Do you like to give gifts that come from a special store, have a brand name, or “look” expensive? Have you ever spent money you couldn’t afford just to keep up with an image?
If so -- you’re not alone. According to financial educator Sybil Soloman, you display one of six common “Money Habitudes.” This particular Habitude is status focused: money helps you present a positive image.
And having this information might help your financial planner do his or her job better.
A key part of any planner’s job is to help clients articulate, set, and achieve financial goals. But it’s almost impossible to do that without understanding the context and experiences that each client brings to the table.
Much of that context is qualitative. Two clients of the same age and same net worth might have completely different views of money. A planner needs to figure that out before it’s possible to make a proper recommendation.
But talking about money isn’t easy. And part of the challenge for planners is to get clients to open up about a topic they may feel vulnerable discussing.
In 2003, Solomon created the Money Habitudes card game to make that discussion easier. Clients are shown a deck of cards with statements on them. These cards are split into six Habitudes: Status, Security, Spontaneous, Giving, Carefree, and Planning.
A few examples include:
“I know the difference between what I want and what I need.”
“I think things will work out, so I don’t worry about money.”
“I rarely buy things unless I can pay them off right away.”
There are 54 statement cards, and clients place them into three categories: “That’s Me!” “That’s Not Me!” and Sometimes, it depends…” based on how much the statements resonate with their feelings.
Once a client completes the whole deck, they’re encouraged to focus on the “That’s Me!” category. The “Habitude” with the most cards in the “That’s Me!” pile is considered to be the client’s dominant habitude...though most people clients will have a mix of all six.
How Do I Acquire A Money Habitude?
Like lots of other things, your Money Habitudes are at least partly borne out of your previous life experiences. Maybe your parents had two conflicting ways of thinking about money. Maybe you had a significant life event that changed your money-related feelings. Maybe you grew close to someone with a distinct money style and took on that style yourself.
As Solomon writes: “There is no perfect combination of Habitudes. However, too much of any single Habitude will probably mean there are challenges; missing any Habitude may indicate a need for more balance.”
So What Does The “Status” Habitude Mean? Is it Good? Is It Bad?
You might have a dominant “Status” Habitude if you resonate with these statements:
“It seems most people I know are better off than I am.”
“I will pay more for a brand name that others will recognize.”
“I feel I should pay the bill when I eat out with others.”
“I think people will only like me if I am generous.”
“I will hide the fact that I have money problems.”
There are advantages and disadvantages to each Habitude, and the “Status” Habitude is no exception. Someone with strong “Status” qualities might make generous donations, give unexpected gifts, and be attentive to what is important to others.
That same person, however, also might feel stress to keep up with others, feel entitled to special treatment, or lack money saved for the unexpected.
If you’re worried that Status plays too big of a role in your money life, Solomon suggests the following tips:
Set up a budget. Use direct deposits to ensure there’s money to pay bills and save for the future.
Don’t shop with people you want to impress.
Make a gift list with price limits for each person. Look for sales. Don’t buy extra gifts with the savings.
If you have debt, talk to a professional to learn how to pay it off.
The Bottom Line
No matter what your money Habitude, the most important thing is to recognize the patterns in your behavior and to try to get comfortable talking about them. Solomon developed her game in order to “help people achieve their goals and enable better communication between couples, families, and business partners.”
Money, as we know, can be a major point of stress in romantic relationships. At Capital Asset Management Group, we believe that “the biggest hurdle most couples will face isn’t managing their day-to-day finances. Rather, it’s managing their finances in a way that ensures both parties can achieve their dreams.” You can read more about our take on money and couples here.
If reading about Money Habitudes has inspired you to think more deeply about money and your financial goals, we’d love to talk to you about it. So much of money is emotional, and it can help to have a second set of eyes and ears as you consider where you want to go. A great place to start is by filling out our Goals Driver Questionnaire.
We hope to talk to you soon!