How to Stop Emotional SpendingMay 18, 2022
It’s been a long day. You didn’t sleep well last night. Your boss found a mistake in that report you submitted last week. Your dinner was burned because you got distracted by a sick pet.
You’re stressed. Anxious. Depressed. If your first instinct is to browse Amazon or head to the local mall, you may be showing signs of emotional spending. It’s incredibly common. In its 2020 Mental Health and Personal Spending Report, Self found that 77% of survey respondents said they emotionally spend in some capacity, with most people saying they spend to make themselves feel happier or to escape.
While the occasional splurge is fine, emotional spending can derail your financial goals. Learn how to manage your emotions to improve your finances.
What Is Emotional Spending?
Most people know what it feels like to spend money impulsively. Whether buying a new outfit when you don’t need one or ordering takeout for the third night in a row, spending money in ways that aren’t planned can be costly and stressful. But what many people don’t realize is that there’s a name for this kind of spending: emotional spending.
Emotional spending is a term for making purchases while depressed, stressed, or upset. It’s typically something you do in an attempt to make yourself feel happier, to get a dopamine rush, or because you feel like you need to compete with others.
In the moment, emotional spending can be satisfying and give you a sense of pleasure and elevated mood. However, after the initial feeling subsides, emotional spending almost always leads to regret.
9 Ways to Reduce Emotional Spending
Emotional shopping can cause feelings of shame, guilt, and increased stress. If your spending habits cause you to spend beyond your means, you may worry about paying your bills on time, or you may have to delay financial goals like paying off your student loans.
To reduce your emotional spending habit, use these nine tips:
1. Identity Your Triggers
The first step to managing your emotional spending is identifying what triggers your spending. Do you tend to spend when bored? When you see friends posting about their new purchases on social media? When you feel sad or anxious?
Once you know your triggers, you can start to develop strategies for avoiding them. For example, if you find that you spend when you’re bored, try to find a new hobby or activity to keep yourself occupied. If you spend when you see friends posting about their new purchases on social media, unfollow or mute them until you’re in a better place financially.
2. Sleep On It
Shopping online is convenient, but it can also be dangerous for your budget. If you frequently shop online and later regret your purchases, force yourself to postpone checking out.
You can browse sites and add items to your cart. But set a waiting period for yourself, like 48 or 72 hours. If you still want the items at the end of the waiting period, give yourself permission to check out. However, you may be surprised about how often you forget about those items.
3. Delete Your Payment Information
Online shopping makes it easy to buy things. You can even save your payment information so you can buy items with a single click. For those at risk of emotional spending, that’s a problem.
If you find it difficult to stick to a budget or resist temptation, one of the best things you can do is delete your payment information from your favorite shopping sites. This way, even if you do give in to the urge to spend, you’ll have to take an extra step to do so, which may deter you from going through with the purchase.
4. Practice Gratitude
One of the best ways to curb emotional spending is to practice gratitude. When you take time to appreciate the things you already have, it’s easier to resist the urge to buy things you don’t need.
Start by making a list of things you’re grateful for. Include both big and small items, like your health, family and friends, job, or roof over your head. You can even be grateful for simple pleasures, like a good cup of coffee or a sunny day.
Whenever you find yourself wanting to spend impulsively, take out your gratitude list and read it. This will help shift your focus from what you lack to what you already have.
5. Keep Visual Reminders Front and Center
Perhaps you want to buy a home. Or a new car. Or perhaps you want to take a trip to Europe. Whatever your goal may be, emotional spending can hurt your plans.
To curb the urge to shop, keep visual reminders of your goals visible. Keep a picture of your dream house next to your computer, view pictures of London on Pinterest, or look up new car details online. Those visuals can remind you of what you’re working toward, so you can fight the desire to spend money.
6. Unsubscribe from Mailing Lists
Companies send customers three to five emails per week, on average. And companies spent millions on email campaigns. Why? They know their emails encourage you to spend money.
To reduce emotional spending, unsubscribe from mailing lists from your favorite retailers. That way, you won’t see emails about sales or special discounts, and you won’t have to deal with feelings of missing out.
7. Create a Budget
While emotional spending isn’t good for you or your finances, you need to make sure you have some money set aside for extras or splurges so you don’t feel deprived.
When you have a budget, you know exactly how much money you have to work with each month. This makes it easier to resist impulse purchases and stick to your financial goals.
One budgeting strategy that may be helpful is the 50/20/30 rule. With this approach, you allocate 50% of your income to essential expenses, 30% to wants, and 20% to paying down debt and setting aside money in savings.
If you need help creating a budget, check out tools like You Need a Budget and Mint.
8. Track Your Progress
Finally, one of the best ways to stop emotional spending is to track your progress. This will help you stay motivated and focused on your goals.
There are a few different ways you can do this. You can use a simple Excel spreadsheet or pen and paper. Or, you can use personal finance apps like Mint or Personal Capital. Whichever technique you use, track your progress in terms of building your savings, tucking away money for retirement, and paying down debt. You may find it helpful to create graphs so you can visually see the progress you make toward your financial goals.
9. Seek Out Help
For some people, emotional spending can be incredibly disruptive to their lives. If you feel like your spending is out of control, seek out help. A therapist could help you understand the root cause of your spending and develop strategies to cope with it. If you think you may benefit from therapy, talk to your doctor or mental health professional. You can ask your primary care physician for a recommendation, or you can use Psychology Today’s search tool to find a therapist in your area.
Managing Your Spending
Although it can be difficult, managing your spending is crucial to maintaining a healthy financial state. By using some of the tips we’ve provided, like tracking your progress and creating a budget, you can reduce emotional spending and improve your finances. If you find that you need more help, don’t hesitate to seek out professional assistance.