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What’s your money mindset?

By Noemi Pamintuan-Jara 14 January 2022 | 1 minute read

According to new research, most Aussies fall into four primary money mindsets. Knowing which category you fall into can better help you plan out your finances.

money mindset

A recent study of more than 1,000 people conducted by the National Australia Bank (NAB) identified how most Australians view and handle their finances, and it offers some insight into the spending and saving habits of Australians – as well as how they can better manage their money.

Dollar-stretchers carefully monitor their spending and frequently struggle to make ends meet.

Goal-driven savers work hard to meet their savings targets, but whose habits can shift once they reach a specific target.

Impulsive spenders enjoy a variety of experiences but are uninterested in long-term planning.


Habitual savers enjoy saving money and derive satisfaction, safety, and security from seeing it grow.

NAB group executive for personal banking Rachel Slade observed that income doesn’t affect how a person handles money. 

“Our research and interviews showed money mindsets aren’t income dependent. Instead, they are influenced by major milestones like getting married, having a baby, achieving a financial goal, or a change in financial circumstances,” she said.

With this in mind, NAB has suggestions on how people can handle their finances according to their mindset, by first identifying one’s mindset.

Dollar-stretchers are acutely aware of where their money goes. Their income is spent on necessities such as food, rent, and transportation, as well as debt repayments, leaving little or no money for discretionary spending. They are excellent budgeters. They also frequently use credit to cover day-to-day expenses and may be concerned about their finances.

Dollar-stretchers should first consolidate loans. They can take out new loans with lower interest rates and pay off the smallest debt first. They should also start saving for an emergency fund in regular and small increments as soon as they are able. In an emergency, they should be aware that assistance is available. 

Goal-driven savers can easily set aside money for a specific purpose, such as a holiday. When highly motivated, they will cut their expenses while increasing their income through extra shifts or side hustles. They also use financial windfalls such as bonuses and tax refunds to boost savings. However, they may be hesitant to commit to a long-term savings goal, such as a down payment on a house. Also, unexpected expenses can prevent them from reaching their target if they do not have a savings buffer.

Goal-driven savers should create a savings plan as well as a savings goal. Separating the savings goal account from other money, such as an emergency fund and everyday accounts, can be beneficial if they use fee-free accounts. When they get paid, they may either deposit a portion of it straight into a savings account or set up an automatic transfer based on what’s leftover at the end of the pay period.

Impulse spenders give priority to discretionary spending and instant gratification. In some cases, they can even forgo paying their bills. They are unlikely to have long-term financial goals and are generally motivated to reward themselves. Interestingly, they can become goal-driven savers if a goal is appealing enough to them.

Impulse spenders should refrain from making any unnecessary purchases. This is especially important during the first week of a monthly pay cycle to ensure that they have cash at the end. They need to separate their savings account from their discretionary funds. They should also leave items in their online shopping cart for three or five days to determine whether they truly want or need them.

Habitual savers live frugally and seek bargains because they want to control their lives and be secure. They allocate savings at the start of the pay cycle and are likely to “bucket” funds. They can, however, overcommit and run out of funds for day-to-day expenses. They are most likely saving for a down payment on a house or own property and have an investment strategy. They access personal finance tips from various media and have financial role models.

Habitual savers must plan the month not to overestimate their savings. They must keep in mind that unexpected expenses sometimes occur, and they must identify major one-time purchases wherever possible. They need to plan for their next step, such as investing and set a goal to help them achieve it.

For Aussies who plan to save for the year, Ms Slade has advised: Use budgeting tools, consider what is appropriate for their current circumstances, and seek out independent legal, financial, and taxation advice.

About the author

Noemi Pamintuan-jara

Noemi Pamintuan-jara

Noemi is a journalist for Smart Property Investment and Real Estate Business. She has extensive experience writing for business, health, and education industries. Noemi is a contributing author of an abstract published by the American Public Health Association, and Best Practices in Emergency Pedagogical Methods in Germany. She shares ownership of the copyright of an instructional video for pharmacists when communicating with deaf patients. She attended De La Salle University where she obtained a double degree in Psychology and Marketing... Read more

What’s your money mindset?
money mindset
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