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Key Differences Between Spenders and Savers
Key Differences Between Spenders and Savers
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Key Differences Between Spenders and Savers

Money254
Njenga Hakeenah
May 12, 2021

When it comes to money, people can generally be classified as savers or spenders. Some of us like to save, others like to spend.

Even with such a binary categorisation, our attitudes towards saving and spending are still vastly different. These money habits are formed over time with various adjustments along the way as some eventually become part of who we are. 

This article looks at the key differences between those who can be described as either saver or spenders but also focusing on what one can do to improve their financial status. 

Nothing brings out our money habits better than an unexpected event that we have to make quick money decisions about. The Covid-19 pandemic, for example, likely impacted spenders and savers differently. How important did it make each reconsider the importance of saving for emergencies? 

Savers vs Spenders: Mindset

The interesting thing about money habits and financial behaviours is that they are dependent on one’s individual psychology, and on historical and cultural factors, according to Oxford psychologist and best-selling author Peter Collet

Spenders will typically derive more pleasure from spending money, while savers will typically get more gratification by saving up. 

A 2019 study developed a straightforward distinction between the two as spenders treating money as a ‘means to an end' with savers viewing money as ‘an end in itself’. This rather simplistic distinction implies that spenders utilise their money as a tool or pathway to accomplishing their goals while savers are more attached to their money as a would be a ‘drug’ making it their true goal. 

To balance it out, it would seem spenders are focused on the benefits of a purchase rather than cost while savers are more concerned about the loss of money while possibly downplaying the advantage the foregone purchase would have given them. 

Savers are the kind of people who will go to great lengths to ensure that they have some money set aside, for whatever reason, and will not pass up any opportunity to save. If this means living below their means, skipping vacations and being outright frugal, then so be it. Savers will have no qualms delaying gratification until a better time.

On the other hand, spenders believe in the YOLO (You Only Live Once) mantra and that there’s little point in having money if you cannot enjoy it.

For spenders, it is usually about the right here, right now kind of approach to life by ensuring that whatever they want, they get. Most spenders will not deny themselves what a saver would consider not a priority spending like a vacation as long as they have the money to pay for it.

Dr. Collett notes that whether a spender or a saver, our financial behaviours are related to not only the historical and cultural factors but also to our individual psychology. This explains why you can have different kinds of money habits in people brought up in the same house.

The beauty about life is that there is no right or wrong approach to it and so while savers have a greater likelihood of accumulating wealth and thus being financially secure, the spenders on the other hand are enjoying the present. In both cases, everyone is doing what they feel and know is best for them.

Differences between spenders and savers

Some characteristics that savers may have include:

1.       Steering away from spending.

If parting with your money can be painful, then it could be an indicator that you are more of a saver than a spender.

2.      Spending money creates fear.

If you are fearful when it comes to spending money, then it could be a sign that you are more of a saver than a spender.

3.      Delaying instant gratification

If you feel no pain pushing a purchase, a holiday or any other expense to another time in the future, then you could be a saver. Unlike the spenders who will have no qualms spending in an instance, the ability to deny yourself something until you are sure about it shows you could be a saver.

4.      Living debt-free

If you are living within your means and you have some money set aside and you are without debt, then you could fall on the savers category. Living debt free is one pointer that even if you do not have any savings yet, you could easily create a wealth nest and pad it as often and as much as you like.

5.      Not spending on needs

In some cases, some savers will forego spending on things they really need because having money in the bank gives them more satisfaction than anything that money could buy.

This shows that one is more interested in what they have set aside than anything else.

On the other hand, characteristics that spenders may have include:

1.       Taking pleasure in buying things

Typically, a spender will get more pleasure spending their money. For them, as mentioned earlier, life is YOLO.

2.      Inability to delay gratification

A spender can’t resist the urge to spend right now on what they feel they want. Most spenders will not mind not having more later and they tend to live for and in the moment. While they may not have much in the bank, this reality does not bother them.

3.      Impulse buyers

Spenders will tend not to make spending plans and they are more prone to impulse spending. If you have no qualms spending on something you have not planned for, then you could be a spender.

4.      Living in debt

Most spenders will run the tab and pay for everything up front without worry. This means that they could easily accumulate debt which is not a big deal to them since spending is what gives them pleasure. If you don’t give much thought before spending, then it could be that you are more of a spender than a saver.

5.      Needs and wants

If you do not stop and ask yourself before each and every purchase whether you really need the item you are spending on, then you could be a spender. Also, if you do not know the difference between needs and wants or you don’t mind such, then you could be a spender.

How spending habits form

As mentioned earlier, what is happening around us largely influences our spending habits.

  • Observing and adopting spending habits of people who are influential in our lives like our parents and others we could be regarding as role models. What we learned from our parents, including money habits, could carry over into our adulthood.
  • The society we grow up in tends to give us what we could call cultural norms which dictate what spending habits are normal and those that are not. One culture may find spending a fortune on a wedding as outrageous while in another, splurging on the same event is celebrated. Our spending habits will most naturally build on the cultural backgrounds we are familiar with.
  • Religion and spiritual beliefs also tend to determine how people spend. A religious person - in a strict sense - will follow and adhere to what the dictates of their faith are and follow the same path even into adulthood.
  • Our individual psychology is one factor that can undo prior cultural conditionings - this is our own formed beliefs and attitudes towards money, either from formal learning or experience. Dr. Collett explains that even two siblings raised in the same environment may have very diverse spending habits.
  • Popular trends, media portrayals - while the magic-bullet theory of media influence on consumer habits is highly contested, there is still evidence that advertising, framing of on-demand products services as well as celebrity and public figure proclamations still have an influence on people’s money habits. 

So you’re a spender or a saver, what next?

Savings allow you to enjoy a greater security in life by ensuring that you have something to fall back to should something unexpected happen. Having savings set aside for discretionary expenses enables you to take risks and also try new things. But is that all?

If you are a spender,

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  • Celebrate the small savings as you get into a habit of saving
  • Have an automatic transfer system where you set aside some money without having to be physically involved.
  • Question all of your purchases to see if they are priorities, needs or wants and if they can wait.
  • Have a budget and keep clear savings goals towards your targets.

If you are a saver,

  • Plan to have a certain amount of money to be spent on enjoyable activities or items every month.
  • Do not shy from spending on quality items which will save you on regular replacement costs.
  • Be in control of your finances and not vice versa

While everything is said and done, it is important not to just understand what you are purchasing; but also why you spend or save the way you do. This means going beyond a budget and examining all the factors to help you put your spending habits in context. This will help you understand yourself much better thus enabling you to change what you need to, to become better at managing your money.


Njenga has over 8 years experience in multimedia and business journalism both as a writer, editor and producer. He has over 5 years of experience in radio broadcasting as a news reader, reporter and presenter. He is also a 2012 Earth Journalism Network-EJN Fellow.

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