January 7, 2021
While we have high hopes for 2021, it’s likely that much of the fiscal uncertainty we’ve experienced in 2020 will carry on into the new year. In setting our 2021 financial goals, it’s more critical than ever that we have a clear view of our strengths and potential blind spots when it comes to money management. In a previous article, I examined the role that personality can play in managing money, focusing on preferences toward introversion or extraversion. Now I’d like to discuss the final two letter types in the Myers-Briggs four-letter personality type: thinking vs. feeling and judging vs. perceiving.
As a reminder, when looking at an introversion (I) or extraversion (E) preference, we’re looking at how an individual gets their energy or recharges their personal batteries. With sensing and intuition, we’re looking at how an individual learns and processes information.
For a fuller picture of how an individual operates, we’ll also look at thinking and feeling preferences, which describe how an individual evaluates information and makes decisions, and judging and perceiving preferences, which look at the way an individual organizes their world.
While one personality type is not inherently better or worse at money management, understanding one’s own preferences can help an individual better identify and address potential problem areas. Improving self-awareness is a beneficial first step in many professional and personal endeavors, and better understanding money management and formulating a money management strategy is no different.
Thinking vs. Feeling
The third letter in a four-letter type looks at how an individual evaluates and makes decisions on the information that they take in. A person with a thinking (T) preference is more likely to make analytical decisions using the information they have on hand. Their feeling (F) counterparts, on the other hand, may take more time to consider how their decisions can affect others before arriving at a conclusion.
People with a thinking preference will most likely exhibit an objective approach to money management. There is the risk these individuals could overanalyze and be too critical about their money management options. To overcome these risks, they can try creating a timeline of goals with an outline of the pros and cons and the degree of risk they are evaluating to ensure they don’t miss a beneficial financial opportunity.
Those with feeling preferences are more likely to be guided by their own values and those of others in making large decisions. Considering the impact of your decisions on those around you is likely a priority, but this may open you up to greater risk of making financial decisions that are too inclusive versus strategic. To combat this, individuals who prefer feeling might consider consulting with a financial advisor to serve as an objective partner in money management decisions.
Judging vs. Perceiving
The last of the letters in a four-letter personality type describe the way an individual organizes their world. Those with judging (J) preferences are likely more task-oriented, viewing their goals as items on a checklist to mark-off. The desire to reach conclusions and check things off their list might cause judging individuals to make decisions before having all the necessary information. Being decisive and goal-oriented can be beneficial, but being rash about decisions can result in negative consequences. For those who have a preference for judging, getting a second opinion before making big financial decisions or commitments can be a way to ensure that the plan is thought through.
People with a preference for perceiving (P) are less likely to expedite a decision than their judging counterparts. They are more likely to want to keep their options open and continue evaluating information closer to the decision deadline. When an investment opportunity arises requiring a quick decision, a person with a perceiving preference might desire more time for research, potentially causing them to miss out on a valuable opportunity. Working with a financial advisor could prove beneficial in outsourcing some of the research efforts.
When looking at the role that personality preferences play in something like money management, it’s important to remember that there’s much more to it than the four letters that make up one’s MBTI personality type. There are sixteen potential combinations of preferences and all of these will impact how a person works, interacts with others and forms and executes goals.
Money management or goal setting may come more naturally to some, and for others, it may be necessary to make goal setting and milestones a more concentrated effort. Everyone works in their own way. As long as an individual is aware of the reasons why aspects of financial planning, goal setting or sticking to a budget might be difficult, they will be better set up for overcoming these obstacles and achieving success in 2021.
Sherrie Haynie, Director of US Professional Services for The Myers-Briggs Company, leads Practitioner Development and Consulting Services.