It's hard to ignore the extensive marketing and AI-powered advertising that leverages our browsing history to bombard our electronic devices with products that align with our interests. And the smartphone has made it easier for retailers to have consumer’s attention 24x7. Plus, quick payment modes, easy availability of credit and EMI options accelerate the purchase process, thereby not allowing time for second thoughts.
We are all prone to overspending during the festive season. Impulse buying and emotional spending, though fun at the moment, often translate into regret later especially if it impacts our financial planning. So, here are five tips to help you stay away from excessive shopping this holiday season.
1. De-clutter the house: Before going to shop for anything, start by decluttering the house. You are sure to discover things that were purchased and forgotten about, as well as things that are no longer needed. The guilt of money spent on unnecessary purchases and the effort required to clear the house of these will minimize impulsive shopping. Also, you would be better able to decide what you need and what you don’t.
2. Create a budget: The next step is to establish a budget for festive season expenses. It's crucial to consider not only purchases but also expenses for food, drinks, travel, and parties. Setting a maximum limit is necessary to prevent overspending, which could impact the year's financial planning.
3.. Make a shopping list: Sit and discuss with the family to compile a list of new items to be bought. Communicate the budget and allocate specific amounts to each person for their personal expenses. Figure out and agree on common expenses such as gifts for relatives and friends, household renovation or upgrade items, etc., and make a budget for these. This activity will foster a feeling of financial accountability in each family member and motivate them to adhere to the plan.
4. Pay via Cash: This seems challenging in today’s digital age, given the immense ease of making payments and the discounts you get on your cards and digital wallets. However, using cash can help control our spending. When we withdraw a predetermined amount of cash and then go through the process of counting notes to pay, the decreasing wad of money serves as a psychological barrier against impulsive spending. This approach may result in greater savings compared to taking advantage of discounts.
5. Stop shopping on your phone: Uninstall all shopping apps. This is not to discourage online shopping but to discourage shopping anytime, anywhere. E-commerce apps consistently send notifications reminding you of ongoing discounts, special offers, items in your cart, and limited stock, creating a Fear of Missing Out (FOMO) and prompting action in our minds. Even if we disable the notifications, the phone still provides the convenience of searching for deals whenever and wherever we desire, as well as completing the purchase.
Excessive spending is often driven by underlying psychological factors. Some individuals shop excessively to cope with stress, depression, or boredom. Others engage in excessive shopping to display and uphold their social status. And almost all of us are swayed by the lure of deals and discounts. Recognizing and addressing these behaviours is a challenging but necessary process to reduce irrational spending. It's important to identify the triggers that lead to excessive shopping and focus on improving one's relationship with money. There is an abundance of helpful content and advice available online to assist with this journey. Seeking professional counselling can also be beneficial in addressing compulsive behaviours.
This festive season, SPEND MORE time with your loved ones!!
