Tightwads and Spendthrifts

Both of these extreme spending personalities suffer pain and guilt when faced with opening up their wallets. Here's how you can strike a better balance.

Is spending painful for you? Or are you so free with your credit card that you live in a constant state of buyer's remorse? Either way, don't be too hard on yourself. How we feel about spending depends a lot on how we're wired, and that has implications for everything from debt to marital harmony.

Consider the results of brain scans performed on people while they made buying decisions. Researchers found that when subjects were shown products and then prices, about 30% of them experienced a fired-up insula. The insula is the part of the brain that's active "when we're getting socially excluded or somebody's unfair to us or we have to smell something gross," says Scott Rick, a professor of marketing at the University of Michigan and one of the researchers. The study also found that about half of subjects had a more measured response when contemplating a purchase, and 20% seemed to feel pleasure and little pain.

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Bob Frick
Senior Editor, Kiplinger's Personal Finance