4 types of ultimate money-savers: Are you one of them?

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It’s no secret that if you want to reach financial freedom, you have to form good money-saving habits. But while some people may find it difficult to apply savings strategies to their everyday life, there are others who are actually addicted to it.

Read more: 19 ways to cut costs and save more each month

In fact, despite the ongoing challenges people have with saving money, 25% of the general population actually find it painful to spend money, according to a study conducted by Professor George Loewenstein of Carnegie Mellon.

Loewenstein studied 13,000 people to examine how their brain activity responded to both desirable items (candy) and undesirable items (the candy’s price tag). You can probably guess how the participants responded to seeing candy — the brain demonstrated a positive reaction. But when they saw the candy’s price tag, the ‘pain and disgust’ regions of the brain started to show activity.

Thinking about your own reactions to discovering the cost of certain things may give you some insight into your own mindset about saving. But it’s important to remember that being ‘extreme’ about anything can be dangerous — and some people are so concerned about saving money that it can actually end up costing them more in the long run.

So if you want to know what type of saver you are, here’s a look at the characteristics and motivations of four different types of ultimate money-savers — along with some of their pitfalls and how to avoid them.

Read more: How to save more money: Rethink your spending


4 types of ultimate money-savers

1. The Tightwad

Philosophy: “It hurts to spend money.”

‘Tightwads spend less than they should,’ Loewenstein says. ‘They recognize that they should be spending more for their own well-being.’

Tightwads are the type of people who find it painful to spend money — and they’re actually disgusted by it. It’s not just the added pleasures in life that they don’t want to spend money on, but even spending on basic necessities can be an issue for these people.

Takeaway: If you’re a tightwad, but don’t want to be, then you may just need a new strategy. For people who have a hard time budgeting their money, Clark suggests breaking down your budget into separate categories and then have different bank accounts for each. That way you can make sure you have enough money going toward necessities, emergency savings and long-term savings — before you spend any of your extra cash.


2. The Frugalist

Philosophy: “Saving money brings me joy.”

While tightwads just hate spending money, people who are frugal are more interested in the pleasure that they get from saving money.

For frugalists, financial freedom is more of a way of life than long-term goal. Their lives revolve less around material things and more around financial independence.


“While much attention is focused on consumption, saving can also deliver joy and satisfaction: The feeling that financial security is not a destination, but a lifetime journey with a positive trajectory,” says Karen Carlson, director of education at InCharge Debt Solutions. “Happy savers are typically independent and unconcerned with social pressures to drive a flashier car or have the latest gadgets.”

Takeaway: Being frugal isn’t a bad thing, but it could become a problem for you (and for your friends and family) if you start to become more of a tightwad.

Don’t stop living below your means. But remember that it’s OK to spend money on the things that bring you joy in life.

Read more: How frugal folks can save even more

3. The Food Hoarder

Philosophy: “The more I buy, the more I save.”

This is not always true — and in fact, this can very often not be true.

Yes, buying in bulk can be a great way to save money on certain things. But you shouldn’t buy everything in bulk, because it’s actually not always the best deal.


Takeaway: It’s important to understand when you should buy in bulk and when you’re better off buying in smaller quantities. Storage space, shelf life and actual cost per unit are all important to consider. Here are some tips on what to buy in bulk and what not to buy in bulk. And remember, when you spend money on things you aren’t going to use or consume, that’s money that could have been put into savings!

Read more: 12 ways to reduce food waste and save more money!

4. The Extreme Couponer

Philosophy: ‘I love getting more for less.’

This is a great mindset to have if you’re trying to save more money. But it can also be an addiction.

You don’t want to buy something simply because it’s on sale or because you have a coupon. All you’re doing is wasting money that could be saved.

Takeaway: Re-think your spending habits and why you love to use coupons and get discounts. Try planning out your purchases — like groceries — and only buy what’s on your list. If you can save on those items, great, but don’t buy anything else just because you can get a discount!

Read more: 4 ways to trick yourself into saving more money