Emotional Spending in Present Times?
We’ve all had our days when we’ve ended up buying something obnoxiously stupid or unnecessary solely because of emotional impetus. Emotions come in various forms – happiness, sadness, stress, loneliness. From one perspective, emotional spending may seem like a good solution as it seems much less hazardous than emotional binge eating or consuming alcohol or drugs to counter irresistible emotions. However, this tack is no good. In the long run, it seriously dents your financial future. First, it eats up your savings, which can pose a security problem during a financial emergency. Second, it induces mismanagement leading to stress, probably causing the very same emotional malfunctions we had in the first place.
In the present times, the practice of emotional spending has been on a steady rise, especially because shopping these days has become much easier with a plethora of e-commerce websites offering a variety of items at your doorsteps, and that so quite literally. In addition to this, easy payment options such as credit cards, UPI, instant personal loans, et al also indulge you in online sprees.
Since the potential problems relating to emotional spending have already been pointed out, here is a list of 5 psychological triggers that one needs to curb to keep emotional spending in check.
- Instant gratification and Retail therapy
Mostly in a metropolis, in particular, shopping for materialistic things is deemed an indispensable activity to reward oneself. Whether it is your favorite pair of heels from Steve Madden or the latest MacBook, we are all guilty of treating ourselves with such “gifts”.
Not just that, these shopping sprees stand-in for a barrage of emotions, whether you had a bad day at work, had a fight with your significant other, or simply had finally closed the deal at work that you have been working for, day in and day out. Shopping gives us an instant feeling of accomplishment and happiness during such times.
- Panic Buys
With almost all popular websites popping up with ‘Flash Sale or Today’s Deal’, most consumers are lured by discounts and offers. More often than not, the item is not one we require, let alone desire. We only end up buying it for the euphoria of being one of the very few people to be able to buy that thing at cheap rates.
One of the most common reasons to shop, especially during the COVID-19-enforced lockdown, is the boredom of the daily grind. With TV and social media handles at our disposal, we indulge in mindless scrolling and come across an array of articles that pique our interest; and we end up frittering away money.
- Shoppers’ High
Akin to the high that runners or gym freaks undergo after a fulfilling run or a workout, an emotional shopper gets the same kick of adrenaline and dopamine at the same time when he/she shops something which they have been eyeing for some time, or even otherwise.
- The idea of Savings and Perceived Value of Shopping
The heart of a shopaholic skips a beat when they see ‘Clearance Sale or 70% Off.’ This is the oldest trick in the retailers’ book when they make sure that you concentrate on how much money you are supposedly saving than the money you are actually spending to buy these items. Mostly, if an article is on a heavy discount, we end up buying it, irrespective of whether we actually even need it or not.
Ways to Curb Emotional Spending
Having identified the triggers that activate our spending mode, it is now easy to control squandering habits. The following tips can be kept in mind to be on guard:
- Identify what triggers and pushes you to shop. Be mindful that this is the first step.
- Find alternatives for releasing emotions – frustration, anger, or stress, such as a new hobby, a sport, or even meditation.
- Set up a buddy system with your best friend to curb this problem can also be very helpful.
- Follow the 24-hour rule i.e, adding something in your cart and leaving it there for 24 hours before ordering it. This will help keep impulse buys in check.
That being said, there is no sure-shot solution to this problem. If you are a psychological buyer, it is mostly decided that you will buy something even before you enter the store or open the website –almost like a knee jerk reaction. This is where specialized tools like Salt come to the rescue, enabling you to track your financial health and gather important insights and reports when talking about ways to curb emotional spending. Check out the Salt blog for more financial insights.