Does Our Personality Help Determine Our Financial Success?
Does Our Personality Help Determine Our Financial Success?
Jonathan Clements June 6, 2020
Does Our Personality help determine our financial success? It seems it does, or so says academic research. Psychologists have zeroed in on five key personality traits: extraversion, conscientiousness, agreeableness, neuroticism and openness to experiences. Think of each trait as a spectrum from, say, very conscientious to not at all. Each of us sits somewhere on the five spectrums. Maybe we’re a bit of an extravert, somewhat inclined toward neuroticism, and extremely open to new experiences and ideas.
There’s a host of websites where you can take a relatively quick quiz and get scored on the five dimensions, including FiveThirtyEight, OpenPsychometrics and Truity. You don’t have to pay or give your email address to get the results at these three websites, though Truity has a more in-depth report that’s available for purchase. My scores from the three sites were remarkably similar, so taking just one test will likely suffice. What should you make of the five traits?
Conscientious individuals are organized and disciplined. They don’t leave their clothes on the floor or the dishes in the sink.
Openness measures our willingness to embrace new experiences and ideas. Those who score high in this area tend to be more curious and imaginative, while those with low scores are inclined to resist change and new ideas.
Agreeable individuals aren’t posting snarky comments on the internet or barking at you because you are—or aren’t—wearing a mask. Instead, they’re friendly, trusting, upbeat, concerned about others and slow to criticize.
Folks who score high on neuroticism aren’t necessarily “neurotic” in the colloquial sense. Rather, they struggle with emotions such as moodiness, sadness, anger and anxiety. At the other end of the spectrum are those who are emotionally stable and even-tempered.
Extraverts are the ones you hear talking at parties. They’re exactly what you would expect: They’re outgoing, sociable and enjoy being the center of attention.
No doubt all of us recognize some of these traits in ourselves and in those around us. But I’d pay particular attention to whichever trait seems to be most pronounced. Understanding who we are—and the mistakes we’re inclined to make—won’t necessarily prevent us from messing up, but it’s clearly a step in the right direction.
So what do our key personality trait or traits mean for our career and how we manage money? I pulled insights from a fistful of academic studies, including papers from 2008, 2011, 2012, 2015, 2016, 2017 and 2018. These studies don’t always 100% agree with each other, though their findings largely line up. Here’s what I learned:
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