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How Birth Order Affects the Way You Manage Money

5 Minute Read

Youngest children are wild. Middle kids are starved for attention. Firstborns come out of the womb giving orders. And only children are spoiled to a fault.

You know the stereotypes—you probably even experienced them to some degree growing up. (And yes, we know there are always exceptions!)

But does your birth order affect how you handle money today? And do some of us have natural advantages (or disadvantages) because of it? We’ll let you decide:

The Oldest Child

You were the guinea pig for your parents. They didn’t know what in the heck they were doing with you. So you experienced more rules and less freedom. But you also had their undivided attention in return. And because you didn’t have a sibling to follow, you mimicked your parents, which made you more confident, organized and mature.  

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How You Handle Money:

You love the idea of knowing where your money is going each month. Budgeting is a smart, logical move to you. But you tend to be risk-averse at times. Investing can feel a little unnerving, but in the end you know it’s the wisest move for your family and your future.

Action Step:

If you’re married, remember to include your spouse in the budgeting process—even if it's not something they necessarily enjoy. When it comes to your investments, you can gain confidence by chatting with one of our local tax professionals.

The Middle Child

First came love. Then came marriage. Then came a baby in the baby carriage. Then came you. And then came another freaking baby! Needless to say, you didn’t have your parents’ undivided attention. But you did have siblings to play with. You learned how to keep the peace, care for others, and strike out when need be.

How You Handle Your Money:

You thoroughly understand the team aspect of budgeting. And you’re great at solving others’ money problems. But you rely a little too heavily on the opinions of others (read: your parents, friends or siblings) when it comes to making your own budgeting decisions. At the end of the day, though, you realize you need to take your own money advice before you can help others.

Action Step:

If you're single, ask a trusted friend (not your shopping buddy) to help you organize and prioritize your budget. It helps to have outside eyes—as long as they are the right eyes. And if you're married, your spouse is your built-in accountability partner. Lean on them, but push back when needed.

The Youngest Child

By the time you arrived on the scene, your parents were older, wiser, and (let’s face it) a lot more distracted. That’s why you had to grab attention wherever you could find it. You knew how to push everyone’s buttons, in the best and worst ways. And your wild, fun-loving spirit made you equal parts creative and innovative.

How You Handle Your Money:

Your self-esteem isn’t contingent upon stuff. You can rock a 10-year-old sedan while you pay off debts without blinking an eye. But you can sometimes forget to think through the consequences of risky money moves—like going into debt in the first place. Luckily, you have some good influencers in your life who aren’t afraid to help you get back on track.

Action Step:

If you’re working yourself out of debt, stay focused. Make a progress chart and hang it on your fridge so you can see your goal every day. Get the whole family involved! Use your creative juices to have fun with your kids or spouse on a dime. After you’re out of debt, use those same skills to live on less while you save more!

The Only Child

You got all the attention as a kid—even when you didn’t want it. When it came to responsibility, you were on the ball and organized. But you also knew how to mess with your parents and liven things up. Plus, you learned how adapt to any social situation, like a room full of adults or a playground full of your peers.

How You Handle Your Money:

You are a perfectionist when it comes to your money. And you’re laser-focused on achieving your goals. Because of that, you can sometimes feel like you deserve expensive dinners or clothes you can’t really afford to reward yourself. In the end, though, you’re not afraid to buckle down and fix whatever budget leaks you create.

Action Step:

If spending is your weak spot, start your monthly budget by giving and saving first. Then, as you whittle your money down, give yourself a reasonable amount to spend on clothes or restaurants. The end result should be a hard-working budget that equals zero. And if you’re married, be sure to split the fun money with your spouse!

Related: Guilt-Free Spending: The Secret to a Liveable Budget

Who’s the Best With Money?

We all have our strengths and weaknesses when it comes to money. And while birth order may influence how you handle money, it doesn’t determine your success. So take control of your cash with a budget, and refuse to let anything hold you back!

Envelope systems are the smart and easy way to manage your cash and stop overspending. Buy the one that is right for you and get a free PDF Guide to the Envelope System.

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