Types of people - What money means to them

Personality is defined as the characteristic sets of behaviors, cognitions, and emotional patterns that evolve from biological and environmental factors.

Financial personality is the personality based on his view towards how he approaches his finances which is also known as Behavioral Economics. Knowing one's financial personality will help determine their financial future by understanding what they have been doing wrong and by what can be done to make themselves better. Broadly everyone will fall under these below category. Examine yourself which financial personality you belong to.

Debtors:

These are the people who look rich but broke inside. They would have all the luxuries like beach facing guest House, imported car with doors open vertically. They live beyond their means and their balance sheet will be filled with liabilities more than assets.

These people make the bank rich by taking loans and paying interest on a depreciating purchase.

Income + Loans = Expenses + Interest payment

Shoppers:

These are trendy people. They know what's hot in the market and try to get grab on these stuff before anyone can possibly can. They want to remain in limelight by buying stuff to get noticed.

The only difference between shoppers and debtors is that they know how much they can afford without taking out big ticket loans(EMI not included).

Income = Expenses (EMI included in these expenses)

Spenders:

The type of people who live from paycheck to paycheck. Most of us fall under this category. People with job know how much they earn, they know how much they can spend. They breakeven in terms of income and expenses and are aware of their finances better than debtors and shoppers. Savings will be their last priority.

Income= Expenses+Savings

Savers:

These are people with strong financial discipline who put percentage of their monthly earnings to Savings. For them, top priority will be saving. They can cut down the expenses to meet their Savings amount. They are programmed to be prosperous. 

Income - Savings = Expenses

Investors:

The group of people who make their money work for them. Every rupee they earn has fixed task. There expenses will be on the things that make them money. The more they spend on, the more income they get, as they spend money on assets that makes more money.

Income = Expenses (assets) + Income from the assets

Entrepreneurs:

These are the problem solvers. Their income is determined by size of the problem they solve. They make world a better place. They bring value to fellow people which in turn bring value to their country which in turn bring value to them. They have ideas. They work on that idea and bring it to reality.

Entrepreneurs has ideas, investors have capital required to give wings to those ideas.