How to Control Your Spending: Recognizing Emotions and Impulse Spending Triggers

How to Control Spending: An Essential Guide

Learning how to control your spending is an essential part of improved financial health and wellness. Spending often gets out of control when we frequently allow emotions to dictate our actions. In other words, impulse spending is the result of emotional decision-making. When you make a purchase on impulse you’re allowing your feelings in the current moment to dictate your actions as opposed to your plans for the future. An impulse purchase, by definition, was not planned. There was no research done or spending limit established when buying impulsively. 

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Many factors can bring on emotions that act as triggers to impulse spending. Therefore being able to recognize the emotions that come into play in spending is crucial for making more informed and intentional choices. In order to control your spending, you first need to understand the role of emotions and what your common triggers are.

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Common emotions that impact spending decisions include:

Joy and Happiness:

• Influence on Spending: Positive emotions such as joy and happiness can trigger celebratory or reward-based spending. Similar to the excess energy felt due to a ‘runner’s high’ after putting in a few miles, you may feel a sense of limitless exuberance and indulge in purchases to enhance positive feelings or treat yourself for personal achievements or milestones.

Stress and Anxiety:

• Influence on Spending: Stress and anxiety can trigger emotional spending as a vice or coping mechanism for a negative emotional state. The dopamine rush felt from the anticipation of the positive experience a purchase will bring encourages ‘retail therapy’ or impulse purchases providing a temporary escape from negative emotions, leading to unplanned and often unnecessary expenditures.

Boredom and Fulfillment:

• Influence on Spending: Boredom can lead to boredom-induced spending, where you may make impulsive purchases to alleviate the tediousness or lack of engagement or fulfillment you feel in your daily life. Online shopping or casual spending on non-essential items may be a response to feelings of boredom or dissatisfaction. Alternatively, positive emotions related to satisfaction and fulfillment can be associated with intentional and meaningful spending. Purchases aligned with personal values and goals can contribute to a sense of fulfillment and emotional well-being.

Fear and Insecurity:

• Influence on Spending: Fear and feelings of insecurity may result in hoarding money or avoiding spending altogether. Individuals with a fear-based mindset might be hesitant to invest, make necessary purchases, or engage in experiences that involve financial commitment. Similarly, the desire for social acceptance and fear of judgment can influence spending behaviors. People may spend to conform to societal expectations or to project a certain image, driven by the emotions of belonging and social validation coupled with the fear of rejection. Likewise, the fear of missing out on experiences or possessions that others have can drive spending as well. FOMO-related spending is often impulsive and may not align with one’s financial goals, as it is driven by the emotional need to keep up with others.  

Recognizing emotions and impulse spending triggers is a crucial step in gaining control over impulsive financial behaviors. Again, impulse spending refers to making unplanned and often unnecessary purchases driven by spontaneous urges or emotions. Identifying your personal triggers that lead to impulsive spending allows you to develop strategies to curb such behaviors. 

Here are 10 key factors to consider when recognizing impulse spending triggers:

1. Emotional States: Emotional triggers are common contributors to impulse spending. Identify specific emotions such as stress, boredom, sadness, or excitement that prompt impulsive purchases.
2. Environmental Cues: External stimuli, such as advertisements, displays, and social or sales promotions, can act as triggers for impulsive spending.
3. Social Influences: Peer pressure or the desire to fit in with social norms (hello social influencer marketing) can lead to impulsive spending. Be mindful of the source, time, and frequency you allow social influences.
4. Online Shopping: The convenience of online shopping, coupled with one-click purchasing options, can encourage impulsive spending. When you shop online from the comfort of your home, your relaxed, comfortable state may influence you to make more lax purchases than you would at a physical store.
5. Urgency: Limited-time promotions, flash sales, or discounts can create a sense of urgency that leads to impulsive buying. This is a marketing tactic used frequently by businesses that you should remain aware of.
6. Lack of Budgeting: A lack of a clear budget or cash flow plan can contribute to impulsive spending, as there may be no predetermined limits on discretionary expenses. When you pre-plan spending and cash flow, you set yourself up for success.
7. Emotional Shopping Triggers: Certain activities, like window shopping, can become emotional triggers for impulsive spending.
8. Credit Card Usage: The ease of using credit cards may lead to impulsive spending, as the immediate financial impact is less apparent.
9. Compulsive Behaviors: Compulsive behaviors, such as a desire for instant gratification, can lead to impulsive spending. Thoughts precede behavior, therefore, being mindful of your thought patterns can help curb spending compulsion.
10. Unplanned Shopping Trips: Unexpected visits to shopping areas or malls without a specific purpose can trigger impulsive spending. Avoid unintentional spending by limiting unplanned shopping trips.

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Strategies for Controlling Your Spending: 

1. Practice emotional awareness and develop alternative coping mechanisms for dealing with emotions, such as engaging in hobbies, exercising, or seeking emotional support.
2. Be mindful of your surroundings and limit exposure to environments that encourage impulsive purchases. Consider unsubscribing from promotional emails or avoiding shopping areas when not intentionally making a purchase.
3. Be aware of social situations that may prompt spending, and make conscious choices that align with your financial goals. Prioritize budget-friendly social activities and communicate openly about your financial boundaries.
4. Implement a waiting period before completing online purchases. Add items to a wishlist and revisit them after a set timeframe to determine if they are genuinely needed.
5. Take a moment to evaluate whether the purchase aligns with your needs and budget, and resist the pressure to make hasty decisions based on time-limited offers.
6. Develop a comprehensive budget and cash flow plan that includes allowances for discretionary spending. Stick to your budget by creating a system for pre-allocating funds to your expenses.
7. Establish rules for yourself, such as only entering stores with a specific intention, avoiding shopping when emotional, and implementing a list-based approach to purchases.
8. Limit (or eliminate) the use of credit cards for discretionary spending. Consider using cash or debit cards for purchases to create a more tangible connection between your spending and available funds.
9. Delay gratification by taking time to consider the necessity of a purchase and its alignment with your financial goals.
10. Plan your shopping trips with a list of needed items. Avoid spontaneous visits to retail locations unless there is a predetermined purpose.

By becoming aware of these impulse spending triggers, you empower yourself to make more intentional and conscious financial decisions. Developing self-discipline, practicing mindfulness, and incorporating intentional spending habits are essential steps in overcoming impulsive behaviors and achieving greater financial control.

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