It’s the little things that add up to a spending/savings problem. The regular trips to Starbucks, the weekly drop-in at your favourite department store or buying your lunch regularly instead of bringing it in. These little things might give the false indication that you can really afford to do it after all, if you couldn’t you wouldn’t have the money to spend, right?
Unfortunately, this isn’t always the case. In fact, individuals who make over $100k a year often have spending problems more than those who make half of that, due to the illusion that they “can”.
The difference is that those who make less simply know there is not a lot of wiggle room, so they stick to a budget. If you’re fortunate enough to make a large salary, a budget is still just as necessary to ensure you’re not spending frivolously.
How can you tell if you have a spending problem? There are several indicators, but most rely on your mental and emotional response to swiping the plastic.
Shopping makes you feel better when you’re stressed out
Also known as “retail therapy”, women aren’t the only ones who succumb to this problem. While the stereotype goes something like “a pair of shoes can solve all woes”, men drop major dime on items when they’re stressed out, too. Whether it’s a new set of golf clubs, a huge and unnessesary computer upgrade or whatever it is, don’t buy the myth that only women fall prey to retail therapy.
The truth is that shopping won’t make you less stressed out. In fact, it will work against you when you see your credit card statement or bank account at the end of the money. Whoops – where did all your discretionary money go? Look at that, you’re stressed out again. And, the cycle repeats.
Stop the cycle – if you’re stressed out, find a healthier alternative to managing it. Go for a walk. Read a book. Watch a movie. Distract yourself if you must, but do it in a way that won’t make it worse for you in the long run.
You feel you have to keep up with the Jones’
Reality: you don’t. Unless your career demands you have the new and best of everything all the time (in which case, you might be making enough to manage that lifestyle) you really don’t need the newest TV, the best new mobile device, the most fashionable clothes, etc.
Our consumer culture makes us think we need the best and newest of everything, but that mentality is also contributing to fuller landfills and greater waste. Sure, caring about the planet might not be in fashion all the time, but caring about your wallet should be.
You hide your purchases from those close to you
Do you feel guilty when you’ve made a purchase? Do you know that your friends or family might be concerned if they knew you went out shopping again? If you find yourself hiding your reciepts or shopping in secret, then this is a huge warning bell that you have a spending problem.
You have an insatiable “urge” to go out and just “buy something” regularly
Does your day not feel complete unless you’ve spend some kind of money, even if it’s just a coffee? Those with spending issues often have the “reward center” in the brain light up when they make a purchase. But, guess what? The world won’t end if you keep that coin in your pocket & your brain is just lying to you.
There’s nothing rewarding about giving up your hard-earned money for something you could do without. Unless you absolutely have to, don’t spend anything. You’ll feel better when you see a more stable number in your bank account than the temporary pleasure you get by purchasing something.
The first step to recovery: stay away from “temptation zones”
This might be particularly hard if you do a lot of your shopping online. In this case, un-bookmark all of the sites you frequent so you have an extra few seconds to really think about whether or not you should purchase something (it’ll take a few seconds to type in the url!). Get someone to hold you accountable.
If traditional shopping is more your vice, don’t get in the car. Don’t go to the mall/outlet center. Keep the card/cards you use for your shopping sprees at home if you must go out. You can’t buy anything if you’re unprepared to do so. It’s the first step, and perhaps a difficult one, but it’s necessary.