Impulse spending: battling your ‘buy now’ instincts
Your heart and mind are racing, thinking about the latest new thing you saw in-store, in a catalogue, online or from a friend. Your first thought is I gotta have it!
It’s one thing if you can afford it, but when it comes to shopping, emotions can defy all reasoning, even in the most reasonable of people. And thanks to today’s easy access to credit, and the ever-increasing popularity of ‘Buy Now, Pay Later’ programs, all your hopes and merchandise-filled dreams are but a click away, while allowing you to defer any financial decisions and consequences until later. The problem is, those financial consequences could be dire for those that make impulse spending a habit.
What you’re buying on impulse
A 2012 survey by BMO found that 59% of Canadians admitted to impulse buying, of which 55% bought something they might not need because it was on sale. For both men and women, topping out the impulse purchases Canadian buyers said they spent money on, were clothing, dining out, books/magazines and shoes (notably missing from the men’s list was electronics, which even I’ve been guilty of).
But, although we immediately and most commonly point to these categories when we think of impulse spending, we often don’t associate impulse spending with the larger expenses, such as automobiles and housing — but they can be. Be it new cars, fancy appliances, furniture, and custom kitchen upgrades to a kitchen some never/rarely use, or whether buying that first home just to ‘get into the housing market’ — or really when we buy anything as a symbol of status — we’re letting our emotions dictate and affect our decision making.
While this may be very true for some, I don’t believe we can paint everyone with the same brush. Let’s face it, we’ve all acted impulsively, at some point. But unless we can learn to control it, habitual impulse spending can quickly lead one into debt, marital issues and other problems.
The reasons we make impulse purchases are many. You might buy on impulse because you feel you deserve it; you buy to impress (whether that be a purchase for yourself or a gift), you came into some extra money (through a gift or maybe a work bonus); you’re an avid collector; something goes on sale (whether you need it or not); or maybe you just had a down day.
Whatever the reason, and although there are definitely external factors and emotional responses that persuade us, I don’t buy into the idea that impulse buying is a completely unplanned decision.
Impulse purchases are not always on impulse
In fact, I think many times they’re quite intentional — we just don’t think or care to think about the consequences. And we actually plan to spend frivolously because we think we deserve it. Being in a bad mood somehow gives us permission to buy. Getting an extra bonus or commission at work or just knowing that you’re getting paid this week, somehow gives us reason to blow it all.
I often hear some co-workers talk about how excited they are to get their paycheque, so they can buy such and such. And by mid-week, they already have planned what they’ll be spending their paycheque on, and what un-maxed cards and accounts are left to use. So there’s definitely some planning involved. And to a certain extent we all ‘decide’ on how to deal with a ‘bad’ day, whether that’s devouring that big bucket of chicken wings, tearing into a big bag of chips, or tearing through the mall on a shopping binge.
You CAN control it
If we can plan to manage our response to those ‘bad days’, it’s in our power that we can learn to control our impulse spending too. So how do you avoid impulse spending and take control? Well here a few of the things you can try:
Plan to plan. I know a crazy concept, but there are some things that you can plan ahead. For example, you know that you’re having a baby – there are things that you will need. Like a crib. Don’t wait till a week before the baby is born to run out and get one. Take control of the situations you can control. If you think planning for a baby is too crazy, wait till the baby comes!
Delay your purchase. One of the best ways I’ve found to curb any impulse spending is just to write it down and delay your purchase for a week or more, depending on how big of an expense it is. If you still want it and think it’s worth the price, then buy it. Delaying your purchase even for a few days makes you think about and sometimes that’s just enough to catch yourself from making any rash decisions.
Avoid/limit the places you shop. Yes, strangely enough in 2014, there are other things to do, other than hanging out at a mall. Why tempt yourself? If you have a shopping addiction, do yourself a favour and avoid the malls, or at least limit your visits. If online shopping is your vice, avoid storing your credit card information online and instead of making the purchase, use sites that allow you to set up wish lists and come back to that wish list in a couple of weeks and see if you still want it.
Pay in cash. Take out a small amount that you’re willing to spend in cash, and leave your plastic at home. Only spend the money you have in your wallet. Easy peasy! It’s surprising how well that works!
And sometimes, you’ll find that it is worth it. At the end of the day, there’s nothing wrong with treating yourself once and a while, as long as you’re the one in control. Just keep in mind that the instant gratification we derive from these impulse buys is most often just that – instant, but very short-term. Sometimes delaying those decisions and using that money to save up for something you really want, I think, will ultimately provide you with a greater sense of satisfaction over the long-term.