Updated: Nov 7
Traits Linked to Going Broke
Are you creative, curious, and sympathetic? It turns out that you are more likely to go broke in retirement.
According to Catey Hill, studies show that there is a direct relationship between personality traits and how fast folks blow through their retirement savings. The main reason being that many of the identified traits result in impulsive financial behavior or an increased likelihood of withdrawing from their retirement account(s) to help others.
Remember the 5-year old marshmallow experiment? Even at a young age, you can project which of those kids are more likely to spend all of their retirement funds!
The following list includes personality traits that are linked to retirement financial issues:
Open to new experiences: – Creativity – Imaginative – Adventurous – Curious
More agreeable: – Sympathetic – Caring – Warm – Helpful
More neurotic: – Nervous – Worried – Moody – Lacking calm
Negative Emotions: – Afraid – Scared – Upset – Frustrated – Guilty – Ashamed – Bored – Hostile – Jittery – Nervous – Sad – Distressed
But there are two traits that might result in retiring rich: – Conscientiousness – Financial self-efficacy
These traits refer to organized, thorough, hardworking, cautious people who have a sense of resilience and control over financial situations.
The moral of the story? Self-awareness and education are key to financial freedom.
If you are aware that you have one or more of the high-risk traits linked to going broke, then be mindful of it when making financial decisions.
Additionally, the more educated and involved you are in actively managing your finances, the more aware you are of your financial big picture. One tool that can help is the Portfolio Shepherd APP which puts financial literacy at your fingertips. Sign up today to be the first to know when it launches!
Do you have some of the high-risk traits? If so, what is the impact on your finances? Let us know in the comments!