Are you in control of your spending – or are your emotions?

It happens to all of us. You have a bad day, so you buy something to make yourself feel better. Or you’re having a great day and lose track of your spending!

Everybody’s prone to emotional spending

And lockdown hasn’t made things any easier. Frustrated at home for weeks. Possibly with a little extra saved from not going out. Most of us are spending more time online in the questionable company of one-click shopping and sponsored ads on social media.
But while some emotional spending is OK, it’s all too easy to let it get out of hand, and in the way of our more rational, long-term goals – the kinds of things that will matter more to us in the end.

So, what is emotional spending? Why is it bad? And how can we overcome it?

Emotional spending vs rational

Emotional spending

Buying on impulse. What you want rather than what you need. Giving in to temptation in the moment.Maybe you’re stressed and craving endorphins. Maybe you’re jealous of someone’s outfit. Maybe you’re happy and looking to celebrate somehow.

Rational spending

Making a considered choice. Putting money into something you need. Things that enable you to do something you otherwise couldn’t. Or that offers security.Rational purchases tend to be the kind of thing you plan for a while. Carefully consider the options. Put in the research.

Why is emotional spending bad?

Emotional spending is like cake. It feels good in the moment, but it takes a lot of exercise to shed the weight. And if you eat too much sugar too often you can cause yourself some serious harm.

In the same way, there’s no problem with the odd impulse buy. But it can easily squeeze out your long-term goals.

The more often you give in to impulse, the longer it will take to save for a house or a car. At its most serious, emotional spending can add up to serious debt, with serious consequences.

What causes emotional spending?

For some, emotional spending comes from simple, spur of the moment enjoyment. Enjoying yourself and getting carried away. For others, it comes from a sense of lacking something. This can have deep psychological roots. Shopping often offers a sense of control – even when it gets out of control.

Or it can just be a feeling that life could be better somehow. Most of us feel it, and marketing often relies on it to get us to buy things we don’t need. Adverts depict a lifestyle you don’t have and imply the product is the first step to achieving it. These aren’t just yoga pants. They’re the ticket to a better you.

This kind of marketing is all around us online. Instagram influencers build up a picture of a perfect lifestyle. Then they imply that if you too take this vitamin/use this shampoo/buy these clothes, you can live a life like theirs. And we tend to trust their recommendations more than a normal advert because they’re a daily presence in our stream. We don’t know them, but they feel like friends.

How to curb emotional spending

There are a few tricks to help you curb your emotional spending:

    Manage your money

    Plan and automate your savings. That way you know that what’s left in your account is money you can afford to spend.

    Overcome the impulse

    The impulse to buy is like a sugar craving. And like a sugar craving, it’ll usually go away if you wait long enough. Ask yourself, “why am I buying this?” Train yourself to wait 20 minutes, a day, two days. Chances are, you won’t want it anymore.

    Identify your triggers

    Do you buy clothes online after a stressful day? Do you spend too much on payday? When you experience a trigger, try substituting shopping for something else you enjoy, like exercise, reading, or playing an instrument.

    Enlist help

    If all else fails, enlist the help of your friends and family. Make sure your card details aren’t saved in your browser. Give your credit card to someone else so you have to ask before you can use it. The shame might be enough to break the habit.

    A little emotional spending is fine – you are allowed to enjoy yourself! It should just be intentional – a conscious decision to spend money you can afford to ‘waste’ on something you don’t need.

    Otherwise, you risk the purchases that really matter – like a car, a once-in-a-lifetime holiday, a house deposit or saving for retirement.