Everyone deals with stress and anxiety. Whether it’s work-related, issues at home, health problems, or something else, stress can weigh you down emotionally and physically.
While there are many solutions to help lessen the effects of anxiety, some people tend to turn to indulgences, such as emotional spending, to relieve tension in their lives. While this may help make you feel better in the short term, the long-term effects could lead to situations that cause even more stress – such as excessive debt.
What is Emotional Spending?
Emotional spending is when an individual spends money as a means to mask or relieve their negative emotions and feelings. And with the ability to order just about anything online and have it delivered to your home within days (or even hours), emotional spending is an easy way for many to cope.
While this may seem like a harmless way to make you temporarily feel better, if it becomes a regular occurrence, it can create a bevy of financial issues down the road.
How to Combat Emotional Spending
If you find yourself stress-spending regularly, review the following tips to help you curb this habit.
1) Acknowledge it. First and foremost, you have to realize what it is that you’re doing. Look through your purchase histories online or hard-copy receipts over the past couple of months. How many of these purchases are for items you needed versus things you wanted and bought impulsively? If the latter is the majority, you may be using shopping as a means to cope.
2) Make your money less accessible. An easy way to combat emotional spending is to make your money less accessible. One way to do this is by opening a separate savings account without an ATM card. By keeping your savings in a different account and telling yourself those funds are just for saving, you’re less likely to spend it.
3) Lock your credit cards. Most lenders now offer cardholders the ability to lock their credit cards via online banking platforms or an app. This feature was primarily designed to avert fraud on your card by preventing purchases from being made while the card is locked. However, it’s also a great way to avoid overspending. If your card is locked, the purchase should be denied until you unlock the card. While you can unlock the card pretty easily, it’s an extra step that will make you stop and think about why you locked the card in the first place.
4) Make it harder to shop. Remove easy payment methods from your computer, tablet, and phone. This could include removing digital payments, such as Apple Pay, deleting apps, like PayPal, or even removing stored credit card data on your favorite shopping sites.
5) Give yourself an allowance. Cutting yourself off entirely from fun money is setting yourself up for failure. Instead, give yourself a monthly allowance. This way, you can factor the allowance into your monthly budget. You'll still have spending money, but you’re not affecting your overall budget or financial plan. You can either put these funds on a prepaid debit card or give yourself a cash allowance. Once the money is gone for the month, it’s gone. Do not allow yourself to spend any more than what was initially allocated.
6) Stop browsing. Many people who have problems with emotional spending use a portion of their time “just” browsing the internet or window shopping. While you may have good intentions of only viewing products, often, an unbeatable sale can cause you to make an unplanned purchase. Therefore, you should try to cut this habit out and replace it with something else that doesn’t cost anything, like going on walks, reading, or taking up a new hobby.
7) Start a side hustle. Starting a new hobby is a great way to cut down on the free time you might otherwise use to spend money. But if a hobby isn’t for you, consider taking on a side hustle. By starting a side hustle, you’ll not only add additional income to your budget, but by keeping busy, you’re less likely to have time to shop.
8) Avoid ads. With the constant onslaught of advertisements you see every day, avoiding ads can seem impossible. However, there are steps you can take to limit your exposure to these temptations. If you subscribe to emails from retailers, consider unsubscribing. Cutting down on your use of social media and other websites that expose you to advertisements will also help.
Emotional spending can be a tough habit to break. However, once you recognize the triggers that cause you to spend emotionally, you can begin devising a plan to help curb the behavior.
If you’re interested in setting up a separate savings account or would like to learn more about locking your credit cards, we’re here to help. Please stop by any of our convenient branch locations or call 248-322-9800 extension 5 to speak with a team member today.
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