Did you know that your upbringing greatly influences your spending habits?
Experts tell us that how we handle money and its meaning to us goes back to our upbringing.
People have different attitudes toward money, such as, accumulating wealth for power and status, for security or for thrill and adventure.
The four types of family money cultures are:
1) Cautious and Conservative – This group needs lots of information and takes risk management seriously. They move slowly and watch every penny.
2) Stable and Reliable – They avoid spur-of-the-moment decision and like to maintain the status quo. They honor tradition and want each person “fit the mold.”
3) Extroverted and Interpersonal – This family dynamic upholds harmony, fosters interpersonal relations and believes in nurturing others. They have a tendency not to adhere to a rigorous structure or processes when dealing with their family finances.
4) Dominant and Entrepreneurial – This family dynamic is based on results and outcomes. They move quickly when convinced that it is the right direction they should be going. They usually have strong opinions and have high regard for power and control.
A family may fall into one of these categories or a blend of two of the categories on spending habits.
How does that affect you as an adult?
Interestingly, two things tend to happen – You tend to imitate your parents or you do just the opposite! If your parents were very frugal, you may also be frugal. Or, you may be just the opposite and buy whatever you want, when you want it!
Your past financial history doesn’t have to dictate your future. Have a family conversation about money, spending and saving. You and your partner may have very different views of money and how to spend it and save it.
If you are solely responsible for the money decisions in a single-person household, financial information will be your friend.
Speaking from experience, working with a financial planner or advisor is well worth the time and money!
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