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Buying things can be fun – in the moment. For example, you walk into a store, or are surfing online, not meaning to buy anything, and then all of a sudden. . . boom. The perfect sale pops up right in front of you! It’s meant to be, right?
No so much.
Here’s the fact: Americans impulsively spend an average of $450 every month. That adds up to an extra $5,400 spent every year. That’s a lot of limited edition sneakers.
But just think—if you invested that $450 every month, after 10 years at an 8% rate of return, you’d have over $83,000! Compound interest can definitely help put things into perspective. Keep in mind, this is your money; consider paying your future self forward!
What Is an Impulse Buy?
Anytime you purchase something you weren’t planning to, that’s impulse buying. It can be as small as grabbing a strategically placed candy bar in the checkout line that wasn’t on your grocery list or as big as walking into a car dealership and saying, “I’ll take that red convertible, please.” If it’s not planned for in your budget ahead of time, it’s an impulse.
Almost all of us have fallen for the temporary excitement of impulse buying. In fact, 88.6% of Americans say they’ve done it! It’s really hard not to, but why is this the case?
Why Do We Struggle With Impulse Buying?
Do you ever wonder why we buy on impulse? Hint: Emotions play a huge part. Our personal finances are just that—personal. So it makes sense that when something’s going on with us personally, it shows up in our money habits too.
For example, when you’re having a rough day, does a little retail therapy sound like the cure? It may not seem extreme; going to one of your favorite stores and buying a new outfit, or purchasing a new movie. You just want to buy something new to make yourself feel better.
However, listening to our emotions is a surefire way to let impulse buying take control. And it’s really easy to do too. Sneaky marketers know this and try to purposely play on your emotions with their advertisements. They hope their ad tactics will hit a nerve with whatever emotions you’re feeling when you walk into their store, see their commercial, or scroll past their marketing email. Hey, we get it. Buying stuff is fun, and it feels good. But how long does this last? And is it worth the price you pay?
We may get a temporary rush because buying something on impulse feels exciting. That’s because it releases dopamine (the chemical that makes you feel good) in the brain. Instead of turning to impulse buying to give you that high, try going for a run, hanging out with friends or family, dancing in your living room—anything you like to do that makes you feel happy (without spending money)!
How to Stop Impulse Buying
All right, so how can you stop impulse buying? Here are 7 tips to help you dodge the temptation to overspend.
1. Make a budget and stick to it.
Okay, first things first: You need a budget. If you don’t already have one, then stop and take 10 minutes to do it right now. Fill out our budget worksheet here. This will help you calculate your income minus your estimated expenses and know how much you should have left-over each month.
Knowledge is half the battle when it comes to a budget—you have to actually stick to it! A budget isn’t a magic wand that will suddenly make all of your money behave. You are in control of your money – where it goes each month and how it’s spent. If it’s not already budgeted for, don’t spend the money. Yep, it’s as simple and as hard as that. But you can do it!
2. Give yourself permission to spend.
Yes, we just told you to stick to your budget—and you always should. But it’s a good idea to budget for a little fun money too! You can’t go the rest of your life without purchasing something on a whim. The trick is giving yourself (and your spouse if you’re married) a line item in the budget with your name on it for your fun spending. That way you know this specific amount of money can be spent on something you want. Depending on your budget, this might be $10 a month or $100 a month. Just make sure the amount is reasonable and affordable for your budget!
3. Not so Fast!
Patience can actually save you money. If you decide to wait a day (or longer!) before you make a purchase, you may calm down and not actually make that impulse buy. Waiting can give you a cool head and a fresh perspective. Just ask yourself if you’ll actually use this thing and if you can pay cash for it now. That’s a no-nonsense way to look at the purchase with clear eyes.
Also, don’t let the “fear of missing out” make you overspend. Missing out on a 24-hour sale is not the end of the world, because another sale will come back around. Trust us.
“When you sleep on the decision, you put some time between your emotions and the transaction.” — Rachel Cruze
4. Shop with a plan in mind.
Figure out what items you want to buy and how much you’ll spend before you ever start shopping. With a plan in place, you’ll be less likely to give into overspending. Your shopping list can range from grocery items to the Christmas gifts you plan to purchase for your extended family—just know what it is you want to buy, and how much to spend, before you go.
5. Bring someone with you when you shop.
Accountability goes a long way here. Do you have a spouse, sibling or friend who’s willing to get in your face and tell you not to buy something? Bring them on your shopping trip. Tell them what you plan to buy, and ask them to talk some sense into you if you start straying from the strategy. You can even make a two-way agreement with them, and offer to help them when they go shopping too. The more accountable you are, the more likely you are to succeed.
6. Put the phone down.
It may be a good idea to take a break from social media sometimes. If you’re having trouble with comparisons, social media isn’t going to make it any better. If you know you have trouble being content when you scroll past everyone’s highlight reel (aka your newsfeed), then remove the source of the problem. We’re not saying you have to kick social media to the curb forever, but try not logging into Instagram and Facebook for a week (or more) and see if you notice a difference in your spending habits.
And even if you don’t find yourself falling into that comparison trap, the reality is that social media is one big, major billboard for impulse buying. Everywhere you scroll, someone is trying to get you to spend your money. If you’re not on the app, you won’t see all the businesses with flashy sales and new products for you to spend your hard-earned dollars on.
7. Keep your goals in mind.
Here’s a real shocker: Giving in to an impulse buy won’t help you achieve your financial goals—whether that’s getting out of debt, paying off your mortgage, or investing for your future. A great way to keep track of your financial goals is by using Money Desktop to track your expenses and manage your debt.
Buying on impulse and overspending will eat up any extra money you were saving to put toward those awesome goals. Remember you are doing this to help yourself – remember the goals you’re working toward!
“Children do what feels good. Adults devise a plan and follow it.” — Dave Ramsey
Don’t Get Sucked Into Impulse Buying
There’s no denying the fun of unexpectedly buying something, but that excitement never lasts. So control the urge to fork over money when you discover a jacket on sale or when a sweet offer lands in your inbox. Learning to be disciplined with your money will get you something much more priceless—peace of mind. And that’s one thing you’ll never regret investing in!
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