'Powerful' People more likely to Save Money

First Posted: Jun 25, 2014 11:29 PM EDT

A recent study published in the Journal of Consumer Research found that feeling powerful can help some individuals become thriftier. 

"We were interested in knowing whether the decision to save or not save money was affected by how someone was feeling during the time they were making a savings decision," said study authors Emily N. Garbinsky of Stanford University, Anne-Kathrin Klesse of Tilburg University and Jennifer Aaker of Stanford University, in a news release. 

For the study, researchers found that many participants were willing to save more money when they were made to feel powerful.  For instance, "powerful" participants who sat in taller chairs throughout the study period were more likely to put their money in a savings account than the less powerful participants who were put in smaller chairs.

As previous studies have shown that feelings of power can boost saving habits when people are told they will be saving money, study findings suggest that feeling powerful will not help support thrifty habits in all cases. In other words, when people are given a specific reason to accumulate financial sources, feeling "powerful" was likely to only boost thirty spending habits if there was not a specific reason for savings. Furthermore, researchers found that companies that provide financial services such as retirement planning can use findings to help their customers better prepare for the future.

"People who feel powerful use saving money as a means to maintain their current state of power. When saving no longer affords individuals the opportunity to maintain power, the effect of power on saving disappears," researchers concluded.

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