psychology of money

We tend to rationalize our impulse spending, and often enough, we're telling ourselves lies to feel better. LearnVest explores different situations in which we tend to spend more and make excuses for it. 

It's 9 p.m. — do you know where your wallet is?

If you're like many women, then it may be right there next to you on the couch as you idly peruse Spring dresses and pastel pumps.

Or at least that's what Gilt.com has found: the members-only retail site recently added 9 p.m. flash sales on Wednesdays and Sundays to cater to our apparently growing penchant for mid-evening impulse buys.

As my friend put it over dinner the other night, "It's the new post-happy hour. My weak point is 9 or 10 p.m. I get home, kick my shoes off, and online-shop. It's not like I need anything; it's just a way to detox from work."

In other words, after a tiring day, she feels like she deserves it. My friend has fallen prey to what consumer behavior experts call a "spending trigger" — an emotional state that makes us more vulnerable to parting with our money.

Related: How I Beat My Online Shopping Addiction

And as Gilt knows, she's definitely not the only one.

The good news? If you know your triggers, then there are ways to avoid financial regrets. Read up on five other states in which we all tend to overspend — and what you can do about it.

You're in the Dating Market

We recently analyzed which was more expensive: being married or single. While the tax advantages of either are a toss-up, single people definitely spend more at the prospect of a promising date. Putting your best face forward sets off spending triggers galore: there's temptation to splurge on everything from hair and makeup to waxing and wardrobe.

While we're all for feeling confident, remember that if this is someone new in your life, he or she doesn't know whether that dress you're wearing is brand new or your favorite go-to. Your best bet is to pick an honest friend who knows you well and to have her help you choose the hottest look from your closet.

And always remember that a good portion of a first impression comes down to not what you're wearing, but what you convey. So take a good look at your body language, and simply have fun.

Read on for more.

Everyone has their own approach to money, and it turns out that your personality plays a big factor. LearnVest shares how various personalities handle money differently.

As a financial planner, Ray Linder sometimes found that he would give what seemed like solid, reasonable advice to a client that would be met with a surprising level of resistance — one that had more to do with emotions than anything else.

A little digging told him that people handle money differently, according to their personality type, and these differences were often in line with the Myers-Briggs test.

Related: Should I Get a Financial Planner? 5 Money Conversations From CFPs

You've probably heard of it: The Myers-Briggs test is a psychological profiling exam that was created during WWII. It divides people into extroverts and introverts, and then segments them even more into types that sense vs. intuit, think vs. feel and judge vs. perceive.

It's kind of complicated, which is why categorizing people into the 16 personality types outlined by the Myers-Briggs test — which you can officially take for a fee — is big business. (The results are often used by recruiters, human resources professionals, salespeople, matchmakers, and lawyers in various professional capacities.)

Linder was so interested in the parallels between the Myers-Briggs test and his clients' approach to finances that he literally wrote the book on it: What Will I Do With My Money? He also consolidated the 16 types into four broader categories: Protectors, Planners, Pleasers, and Players.

But he's careful to point out that there's no right or wrong place to be within the 16-category universe. Rather, the purpose of figuring all this out is to capitalize on your type's natural assets — as opposed to shame yourself or beat yourself up.

We tracked down Linder to hear more about the four P's — Protectors, Planners, Pleasers, and Players.

Protectors

Myers-Briggs Types: ESTJ, ESFJ, ISTJ, and ISFJ

These people are, by nature, very conservative, says Linder. "They think ahead, make sure their future is taken care of, buy the same brands, and shop at the same stores," he adds, noting that they are careful caretaker types who often end up working in the banking system — though not the Wall Street community.

Read on for more.

Many of us don't hesitate when it comes to lending a friend a few bucks here and there. But getting asked for a large sum is a whole different story and could get awkward if you're not sure know how to handle it. Consider these points before you find yourself in such a situation.

Basic questions to ask yourself:

• Is this person trustworthy? Recognizing whether this person is flaky in their day-to-day interactions or is notorious for impulsively blowing money can make all the difference when you're deciding whether to lend or not. Consider character more than how much you like her or how fun and nice she is.
• How close is your relationship? Is it your best friend of 20 years asking you for help, or is it a third cousin you only see a few times a year? Your relationship matters, and how well you know her will play a role in determining how reliable she is.
• Can you really afford it? Think of the worst-case scenario here. Say this person doesn't pay you back — can you afford to never see that money again? Only give what you're willing to lose. If you're comfortable helping out but not with the amount, then offer to give less than what she's asking for.
• Are there alternatives? Borrowing money might not be the only solution to your friend's problem, and that's something you can try to figure out together. Is she looking to buy a new car when you have a friend selling his at an affordable price? Brainstorm other options.

What to say if you're not comfortable lending:

• "I'm not financially in a position to lend money." That's really all you need to say, because no one should question this explanation. But be careful if it's not 100 percent true — you don't want to then brag to your friend about the big trip you're taking next month.
• "As a rule, I don't lend to friends." By making this type of blanket statement, she won't feel like there's something about her that's making you say no. It's simply your hard-and-fast rule. Just make sure you don't lend to another friend shortly after, which could cause hurt feelings.
• "To be honest . . . ": You've heard it a hundred times before, but in this scenario, honesty really is the best policy. Maybe you lent your friend money once before and and she still hasn't paid you back. There's nothing wrong with being upfront about your reasoning.

If you do decide to lend:

• Come up with a payment plan: Take time to sit down and decide on a repayment schedule that works for both of you. If you're clear about your expectations from the outset, then things will (hopefully) go smoothly.
• Get it in writing: Your best bet is to document the agreement. You can easily download a form online, write down the arrangement, and have both of you sign it. It's a standard practice, so chances are she won't be offended.

One of the worst lies we fall for are the ones related to money. These myths are harmful because they can seriously affect your bank account and your life. Read on as LearnVest debunks some of the biggest money myths.

The rumor mill isn't just for celebrities.

It's also for money (seriously!). There's a lot of misinformation out there, and we hear it all.

ATMs are unsafe? Travel is only for rich people? No way. Our lives are stressful enough without letting unsubstantiated and untrue fears about money take over.

RELATED: How to Combine Coupons (and Save Big!)

Take a peek at the top 12 most common money myths that cross our desks, so you don't have to be tripped up by these ever again.

To see all 12 myths, just keep reading.

Willpower can have a big impact on your finances. LearnVest shares a couple of handy tricks.

Aside from our mothers' nagging, our guilty consciences and Jiminy Cricket, willpower is the best thing we have to help us do the right thing when it comes to our money.

Accomplishing financial goals, from deciding whether to buy the perfect pair of wedges or start funding a fabulous honeymoon, often requires choosing between now and later, and needs and wants. Making the correct choice, however, demands the willpower necessary to turn down passing pleasures in favor of the long-term goals you want to achieve.

RELATED: 10 Bad Habits That Are Actually Good for You

Luckily, it turns out that willpower functions exactly like a muscle—which means that while it can become tired and sore, it can also be strengthened, helping you reach your goals more quickly and efficiently.

Read on to find out how willpower works in your brain (no Ph.D. required!) and how you can build it up to achieve your goals—financial or otherwise.

What Willpower Is

Earlier this year, Roy F. Baumeister, a research psychologist, and John Tierney, a New York Times science writer, published a book called "Willpower: Rediscovering the Greatest Human Strength," detailing Baumeister and other scientists' research regarding willpower, self-control and motivation.

Studies show that willpower—the determination to accomplish a difficult task, stay on a plan, break a bad habit and more—exists, but people have only one finite reserve of it. As a result, if you're trying to accomplish a lot of goals all at the same time (New Year's resolutions, anyone?), you're more likely to fall short because your willpower is getting exhausted by everything that's challenging it (that chocolate bar, the impulse to bite your nails, the urge to have a cigarette or a second drink).

Read on for more.

You know how people say that you can't buy happiness? Well, they may be wrong. Money does play a big factor in our lives, and there are little ways you can profit internally off of cash. This doesn't mean you have to be a millionaire (although that would be nice), but it just means spending wisely on things that have a long-term gratification. A question was posed on Quora, which asked for some of the ways people use money to increase their happiness. Here are examples of how money brought joy to the lives of several commenters:

• Hiring a cleaning lady: An anonymous user says that a cleaning lady costs $100 a visit, the cost of which is split among four roommates. The lady comes once a month, but " . . . arriving home to see my entire house spotless with no effort from myself makes me very happy."
• Paying it forward: Dan Stewart, CEO of an email marketing company, says that he remembers what it's like to be poor and hungry. When he finds himself behind someone in the grocery line who is reducing their order because they can't afford it, he pretends to "find a hundred dollar bill on the floor and hand it forward." It makes him happy to help other people. Many of the other commenters seemed to agree that helping the underprivileged by donating to charity or using money to perform random acts of kindness can make one happy.
• Spending on hobbies: Hobbies can get pretty expensive, but it can make people happy when they're doing something they enjoy. One user says that doing something creative makes her happy, but sometimes that creative activity may require a purchase of items such as a camera for your photography habit or sturdy shoes for those who love hiking.

Read on for more.

Enough with the excuses already! LearnVest cites nine reasons you're still in the red.

You might remember a particularly fuzzy story in The Huffington Post that came out last year around Christmas, called "The Real Reason You're Single."

Although much of the advice in the column was controversial or at least unpleasant to read, the thesis came down to this: You can't blame everything on the world, your circumstances, or other people.

RELATED: The Surprising Costs of Being a Woman

In a similar but different vein, today's LearnVest Daily is dedicated to all the excuses we've ever made for why our finances aren't everything we've dreamed:

• Our jobs just don't pay enough.
• Our friends are bad spending influences.
• We're too deep in debt to ever get out.

In response to those, we bring you nine reasons you're broke . . . when you shouldn’t be.

You Put Your Entire Paycheck in Your Checking Account

Of course, you should have a checking account, but depositing all your income straight to checking sets you up to overspend and sideline your savings goals. After all, the money is right there, ripe for the spending, and socking cash away for the future requires transferring it separately to your savings account.

A better solution? Set up automatic deposits straight from your paycheck into your various savings accounts. It's called paying yourself first, and it's much harder to miss money you've never seen in the first place.

Read on for more.

Money clubs are a great and fun way to stay on top of your finances. With friends supporting you, you can conquer the world and money issues! LearnVest shares how you can start one.

Thea, 31, a lawyer, lives in Brooklyn, NY. Although her friends are, in her own words, “bright, savvy, awesome women,” many felt lost financially — much like she did. “In fact, almost all of them knew someone else who was in the same financially adrift boat,” she says.

That’s when she got the idea to start a money group.

“The first meeting was held in my studio apartment in Brooklyn,” she told LearnVest. She served pizza and Diet Coke as the group of women took turns airing their money issues and goals.

RELATED: How to Change Your Life With Gratitude Lists

The women’s issues ranged from needing to pay down credit card debt after an amazing wedding to wondering how to invest in a 403(b) retirement account that she’d left empty for years. “We left that meeting,” she says, “with the same sense of empowerment we often feel in other areas of our lives, but that was usually missing when it came to our financial life.”

Although the women are still working through their money issues and goals, it is, as Thea puts it, “easier to take a journey with a group of amazing friends.”

Are Money Clubs the New Book Clubs?

There’s a reason Thea’s personal experience was so meaningful. Just like book clubs or wine clubs — or book clubs that double as wine clubs — money clubs are groups in which you can learn interesting stuff, discuss it, and get support from like-minded friends. And maybe even add alcohol to put people at ease.

In fact, while they’re now becoming popular again, money clubs have actually been around for a long time. Many groups of women in cities across the US meet up informally, but Candace Bahr, founder of the Women’s Institute For Financial Education, or WIFE, formalized the money club concept, creating the organization’s trademarked version back in 2004.

Read on for more.

Your clothes reveal a lot about who you are as a person. LearnVest shares how psychology affects the way we dress and what our clothing styles mean.

It’s no news that your wardrobe says a lot about you.

What you wear can inform passersby of your type of employment, as well as your ambitions, emotions, and spending habits.

And now it’s even launched a whole new type of psychology.

Clinical psychologist Dr. Jennifer Baumgartner literally wrote the book on this phenomenon, which she calls the “psychology of dress.” In You Are What You Wear: What Your Clothes Reveal About You, she explains not only how psychology determines our clothing choices, but also how to overcome key psychological issues your wardrobe might be bringing to light in your everyday life, or even at work.

RELATED: Nine Easy Tricks to Maximize Your Wardrobe

“Shopping and spending behaviors often come from internal motivations such as emotions, experiences, and culture,” says Dr. Baumgartner. “You look at shopping or storing behaviors, even putting together outfits, and people think of it as fluff. But any behavior is rooted in something deeper. I look at the deeper meaning of choices, just like I would in therapy.”

We spoke with her to figure out why clothes are so revealing (of our personalities, that is), what messages they’re sending and how you can use your wardrobe to change how others perceive you — and even how you think about yourself.

How We Use Clothing as an Aid . . . and a Weapon

Americans rely on clothing as an economic and social indicator because there aren’t official marks of rank such as a caste system or aristocracy, says Dr. Baumgartner.

“When you don’t have a specific system, people come up with their own,” she explains. It’s what “helps you figure out where you fit in. Especially now, with the economy, with people losing status, maintaining a sense of who we are becomes even more important. Our clothes help place us where we think we want to be. ”

She cites the Real Housewives TV series as an example: “Look at the way they focus on money. When they fight, they use logos and designers as a way to put each other down. They’re using clothes and accessories both as a tool to know where they fit in and as a weapon against others.”

Read on for more.

This reader posted in our anonymous Savvy Confessions group, asking if how she should behave with her friends since she makes a lot more money than they do. Do you have any advice for her?

I make more money than my friends. Like a lot more. Many of them are barely scraping by while I'm living comfortably. I feel really bad about it and I try to cover up my lifestyle by not talking about the trips I'm taking and never inviting them over to see my apartment. I don't want to flaunt what I have in front of them. Many are working nonprofit jobs and are still students while I have been out in the workforce for a while and am pretty successful. How do you think I should act? It's quite stressful but I do it so that my friends won't feel uncomfortable but maybe I'm overthinking this. What do you think? I need a second opinion!

Pose your own anonymous questions or off-load your work confessions by posting in the Savvy Confessions group, and I'll find the right expert to help you out.