Your view on money is shaped by many things - how frugal your parents were growing up, how your partner spends money today, your income level, and your overall financial literacy. But one factor you may not have considered before? Your personality type could explain a lot about your spending and investing habits. One personality test, developed in the mid-twentieth century by Oscar Ichazo, the “Enneagram of Personality Traits” is considered to be “a modern synthesis of a number of ancient wisdom traditions.”1
We think personality assessments are fun! In fact, we can talk about Myers-Briggs Type Indicator® (MBTI®) and Enneagram all day, so we hope you enjoy this blog post. Be sure to scroll all the way down to the bottom to learn more about how we assess your financial personality and integrate that information to create highly personalized portfolios.
What Are Enneagram Types?
There are nine Enneagram types that describe different personality types:
1 - The Reformer
2 - The Helper
3 - The Achiever
4 - The Individualist
5 - The Investigator
6 - The Loyalist
7 - The Enthusiast
8 - The Challenger
9 - The Peacemaker
Each type has unique internal motivations and views that impact and influence their thoughts, feelings, and behaviors. Knowing your Enneagram type is a great way to discover what motivates you. This tool can be especially helpful when it comes to understanding your spending habits - meaning you can potentially use it to help make yourself a better saver and investor.
Investing Habits By Enneagram Type
To determine your Enneagram type, follow The Enneagram Institute’s instructions for how it works, or take a quiz online. Once you’ve determined your own Enneagram Type, refer to the number below.
1: The Reformer
If you’re a reformer, you are rational, principled, purposeful, self-controlled, and a perfectionist. When it comes to spending, you probably love creating a budget so that you know exactly where your money is going. Make sure that even with your budget, you allow yourself to spend money on the things you value most.
2: The Helper
As a helper, you are especially caring and tend to be demonstrative, generous, people-pleasing and even possessive. You want to be very giving with your money to make things better for other people. This is great, but you’ll want to be sure to set limits for yourself and take the time to evaluate the causes to which you are giving.
3: The Achiever
Achievers are success-oriented and tend to be adaptive, driven, and image-conscious. With that being said, if you’re an achiever you are likely to be a status spender. This means that you like to buy trendy things and use these purchases as a way to boost your image. Tracking your income and saving money for the future is important for achievers to remember.
4: The Individualist
Individualists are more sensitive and withdrawn, but also expressive and dramatic. They can even be self-absorbed and temperamental. If you are an individualist, you may find yourself spending based on emotions. It could cause you to overspend on impulse buys, so try out journaling, drawing, or listening to music as different ways to express yourself without spending money.
5: The Investigator
As an investigator, you are intense, perceptive, innovative, and secretive. You love to find great deals and sales when you shop. You will want to be cautious though, and ask yourself if you really need it or if it’s just a really good deal. Remind yourself that not spending money at all will save you even more than spending money on something just because it's on sale.
6: The Loyalist
If you are a loyalist, you are committed, engaging, and responsible but also anxious and suspicious at times. When it comes to spending, you’re more of a saver. Having an emergency fund for unexpected events will be helpful in the long run, but also make sure you take the time to relax knowing that you are prepared for the future.
7: The Enthusiast
As an enthusiast, you’re busy, fun-loving, spontaneous, versatile, distractible, and a little scattered. This makes it easy for you to make impulse buying decisions often. To combat these impulse buys, ask yourself questions to figure out the “why” of each purchase. For example, say to yourself, “Will this purchase bring me joy? If so, for how long?”
8: The Challenger
You are powerful and dominating if you are a challenger. You are also confident, decisive, willful, and confrontational. You are so independent that when you spend, you may find yourself stockpiling items. Remind yourself that it’s okay to be vulnerable and ask for things from others when you need them.
9: The Peacemaker
You’ve probably already guessed that if you are a peacemaker, you are a people-pleaser. You are easy-going, receptive, reassuring, and agreeable. You may find yourself making purchases that will please others, or you consistently ask for others' approval before buying things. Make sure that you are making purchases that match up with your priorities since it is your money after all.
What is Your Financial Personality Type?
These traditional personality assessments were not developed to evaluate your personality type in regards to your money and investing habits specifically. However, based on science developed by Harvard, M.I.T., and Wharton academics, every element in our financial personality assessment is designed to draw the strongest positive connection between you and your money. It's like an Enneagram test for your financial life.
We believe every investor has unique financial goals, and many also express the desire to align portfolios with their moral compasses and personal feelings about the economy or markets. As such, you deserve a portfolio and financial plan that aligns with your unique personality, ethics, and values.
In fact, before we start the investment process we look to understand what drives your financial decisions along these dimensions
- Purpose: Utilizing socially responsible investing (SRI) to eliminate companies violating your values
- Faith-Based Investing: Ensure elements of your faith are reflected in your portfolio
- Touch: Invest in companies with strong Environmental, Social, and Governance (ESG) factors such as diversity and inclusion
- Viewpoints: Have exposure to where you feel the innovation economy is headed such as Blockchain, Genomics, Self-Driving Cars, AI and Robotics, etc
- Safety: Balance risk vs. growth to be aligned with your financial personality
If understanding your Financial Personality is interesting to you, we invite you to take our assessment take our assessment here. It's short (~3 minutes) and completely free. We will share the results with you regardless, but if you would like to dig deeper to understand how we use this information to build personalized portfolios, we would welcome the opportunity to speak with you.
Todd Smurl, CFA
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten and Integrity Financial Planning, LLC. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.