One of several “learning opportunities” that my wife & I experienced together as newlyweds was managing OUR money together as a couple. While we had taken personality quizzes to help us understand whether we were introverts or extroverts and the best career fields for our personality type, we didn’t do much in regards to learning how our personality affected our personal finance temperament. In other words, why we manage money the way we do.
A few months after we married, I discovered a book designed to help engaged and newlywed couples learn how to manage money together. That book is Money & Marriage by Matt Bell. He echoes a lot of the same principles as Dave Ramsey and you can currently buy a used copy on Amazon for a penny. It might be a great wedding gift idea for the lovebirds in your life.
While Mr. Bell’s book is 200-pages in length and discusses everything from joint bank accounts, writing a will, and sample budgets for household incomes ranging from $30,000 to $150,000, the portion of the book I want to discuss is his section on the four different personal finance temperaments.
Related Article: If you are married and trying to make some common financial goals, check out The Simple Dollar’s guide, Financial Incompatibility: Steps for Healing Marriages Torn by Finances.”
The Four Temperaments
The temperament classification system isn’t a new invention like the Myers-Briggs or DISC tests (I enjoy both of these). It was first developed by Hippocrates in 370 BC and has since been refined by other great thinkers. Overall, there are four temperaments and each person has a primary and secondary.
Choleric: Short-tempered, Blunt & Direct, Type-A
Sanguine: Optimistic, Outgoing, Everybody’s Friend
Phlegmatic: Calm, Predictable, Committed, Hesitant to Initiate Change
Melancholy: Analytical, Planner, Perfectionist, More uptight than a Phlegmatic
This is just a very brief description of each temperament to help give you a general idea of what might be your primary and secondary traits. We will delve further with each type in the following sections.
In the book, there is a short quiz that is broken down into boxes A,B,C, and D. The quadrant with the most boxes checked indicates your primary behavior.
Choleric Money Management
As mentioned before, cholerics know what they want in life and are quick to let others know when their expectations are not being met. When a choleric creates a financial goal, they target it like a heat-seeking missile and will not stop until they accomplish the goal. Remember this group is probably the most visionary and they will move mountains to accomplish a goal.
When a choleric creates a financial goal, they target it like a heat-seeking missile and will not stop until they accomplish the goal.
While never giving up can be a good thing, it can be easy for a choleric to not include their spouse in the process due to focusing on accomplishing the task instead of consulting with other people. This can sometimes cause tension if the spouse feels “left out” or ignored, even when the choleric does it unintentionally as he or she finds out about decisions made afterwards or the choleric turns into a workaholic to meet a financial goal because they cannot sleep peacefully until it is completed.
It’s not all bad, financially. Cholerics can be excellent negotiatiors when haggling with salespersons to get a better deal, are very efficient when accomplishing goals, and can climb the ladder due to their “never quit” personality.
Sanguine Money Management
Sanguines tend to be natural salesmen because of their extroverted personality. They like to build relationships and large social circles. Regarding money, they can have an “easy come, easy go” mentality.
Sanguines are the type that are most likely of the four personalities to unexpectedly come home in a new car one day because the neighbor bought one just like it and absolutely loves it. Sure, the sanguine probably bought it at a good price, but, their pragmatic spouse would have waited a few more months or years and let it depreciate a little more. This also means they might make a large investment in a reputable company, but, it might not be the stock with the highest growth potential.
In addition to impulse purchases for themselves, sanguines can also be very generous. This can come in the form of giving gifts (i.e. overdoing Christmas) or acts of charity. While putting others before themselves is laudable, it can be frustrating to the spouse that is managing the checkbook and paying the bills each month.
In addition to impulse purchases for themselves, sanguines can also be very generous.
The largest challenges for sanguines is that they probably struggle the most, among the four behaviors, to balance the checkbook, set aside enough each month for savings and retirement, and are sometimes too generous. They might need a monthly allowance to help them stick to their budget. If they are like my grandpa, he gets a weekly spending allowance to limit impulse purchases.
Melancholy Money Management
Perfectionist. That is probably the best word to describe the Melancholy mindset. People with this temperament are the most likely to create and follow a budget. Of course, their budget is so perfect that they might not even be able to adhere to it. If so, they might experience the classic “Perfectionist burnout” and become frustrated and give up for a brief moment.
Their desire for perfection means they might also mean they miss out on life because of their fear of failure. Professionally, this means they will not apply for a promotion until they reach certain personal milestones, even though lesser-qualified candidates have also applied for the job. They might also remain in a lesser-paying job because it better aligns with their personal values and goals.
Their desire for perfection means they might also mean they miss out on life because of their fear of failure
Financially, the melancholy temperament is generally frugal. But, they also make large purchases in select categories they highly value. For example, they might need to buy a new car and want “the best.” Instead of buying a Ford or Chevy, they purchase a Lincoln or Cadillac instead. Regarding clothes, they might spend the additional money to buy Levi’s instead of Wrangler blue jeans. When buying coffee, they opt for Starbucks instead of Folgers. The cheaper versions work just as well, but, do not have the additional luxuries or quality of the flagship brands.
Overall, melancholy spenders know how to stretch a dollar but will splurge on their favorite things. For couples with a melancholy spouse, one of the biggest challenges is taking risks & getting beyond the professional and financial “comfort zones.”
Phlegmatic Money Management
This final temperament could be described as “Melancholy Lite” as they demonstrate many of the same tendencies but view taking risks and spending money with some differences.
Phlegmatic spouses are natural savers and living within their means. Although this innate ability to save can quickly be considered stinginess as it pains them to spend any money at all, but, are generous once the realize the benefit of the purchase or charitable donation. One great financial example that Matt Bell uses to describe this personality type is that they will keep a restaurant tip card in their wallet (guilty!) so they can give the precise 15% or 20% tip for their waitress.
Some financial challenges for phlegmatic spouses include not being cheap or stingy. While they do not intentionally try to be the next Ebenezer Scrooge, they might need to learn how to make caveats during no-spend months to buy gifts for their spouse that cost more than 99 cents (it’s okay to pay retail price sometimes).
…this innate ability to save can quickly be considered stinginess as it pains them to spend any money at all, but, are generous once the realize the benefit of the purchase or charitable donation.
Phlegmatics might also gain the reputation for being “packrats” as they will keep something until it is broken and also acquire old couches, clothes, or television sets that their neighbors no longer wanted but are still in good working order to avoid purchasing a new one in the future. Another person’s trash is a phlegmatic’s treasure.
As Phlegmatics can also have a perfectionist mindset, they have the tendency to start tasks like investing or saving for a goal, but, might need some motivation from their Choleric or Sanguine partner to start contributing monthly instead of suffering from “paralysis by analysis” or waiting for the perfect opportunity. Once they start a habit, phlegmatics are known for the consistency and loyalty.
Probably the starkest difference between Phlegmatics and the Melancholy personalities is their behavior. Melancholy folks are more stiff and rigid on the day-to-day activities and like structure due to their desire for organization and structure. Phlegmatics can be organized, but are more outgoing and carefree, but, not to the same extent as the Sanguine personality that rarely meets a stranger.
What’s your personal finance temperament?
I was fascinated when I found out the primary temperament for my wife (choleric) & I (tie between phlegmatic & melancholy). It helped us understand how we viewed money (and life as a whole) and some of the ways we can work to improve the way we view money and improve our relationship at the same time.
In addition to the four temperaments, Fruclassity also shared a great resource to help you determine if you are a Giver, Taker, or Matcher when it comes to personal finance. It’s another great tool that help you gain a better understanding of yourself.
Just as understanding personalities goes beyond seeing the glass “half full” or “half empty,” it is just as important to know how your personality affects your money management decisions. It might be the tool you needed to help you get on the path to becoming debt-free or resolving some marital tension.
What is your personal finance temperament? Have you ever looked into how your personality affects your money management before?