When the holiday season comes around again, I always feel a little overwhelmed with how much I spend and how easy it is to accumulate a large credit card bill. And come to think of it, there are lots of times in my life where I have bought something without thinking, only to realize it was a huge waste of money. I look back on all of these ridiculous purchases and can only think about how much money I would have saved if I never bought them.
Let’s face it, I’m an impulse spender. I tend to make impulse purchases and I love buying clothes. Online shopping is a huge addiction and there is nothing better than picking up another shirt or jacket. There is something so rewarding about getting something new and I recognize that I need to change my mentality around shopping. I shouldn’t shop because it makes me feel good. I should shop only because I have to and it is absolutely necessary.
So for 2019, one of my resolutions is to track my purchases better and curb my impulse spending.
What is Impulse Spending?
Impulse spending, also known as impulse shopping, is the act of purchasing something without planning to do so beforehand. It can often be a spur-of-the-moment thing, brought on by seeing the product right before you head to check-out, or brought on by the sudden emotional desire to purchase something.
We can impulse shop for virtually anything- grabbing a pack of gum just before paying for our groceries, adding a pack of socks to our clothing purchase at the cashier desk, or even going online and suddenly buying something because we saw an email for a big sale. Basically, if you haven’t thought long and hard about the financial impact of this purchase, then you are doing it impulsively.
This can lead to you buying something you didn’t really need in the first place. In the long run, if you add up all of the things you bought impulsively in the past year, you likely spent a lot more money than you really planned to.
Why do We Engage in Impulse Spending?
There are many reasons why someone might shop impulsively.
It could be for emotional reasons. We might go shopping because we’re bored or stressed, and shopping is an activity that we know we enjoy. While this can be therapeutic momentarily, it will likely lead to more stress once you realize just how much you spent.
We might do it because we like trends and always want to be a part of them. We might see that every month some new pattern or design comes out and we must have it. Therefore, we’re okay with going out and spending money on new things constantly. But this mentality isn’t good for us emotionally, or financially. We have to be okay with living with what we already have and not focusing on what’s “cool” at that particular moment.
We might engage in impulse spending because we’re always hoping to get the greatest deal. I know many people who are always hunting for a bargain and are willing to jump on anything if they think the price is low enough. But later on, they happen to see the same thing for a better deal and regret it immensely. If they had been more patient and willing to think about their purchase more, they might have saved themselves a lot of money.
Finally, some people are just naturally more impulsive. These are the same people who will drop everything and leave for a spontaneous trip the next day, or will skydive because their friend has an extra ticket. They tend to be impatient and want reward immediately. Therefore they are willing to spend large amounts on random items. In the end, this behaviour is exciting and rewarding for them, meaning they are more likely to do it over and over again.
So… How Can I Stop my Impulse Spending?
1. Understand why you engage in impulse spending
After reading some of the reasons why we impulse shop, do you feel a connection to any of the characteristics above?
If so, it’s time to come to terms with why exactly you might impulse shop. Like the old saying goes- the first step, is admitting you have a problem. Once you know the root of your shopping issues, you can make a plan to fix these behaviours for the future.
For instance, I recognize that I impulse shop when I’m bored. It’s a fun activity that makes me happy and to be honest, I think I get a dopamine hit from getting a new package in the mail. So I keep online shopping, in order to experience that excitement when a new package is waiting at my door. Now that I know that, I realize that I don’t buy things that will better my life or serve some sort of purpose. In the end, it really has nothing to do with the item itself. It’s just the thrill of buying and getting a package in the mail that makes me do it over and over again.
And so, now when I feel bored, I try to do something else to keep myself occupied. I’ll avoid social media (which is full of nice clothes and stuff to buy) and I’ll put my laptop away. This forces me to be present in the moment and saves me from buying something else I don’t need.
2. Follow the 3-Day Rule
If you see something that you like and you want to purchase it, give yourself 3 days to think about it before you go through with the purchase.
These 3 days will be enough time for you to decide whether you can live without that item or not. Taking time to cool-off from that initial excitement will also show you whether you’re buying that item out of impulse, or because it’s something that would genuinely add value to your life.
Giving yourself time to think will also allow you to build a pros and cons list, as well as do more research on the item. Is this the best price you can get or this item? Can you get it somewhere else? What are the ratings and reviews like on that item? Is the quality worth the price?
Giving yourself time is the first step to ensuring you’re not making an impulse purchase and allows you to make an educated purchase.
After you have the new item in your hands, save the receipt and think about the purchase you just made for another three days. Now that you have this item in your hand, do you feel happy? Do you think it’s good quality? Do you expect to get a lot of use out of it? Is it everything you dreamed it to be and more?
If the answer is “No”, then it’s time to send it back! Thank god you kept the receipt.
3. Unsubscribe to store’s email lists
There is nothing more tempting than waking up to a few new emails from your favourite retailers, boasting about a great sale. You eagerly click through those emails and see all of the bright and shiny things they have to offer- and on a discount too! Who can resist?!
They know you can’t. That’s why they send them every day. So do yourself a favour and unsubscribe from them. Chances are, if you had never seen those emails, you never would have gone onto their website and bought a few things.
4. Avoid social media
If you feel like you have the bug to shop, avoid social media at all costs!
Do not watch YouTube haul videos. Do not go on Instagram Stories and watch what new things influencers are pushing you to buy. Social media has turned into a way for companies to indirectly pressure you to buy their stuff. And they’re doing a great job at it.
These days, no one wants to be directly marketed to. We hate when commercials come on TV, but we’re more than happy to watch a sponsored video by our favourite YouTuber. Well guess what, while you’re watching that, they’re telling you that you need this product to live a happy and long life. And we eat it up.
If I feel like I need something new, then I know Instagram or Youtube will only push me over the edge. So do yourself a favour and put down the technology.
5. Set a budget and stick to it
If you have a hard time controlling your impulse purchases, then it might be time to set a budget. There is only so much you should spend each month on frivolous items and you need to be really strict with the amount you set for yourself.
If you’re looking for some help on how to create a budget, check out this older post of mine for a beginner’s guide to budgeting.
Once you have a budget set, you’ll have to track everything you buy and make sure that it aligns with your plan. It’s easy to ignore your budget and lose track of what you’ve bought throughout the month. So design an Excel spreadsheet for yourself, where you can track not only that you spend, but also your income, so you know exactly how much is going out of your bank account each month.
6. Take inventory of what you already own
No matter how few shoes you own, or how outdated you think your jeans are, you likely have more things in your wardrobe than you can even imagine.
If you ever wonder if you need a new jacket, just take a look in your closet and see what you have stored in there. You might end up finding an old coat that you stashed in the back years ago, and lo and behold, it’s back in style again! Now you don’t have to go out and get another one.
You might be dying to get a few new basic shirts, but if you just dig around in your dresser, you might find a few t-shirts that have been accidentally stuffed in the back.
Taking inventory of what you already own can also ensure that you don’t buy the same thing twice.
At the end of the day, we own more than we even realize. So more than likely, we don’t need to buy more things.
7. Be open about your spending habits
Once you decide that you’ve had enough of your frivolous impulse spending, it’s time to make that declaration public.
Tell your roommates, your parents, your siblings and significant other. Let them know that you’re going to crack down on your spending and you want to make smarter financial decisions. They can be a helpful source of encouragement and can provide you with their own tales of financial failure and success. They might even want to make changes of their own and you can work together to spend less.
Telling everyone you want to stop impulse spending is like telling people you’re going to work out more. The last thing you want is to not follow-through on what you proclaimed you were going to do and then they’re always asking you if you’ve gone to the gym yet. Then you either have to lie or admit that “No… I haven’t made time for it yet”. It makes you more accountable and keeps you on track.
Making smart spending decisions is hard and giving up on impulse shopping can be even harder. If you’re legitimately addicted to the thrills of impulse spending, then it can feel like giving up an old pastime.
But deciding to stop impulse shopping will force you to have a better relationship with your money and in the long run, your savings will thank you.