A recent study found that Americans fall into four categories when it comes to how they view money: “money avoidance, money worship, money status and money vigilance.” Most fall into the first three.Professor Brad Klontz at Kansas State University asked 422 subjects, who made from under $30,000 to over $100,000, primarily grew up middle-class and were college-educated, questions about money-related beliefs. The respondents fell into these categories:
Money Avoidance: If you’re in this category, you believe money is bad or that you don’t deserve it. You stay away from credit cards, are risk-averse and probably have a low net worth. People tend to grow out of this category as they age.
Money Worship: This is the classic “money makes everything better” worldview. It is also the definition of greed. White people are more likely to be in this group than other races. Young, single people weighed down by credit card debt make up the biggest part of this group.
Money Status: Your self worth and net worth are interconnected. Unfortunately, this obsession with materialism “has been associated with lower ratings of well-being, lower levels of self-actualization, vitality and happiness, and higher levels of anxiety, physical symptoms and unhappiness.” Also composed mostly of young singles, this group tends to be less well educated.
Money Vigilance: Give yourself a pat on the back if you’re in this category. You have a certain “alertness, watchfulness, and concern about money.” At the same time, “excessive wariness or anxiety regarding pending financial danger keeps someone from enjoying the benefits and sense of security that money can provide.” This group is disproportionately non-white and includes many people who don’t hold credit cards.
Childhood experiences had the biggest influence on the responders’ views of money and economic status. If one’s parents had a healthy approach to finances, it was more likely the next generation would too.
This study is a reminder that consumers can be just as stupid as banks, Klontz told the New York Times: “The predatory lending and the greedy people on Wall Street, they’ve certainly played a role in this, but what led you to buy a house you couldn’t afford, even if someone let you do it? If you’re willing to look at the answer to that, the likelihood of you making the same mistakes diminishes greatly.”