year or two; the mid-term, which will take two to five years; and the long-term, which you expect to take five years or more.

For each goal, list out how much money you’ll need. Next, divide that number by the total number of months it will take to reach it. Then, you can manage your personal finances, including your monthly spending and saving to ensure you are in the best place to reach your financial goals.


People often ask about how much they should be saving each month. To this question, there is no straightforward answer. However, there is a pretty universal rule called the 50:30:20 Rule that can be a really good guide.

It basically says that each month, one should look to be spending about 50% of income on household ‘needs’. This includes the cost of a mortgage (or rent), food, heating etc. Next, it allows for about 30% of the household income to be used on ‘wants’. Basically,’ wants’ are a little luxury and fun. And finally, there is the 20% and this is where savings come in. However, with inflation surging, some flexibility will be needed to keep spending and saving on track.

The 50:30:20 Rule is an excellent general guide. Even if it does not fit seamlessly into your monthly budget, you can always adjust it. Just remember, if you can save some money each month, you are doing fantastic!     


Credit is another word for taking on debt. And while in an ideal world you might like to save to achieve all of your financial goals, it simply will not be possible all of the time.

Personal loans, education loans, mortgages, car finance loans and even credit card debt can all serve a useful purpose. For example, a mortgage can help people buy a home. A car loan can be a useful way of buying a car and perhaps a route to a better paying job. Credit card debt might be a way of buying goods online but it is important to pay it off quickly.  

When it comes to debt, it is important to understand the full cost of using it and also, the implications of not paying monthly payments on time.


Your financial wellbeing is about creating that balance between living today and having the means to pay your way in the future. Once you’ve got an emergency savings fund and you’re making progress towards short and medium-term goals, it might be time to think about diversifying your savings through other types of investments. As you may already know, most savings in Ireland today attract very little by way of interest earned on those savings.

If you are planning to invest, you need to factor for risk. Diversification is a proven strategy to mitigate and manage risk over time…as well as increasing your options to earn a satisfactory return on your investment.


There is nothing more permanent than change. However, when it comes to your financial wellbeing, you can plan ahead and build resilience. To do so, you will need to understand your financial personality, identify what your financial resources are and then, put pen to paper, set out your financial goals, get started and remain committed!

Frank Conway is the Founder of MoneyWhizz and Qualified Financial Adviser.

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