Understanding emotional spending and how to curb it

Emotional spending occurs when you buy something you don’t need and, in some cases, don’t even really want, as a result of feeling stressed out, bored, sad or even happy. It’s really hard to keep your emotions in check when considering your spending decisions. But there are ways you can become more aware of them to make sure emotional spending doesn’t inhibit your long-term financial goals. 

Understanding emotional spending

According to the Money Advice Service, 19 million Britons are spending £26.5 billion on credit cards due to emotional life events. Whilst there is nothing wrong with treating yourself from time to time, if you are doing it to alleviate or satisfy feelings you might need to spend some time getting your spending back on track.

Avoiding emotional spending completely is probably not a realistic goal for most people but there are some steps you can take that can help you notice emotional spending and ultimately help you to make the most out of your money.

First, though, it’s probably useful to understand some emotional spending triggers in more detail.

A feeling of personal pride or wanting to be admired can mean we purchase things to keep up with the Jones’.

The term ‘retail therapy’ derives from the emotional and immediate relief shopping can sometimes give. It can temporarily make us feel happier, able to forget the thing we were feeling sad about.

Emotional spending isn’t only associated with sad feelings. Joy or happiness can also be a trigger of emotional spending. For example, if you recently got promoted and wanted to celebrate.

Emotional sending has a place and it isn’t always negative. We are certainly not saying you should never treat yourself but when it begins to become unmanageable is when you need to look at how to curb emotional spending. Here are 3 ways you can do that.

1. Avoid impulse buys

One way to cut down on emotional spending is to avoid making impulse buys. We all do it but often mindlessly. When you are going shopping, whether in person or real life, if you find yourself wanting to buy something you didn’t already want to get before you visited, give yourself 24 hours to mull over the idea.

By really thinking about your purchases and giving yourself 24 hours to think about it, you’ll be able to know if you still really want it. If you do still really want it in 24 hours but you really think you can’t afford it or it’s unnecessary, give yourself a week or even a month to think it over, especially if it’s a big purchase.

2. Limit temptation 

If you know you find it hard to resist temptation when you’re in a shopping centre try to limit your visits by planning which months you can and cannot go. Likewise, if you get tempted by those pesky social media advertisements, unfollow brands or turn off your audio so you don’t get targeted ads.

3. Hold yourself accountable

Holding yourself accountable for your spending can be a good way to limit temptation. Accountability can come in a number of forms. You could tell people you live with or your family that you’re trying to spend less and you want them to call you out when they see you spending emotionally. Or if you could write down every expense to keep an eye on your outgoings or even better make a list of your financial priorities and stick it in a place you’ll see it regularly.

Understanding emotional spending means becoming a bit more aware of how you spend your money and having the ability to hold yourself accountable. If you feel like you do a lot of emotional spending try the three methods mentioned above to get your spending in check.

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