KNOW YOUR FINANCIAL DNA

DNA tests can tell people about whether they're predisposed to certain traits. They may tell you if you have a tendency towards chopping people into cubes and stuffing them in your basement freezer.  

 

In this chapter, however, I am more interested in your financial DNA which will determine your spending and saving patterns and habits. With this simple test, it will be possible to predict with a high degree of accuracy the probability that you will be able to achieve a low, medium, or a high degree of financial freedom.  

 

I want to determine if you are an investor or a spender. To do so, I have designed a quiz made up of 15 questions. Each question has three potential answers.

 

This is not like school in the sense that there is no CORRECT answer. Answer each question as honestly as possible and make a note of your answers.  

 

Question1: You win the national lottery. What will you do with the prize?

1) it is a prize so you are going to go hog-wild and spend it on gifts, travel, and new cars and houses for the whole family.

2) you will invest half and spend the rest.

3) you will invest the full prize.  

 

Question 2: It is payday. You gave paid the rent, the car, and insurance. All you need to pay is your credit card bill.  What do you do?

1) pay the minimum balance of your credit card and blow the rest on eating out, clothes and entertainment.

2) pay the minimum balance and spend the rest on groceries and a new household appliance (the old ones work fine but you want a change).

3) pay off the entire debt and use the rest for necessities. Whatever is leftover, you decide to invest.  

 

Question 3: An Amazon ad pops up promoting a pair of boots (you already have 10 pairs).

1) you immediately buy them.

2) you bookmark them for later.

3) you ignore the ad.  

 

Question 4: Your friends invite you to a hip new expensive nightclub that charges 20 bucks for a Coke.

1) you go – after all, it is the hippest joint in town.

2) you go, but only order a Coke (Coca Cola – not a hit of cocaine).

3) you decline the invitation.  

 

Question 5: You run your own business and need to take a business trip that involves flying.

1) you book a business class ticket.

2) you book an economy class ticket.

3) you take the red-eye because it costs 20% less than the economy class ticket.  

 

Question 6: How often did you eat out (pre-COVID 19)?

1) almost every day.

2) 2-3 times per week.

3) seldom if ever.  

 

Question 7: Your credit card statement arrives. Your first reaction is...

1) shock, horror, and anguish.

2) mild panic and surprise.

3) unsurprised and even slightly bored.  

 

Question 8: How long does it take for you to decide on a major non-essential purchase?

1) a few minutes.

2) a few hours/days.

3) a few weeks/months/never.  

 

Question 9: Do you keep a daily track of your expenses?

1) are you insane, of course not. Who has time for that?

2) you keep your receipts, and use your credit card statement to gauge how much you are spending – but only monthly.

3) you do so more religiously than a monk -  in an excel spreadsheet (or a monastic version of an excel spreadsheet).  

 

Question 10: When you go to the grocery store, you...

1) arrive with no list, grab a cart and fill it with whatever you feel like regardless of the price - much like a wild animal!

2) you have a list but end up buying more than the list and you check the prices on some items.

3) you have a list (that has been laminated), you stick to the list and check the price of everything and most often choose the cheapest option.  

 

Question 11: When you spend a night at a hotel...

1) you raid the minibar like a sailor that has been at sea for three months.

2) you treat yourself to a bag of nuts and a bottle of Evian.

3) you do everything possible to avoid eye contact with the minibar.  

 

Question 12: How do you go about buying a car?

1) you find the brand you like (typically German or Italian in origin) and find the monthly payment you think you can afford.

2) you buy second hand, low mileage cars – new cars are for suckers.

3) you don’t buy a car – you rent or use ride-hailing services like Uber – car ownership is for suckers.  

 

Question 13: When you buy a house that you are going to live in...

1) it is an emotional decision. You find the house you like and then rely on the mortgage broker to do everything possible to structure the lowest monthly payment for the first 3 years.

2) you put down a large deposit and try and pay the mortgage off as quickly as possible.

3) you don’t buy, you rent.  

 

Question 14: When you buy a new item of clothing, you...

1) go to the store and buy it.

2) go to the store, find the correct size, and then go online to find the best price.

3) don’t buy new clothes – only second hand.  

 

Question 15: What brand of phone do you own?

1) Apple

2) Samsung

3) The cheapest smartphone from China  

 

Results

 

Mostly 1s

You are clearly a spender of Olympic proportions. This is perfectly in order if you are earning Olympic proportions of income but history tells us that even these situations can be short-lived. History is filled with examples of sports stars, rock stars, and deviant politicians who, although are endowed with colossal streams of income, their excessive spending soon overtakes them and they end up tattooing their faces and accepting cameo appearances in low-grade porno movies. You need some financial therapy, coaching, and education before it is too late.  

 

Mostly 2s

The majority of human beings find themselves in this category. While you are not a compulsive spender, you do need to take tighter control of your finances and find ways to improve your financial health.  

 

Mostly 3s

You are colossal savers, almost monk-like in your approach to money. You have adopted a supreme austere approach to spending and the risk here is that you are going to be the richest person in the cemetery when you pass away. While your minimalistic tendencies may be applauded in some quarters, if you have secured a solid flow of income, the time has come to live a little.  Regardless of who you are in this survey, Rebel Finance can help you achieve financial freedom.