Are You a Spender or a Saver?

We often think our financial habits are shaped over time, through experience, education, or perhaps trial and error. But a compelling study from the University of Michigan suggests that our instincts around money may begin far earlier than we realize.

In the study, a group of five-year-olds were given tokens they could either spend on small toys or save for a larger reward later. While watching the children make decisions, the researchers tracked their emotional responses – facial expressions, body language, and verbal cues.

What emerged was a clear pattern: some children lit up at the opportunity to spend, while others became anxious at the thought of parting with their tokens.

And interestingly, these behaviors didn’t necessarily reflect what they saw at home. They appeared to be part of each child’s natural temperament.

These early traits often carry into adulthood, influencing how we manage money, make decisions, and feel about spending or saving.

But just because these patterns run deep doesn’t mean they’re permanent. Even if you’re someone who instinctively spends every dollar or debates whether to splurge on brand-name toothpaste, your habits can evolve. With a bit of self-awareness and some intentional steps, it’s possible to find a healthier balance that supports your goals and still lets you enjoy life.

If You’re Naturally a Spender…
You may find it easy to enjoy your money, whether it’s dining out, taking trips, or making spontaneous purchases. That enjoyment is important, but without guardrails, it can lead to regret or financial strain later on.

How to create balance:
• Pay yourself first. Automate transfers to savings or investment accounts before you have the chance to spend.
• Set clear goals. Saving becomes easier when you’re working toward something meaningful – a future trip, home project, or early retirement.
• Build in “fun money.” Create a spending category that lets you enjoy today guilt-free while staying on track for tomorrow.

If You Tend to Be a Saver…
For some, saving provides a sense of control and comfort. But even with strong finances, it can feel difficult to spend, especially in retirement when you’re no longer earning an income. The shift from saving to spending can create stress, even when spending is entirely appropriate.

How to loosen the reins thoughtfully:
• Assign purpose to your spending. It may feel easier to spend when it’s aligned with what’s important to you – treating family, supporting causes, or investing in experiences.
• Practice small indulgences. Start with modest purchases that bring joy. Over time, this can help shift your mindset.
• Trust the numbers in your financial plan. Knowing your plan supports your lifestyle can help you feel more confident spending what you’ve saved.

Finding balance begins with understanding your tendencies. From there, small, intentional steps can help you build habits that align with your goals and allow you to enjoy the money you’ve worked hard to save.

Why do we plan?

Knowing where you are translates into knowing where you're going, and we hope to provide every client with the trust and confidence to navigate through the waters of their financial lives.

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