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Featured Advisor

Srbo Radisavljevic
Managing Principal/Investment Advisor

Edge Portfolio Management


State: IL

At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, following Chicago sports, enjoying ethnic cooking, and serving as a school board member for Norridge School District 80.

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Feelings About Money Can Bring Investors Down

Investment attitudes are formed in early childhood and can be detrimental to emotional and financial health

What does an investor want? The answer, published in a recent issue of The Journal of Financial Therapy, reveals four distinct investor disorders described as avoidance, worship, status and vigilance.

“Money is a significant source of stress in the lives of Americans. Money issues also are a primary reason for conflict and divorce in relationships,” reports the team of researchers, including a psychologist and financial planner. “This is often the result of beliefs about money, whether accurate or not, that impact the way people think about and relate to money in their lives.”

The belief that more money will make things better is the most common belief among Americans, said the study, Money Beliefs and Financial Behaviors: Development of the Klonz Money Script Inventory. Investors with “money worship” tend to agree that “I will never be able to afford the things I really want in life,” or “There will never be enough money.” Financial behaviors of the “money worship” crowd can include unreasonable risk taking, workaholism and overspending. Demographic characteristics linked to money worship include being young, white, single and lower income, with a tendency to carry credit card debt.

Investors with a “money avoidance” profile would identify with statements such as, “I do not deserve a lot of money when others have less than me,” and “Being rich means you no longer fit in with old friends and family.”

Money can stir up fear and anxiety and cause “avoidance” investors to worry about abusing their credit cards or over-drafting their checking account, said the study. These investors may self-sabotage their financial success, avoid spending money on even reasonable or necessary purchases, or may unconsciously spend or give money away in an effort to have as little as possible in their control. A resulting investment behavior could be excessive risk aversion. Money avoiders are more likely to have lower income and wealth levels, and are more likely to be young and single.

A “money status” belief system links self-worth and net worth.  Investors fitting this profile tends to agree that “If you are good, your financial needs will be taken care of,”  and “If something is not considered the ‘best,’ it is not worth buying.” Individuals holding a “money status” belief system are most likely to be young, single, less wealthy and less educated.  People who say they grew up in a low-income home, and those with a high school education or less are significantly more likely to possess “money status” beliefs.

“This may be indicative of the types of jobs held by high school educated individuals in comparison to more prestigious jobs held by those with some college or a college degree(s), and possible feelings of lower self-esteem,” said the study. “Money status” investors may be prone to excessive risk-taking with the “goal of rapid wealth attainment in an attempt to raise one’s perceived social status.”

For many other people, money is a “deep source of shame and secrecy, whether one has a lot or a little,” the study said. People who hold “money vigilance” beliefs would agree that “It is important to save for a rainy day,” and “You should always look for the best deal before buying something, even if it takes more time.” Excessive wariness or anxiety can prevent the “money vigilant” from enjoying the benefits and sense of security money can provide. This group tends to be non-white, lower-income individuals who avoid credit cards.