Beat the urge to splurge
The urge to buy something on impulse can be strong for a lot of reasons – it’s a bargain, you deserve it, or just because it’s right there. However, impulse buying can become a problem if it means you spend more than you earn. Here are our tips on how to reduce your impulse buying so you can direct your money to the things you want.
What is impulse buying and why do we do it?
Impulse buying is the unplanned decision to buy a product or service, made just before a purchase. Some people impulse buy when they are in their lunch break or getting their groceries. Others buy products when they are searching online or when they are shopping with friends.
Sometimes people have a weakness for impulse buying certain items, like the latest electronic gadgets, shoes or even chocolate. Impulse buying may occur because of a fear of missing out (FOMO), or people may find it hard to ‘let go’ of the idea of making a purchase if they convince themselves it’s what they need to do.
A poll of MoneySmart readers in August 2016 revealed that most people impulse buy extras at the supermarket (38%) as well as clothes (29%).
How retailers get us to impulse buy
Sometimes buying products on impulse can also be induced by the clever marketing of retailers. Online retailers might know what you like based on what you’ve searched for and bought before, and will use this information to target their online ads to you. Similarly, in-store retailers place items at the ends of aisles so you will grab them on the way past, without a second thought.
Case study: Leona changes her shopping habits
Leona was in the habit of buying something as soon as she got paid, and often dipped into her savings to treat herself at the shops. When Leona got an unexpected large phone bill, she didn’t have enough savings to cover it and had to sell some of her purchases to pay the bill on time. After that, Leona made a commitment not to shop on payday and switched to using cash, instead of a card, so she could keep track of what she spent.
How to reduce the urge to impulse buy
The trick to overcoming buying things on impulse is to think about what you are going to buy, before you shop. Here are some ways to combat your shopping urges.
Make a public or personal commitment to change
If you know when you are likely to impulse buy, for example on payday, during your lunch break, or online in the evenings, commit to taking steps to counteract these habits. It might mean you decide not to spend money on payday, not to shop during your lunch break, and limit your online purchases. Telling someone about this or writing it down will make you more accountable and help you stick to it.
Sleep on it before you buy and make a list
If you see something you want, wait at least a day before you buy it. You might find that the urge is less the next day, or you’ve identified something else you can put the money towards. Always write a list of what you need before you go shopping, and stick to it.
Use cash and leave your cards at home
Instead of using a credit card, withdraw the money and use cash. It will be easier to keep track of what you are spending on those little extras. If you have multiple cards, consider reducing the number.
Avoid shopping centres
If you’re tempted to browse stores and pick up a bargain, try going to a smaller shopping complex for things like groceries, where there are less items to tempt you. If you go shopping to relieve stress or to feel happy, try to swap it for something else, like exercise. Instead of heading to the shops, go for a walk or to the gym.
Lean on friends
Phone a friend to take your mind off the urge to go shopping. If you have a friend who isn’t a big shopper, consider taking this person with you to the shops so that they can help you to limit your purchases to only the things that you need.
Do a budget
Planning to curb impulse buying starts with your budget, because you don’t want to spend money that was meant for a bill.
Work out what you have left after you’ve paid your vital expenses like rent, food and bills.
Once you know how much you have left, think about your goals – what do you want in the long term? Is there anything you need to save up for? Factor that into your plan too. Then look at what you have left, so you know what you can spend on extras. Constantly remind yourself why you are trying to change your habits and keep an eye on your bigger savings goals.
Reward yourself for free
If buying something on impulse is a way of treating yourself ‘because you deserve it’, come up with ideas on how else you can do it that doesn’t cost money. This may include things like a long hot bath and home facial, visiting your local free museum or art gallery, having a picnic in the park, a movie marathon at home, taking time out to play a board game or computer game, reading your favourite book, trying a new recipe, or allowing yourself to sleep in.
Learning to reduce impulse buying will help you to live within your means, have money for emergencies and to save money so you can realise your long-term goals.
Contact our office for paper based or electronic budget planner.