According to a new Gallup poll, inflation is causing financial hardship for most Americans. The rising cost of living and subsequent financial anxiety They are huge motivators to curb emotional spending.
Like it or not, your emotions often determine what you buy, when you buy it, and even what you’re willing to spend. In my therapeutic practice, I have seen depression will result in lost wages due to low productivity and cost people their jobs. I have seen clients accumulate debts during manic episodes before they were properly diagnosed and treated by Bipolar disorder. A woman bought a horse, a car, and a boat in one weekend, none of which she could afford. She was mad at her husband, so it’s interesting that the shopping was all modes of transportation!
Just as you are told not to go to the supermarket when you are hungry to avoid impulse purchases, the same applies to your mood. Your mental health status can affect how you spend money.
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What causes impulse buying?
A to study reveals that the COVID-19 The pandemic has increased consumer impulse buying as it makes us feel like we have some power in a situation that seems out of our control. Other to study shows that impulse buying gradually increased during the first six months of the pandemic when the CARES Act (first stimulus package) was passed. Suddenly, consumers found themselves panic buying as they hoarded products like toilet paper due to a scarcity mentality.
But what else triggers those impulse buys? It is often a tempting opportunity as buy now pay later programs, which encourages impulse buying. With programs like these, you get the instant gratification you could be craving. But when the bill arrives, those “feel good” emotions can turn into buyer’s remorse.
There are psychological reasons why emotions drive what you buy, such as regaining a sense of power and control. Impulse purchases seem to put him back in the driver’s seat when something happens in his life that is out of his control because he can control what he puts in his shopping cart.
How to stop emotional spending
Making financial decisions based on your emotions can have a lasting impact on your mental health and result in financial self-sabotage and overwhelming debt. With a little planning, you can tame impulse buying.
1. Consider a financial cleanup to promote tax awareness.
If you want to reduce or eliminate emotional spending, consider a financial cleanse. Choose a spending ban between 7 and 21 days. Doing so can increase your spending awareness and save you some money.
During your financial cleanup, don’t use credit cards, if possible, and don’t go to malls or retail stores (even online). Also, remove retail apps from your devices and don’t buy restaurant food or coffee – do everything at home and pay for your purchases with cash. If you need to buy a gift for a friend, consider doing something for him, giving him an unused item, or being honest with him about his cleanliness. The period of abstinence from extra expenses allows you to become more mindful about excess and develop healthy consumption habits. It can be challenging, so consider doing it with a friend or accountability partner so you can motivate each other and stay sober about your spending.
2. Create a relapse prevention plan.
Identify the people, places, and things that are triggers for you when it comes to impulse buying. Maybe it’s someone you’re trying to impress, being at the mall, the retail apps on your phone, or following influencers on social media.
When you find those kinds of triggers, have a support plan that works best for you. For example, you might call an accountability partner, your therapist or sponsor, go for a walk, or attend a 12-step meeting.
If you have a relapse, practice self-compassion, learn from it, and move forward and upward. It takes some time to change old patterns of emotional spending.
3. Apply mindfulness to finances.
Before spending money, ask yourself:
- Is it absolutely necessary to spend money on this item or service? If not, can I pay it?
- Will this expense bring me closer or further away from my personal, professional and financial life? goals?
- Does it feel aligned with my values?
- Am I clear about this purchase on my gut?
Try this approach for a week. At the end of the week, write in a journal anything you’ve noticed, like spending less money because you were more aware of it. Keep track of your spending for at least a week as well. Talk to a friend or therapist and discuss what you noticed.
Fix your financial mindset
There is a direct correlation between mental health and financial health. In our instant gratification society, it’s much easier to come up with a temporary pain reliever as “retail.” therapy” when our mental health is suffering. Instead, develop regular mindful spending habits where you question yourself before spending money. For more exercises and support, consider working with the program in my book, The Financial Mindset Fix: A Mental Fitness Program for an Abundant Life. When your emotions no longer drive what you buy, you’ll experience the relief of better mental and financial health and Resilience.
