Emotional Spending: Why do I do it? How do I stop?
Money isn’t something we often like to think about, and yet the world we live in requires us to spend it constantly. From bills to rent, new clothes to car payments, spending is an unavoidable part of life. And for many of us, it can be hard to control: we spend money based on our emotions and feelings rather than our needs and necessities, which can put a huge unnecessary dent in our bank accounts and keep us from getting to that state of financial stability we all strive for.
So what is emotional spending, why do we do it, and how can we curb that habit that keeps so many people in debt or poverty?
What is emotional spending?
Emotional spending is basically what it sounds like: spending money based on emotions rather than logic and rationality. Rational spending would be spending our hard-earned money based on a budget or to purchase only what we need, when we need it. On the contrary, emotional spending is much less structured and much less needs-based; it can often be impulsive and reckless, leading us to spending more money than we can afford on expenses we don’t actually need.
This type of emotional spending can take on many forms: It can look like impulse purchases (both small and large), where we see something in the moment and buy it without consideration. It can look like retail therapy, where we go on shopping trips as a form of fun and relaxation rather than as a necessity. It can even look like overspending on things we do need, like convincing ourselves we need a nicer car than we can afford, or name-brand groceries when store brand would do.
Why do I spend money emotionally?
If you have trouble with emotional spending, you might be wondering why that is or what’s causing it. And while we’re not mental health professionals and are the first to admit that every person’s life situation is different, most believe that emotional spending fundamentally comes down to a response to stress and lack of control.
Often when we’re feeling stressed or anxious about life’s other difficulties, it becomes much easier to spend recklessly as a way of recapturing some sense of control, even if it harms us in the long run.
When we’re constantly under pressure from friends, family, bosses, and society to act or behave a certain way, how we use our money can be one of the few ways we exert authority and control in our lives: We may not be getting a promotion at work, we may not be seeing the changes in our relationships we want, but “gosh darn it,” we think to ourselves, “I can buy that thing I want!”
So if emotional spending is a coping mechanism we use in response to stress and anxiety in life, how can we control it and limit the harm it causes to our lives and our pocketbooks?
How can I control emotional spending?
Emotional spending can be a tough habit to quit, but that doesn’t mean there’s no way to make things better. Here are just a few ideas that can help you curb those urges to spend when you don’t need to and set you up to get your finances back on track:
- Create and stick to your budget: We know, we know–we always go back to creating a budget. But that’s because it’s possibly the single most important tool to maintain control over your financial situation. Not only does creating a budget help you identify where every dollar will go, but it provides a form of outside accountability to help keep you from spending recklessly. It may not seem like a big change, but asking yourself “do I have room in my budget for this purchase?” is a much bigger deterrent to emotional spending than “do I have money in my back account?”
- Allow yourself small treats and rewards: This may seem counter-intuitive, but allowing yourself to make occasional small purchases that make you happy can keep you from blowing lots of money on large emotional ones. Budgeting for a nice coffee each morning or a small Amazon Wish List item each month can help you feel in control and like you matter, whereas squeezing every single penny can often lead to pent-up pressure that “explodes” with major emotional purchases.
- Leave the credit card at home: Even when we know that credit cards need to be repaid, having that line of credit in your pocket (or on your phone) can lead us to feeling like we’ve got infinite money on-hand at any time. So leave the card in a drawer at home, take it out of your Apple Wallet, and practice responsible credit usage–not having it in the palm of your hand will help keep you from making impulsive purchases you can’t afford.
- Consider professional help: Impulsive, reckless, or emotional spending can often be a symptom of other, broader life or mental health issues. If you’re trying the obvious first steps and still struggling, consider if you would benefit from therapy, financial coaching, or other professional support. Finding an option that’s covered by insurance or works on a sliding scale can ensure that you’re getting the help you need identifying and resolving the real underlying problems.
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