If you had to describe your money management style, would you say you’re more “miserly” or more of a “spend thrift”? Does it take a crow bar to separate you from your money even for things you need or does money burn a proverbial “hole in your pocket” never staying in your grasp long enough to be counted? Please find below a scale developed by Scott Rick, Cynthia Cryder, and George Lowenstein* that places you along the tightwad – spendthrift continuum. Are you a tightwad or spendthrift – let’s just see.
So, how did you do? Don’t forget to reverse your scores for questions 2b and 3 (for example, 5=1, 4=2, 3=3, 2=4, 1=5). Use the following norms to peg where you fall along the Spendthrift-Tightwad continuum. The average score on the ST-TW scale is 14.38.
Spendthrift-Tightwad Scale Norms
Tightwads = 4 to 11
Unconflicted = 12 to 18
Spendthrifts = 19 to 26
The $64,000 question in all of this is which money management style will bring you the most happiness? The answer is neither. Both are obsessions with money and will not lead to lasting happiness. The middle ground (Unconflicted) is where you want to be when it comes to money management, and really most things in life. I seem to remember reading somewhere that people should practice “moderation in all things”. Not too tight with our money but not too loose either.
And, this is what makes achieving financial peace so difficult. If you squirrel away every penny you ever made and spending even a dime makes you sweat, you will be just as unhappy as the spend thrift. Moderation in all things – indeed. Your thoughts?
* Scott I. Rich, Cynthia E. Cryder & George Lowenstein, “Tightwads and Spendthrifts,” Journal of Consumer Research, 34, 2008, 767-782.