Navigating Financial Challenges in Your 40s and 50s: The Impact of Impulse shopping

The Consumer Society and Emotional Spending: A Guide to Mindful Money Management

We live in a society that cherishes and promotes the consumption of things. Yet, depression, anxiety, and other emotional “issues” are affecting the largest percentage of our population in history. In the developed nations, our mental health is suffering, could this consumerism be part of the problem? One can now order anything and have it at their doorstep within 48 hours. The appetite for consumption is incredible: We buy “stuff” if someone will grant us credit.

Marketers argue that this shopping experience will make us feel better: we shop when we are sad, depressed or bored, we are constantly told that we will feel better only after we complete our purchase. Does it really make us feel better long-term? Why does our society have increasing levels of people with depression? Increasing Anxiety? Why has mental health worsened with the increase in availability of “One-Click Shopping”?

Between 50% to 80% of shoppers regret impulse buys. These purchases linger like a hangover that comes back to make us depressed and anxious when we receive our credit card statements the following month.

The Modern Consumer Culture

Living in a pro-consumer society may provide materialistic abundance, but it is often at a high psychological cost. Our culture aggrandizes non-stop acquisition, but this cycle of wanting and buying never fulfills us as human beings.

Understanding our Emotional Triggers

Emotional spending is motivated by:

• Instant gratification.
• Social comparison.
• Social status.
• Escape from negative emotions.

The Digital Shopping Revolution

Modern technology has changed how we shop:

• 24 – 48 hours for delivery.
• One-Click Shopping.
• Easy access to credit.
• Constant advertising.
• “Peer pressure” from social media.

How do we break the cycle:

• Identifying our emotional shopping triggers. Do you shop when bored? Instead read a book or watch a movie.
• Self-Implement cooling-off periods.
• Ask yourself “why” questions. Why do you want to buy this? Why now?
• Check what you already for items that have the same purpose?
• Focus more on experiences than on possessions.
• Kids spell the word love “T-I-M-E”, instead of buying more stuff for your kids go spend more time with your kids. Ask them what they want to do (exclude shopping) and go do it.
• Apply mindful spending habits.
• Unsubscribe from all marketing emails and text notifications.

Develop Sustainable Consumer Habits

Have you ever thought of the natural resources used to make all the “stuff” you have? We all need some stuff, but do we need the overflowing closet? Do we need all the stuff in the drawers that will not shut? The garage full of boxes to the point where our cars will not fit in them? Most of us could go a year or more without buying one more item, except for food, and be just fine. How would your life be different a year from now if you did this?

The Age of Online Shopping and Impulse Buys

In today’s digital era, online shopping has transformed how we make purchasing decisions. In the past, these types of impulse buys were usually small ticket items that a retailer would display near the register or check-out lane. With the age of online shopping, this is no longer limited to low price items and really can be anything. It is estimated that over 40% of online sales are impulse buys. What we lack as a society is what I like to call “shopping discipline.”

The “Hidden” Costs of Lack of Shopping Discipline

A lack of shopping discipline in today’s digital marketplace can lead to serious financial and emotional consequences.

Financial Impact: Let’s explore the financial costs of unchecked spending habits.

Poor shopping discipline generally translates into:

• Mounting credit card debt.
• No savings.
• Missed financial goals – delaying or not being able to retire. AKA – Working until you die.
• Reduced investment opportunities.
• No emergency funds.

Emotional and Psychological Costs

The emotional toll of poor shopping discipline:

• A means for immediate satisfaction, followed by an unshakeable feeling of regret.
• Deep emotional cost, lasting remorse and guilt after purchases.
• Increased anxiety, concerns about losing financial security.
• Lower self-esteem.
• Less happiness.

Hidden Costs of Poor Shopping Habits

Have you ever stopped to consider how a lack of shopping discipline affects other aspects of your life, namely:

• Reduced financial flexibility.
• Lost opportunities (investments, travel, etc.)
• The additional storage cost for all the unnecessary, almost-too-nice clothes & items.
• The time spent trying to organize overflowing closets/drawers instead of doing something meaningful with your most valuable asset – your time.
• The time spent “reselling” what you bought, almost always at a loss.

The Financial Stress of Impulsive Shopping

Our credit cards become our lifeline for impulse shopping, feeding our dependency. The snowball effect leads to the piling up of high-interest debt; interest rates hover around 20-30% a year, if not more, on those “must-have” deals! With hardly anything left at the end of the month, saving becomes an unrealized dream for retirement and our kid’s college. We end up working until we die.

Our kids model our behavior and will do as we do, if we want a better financial outcome for our kids, it is essential to break this impulse shopping habit.

This accumulation of “stuff” leads to clutter in our homes. Countless studies have revealed that homes filled with stuff increase stress, anxiety, and depression. This depression and anxiety from clutter feeds the cycle again.

The Actual Costs of Using Credit Cards

There are two types of debt:

• Smart debt – your mortgage, education (if the degree will cover the cost of the education), a primary car loan (if not excessive).
• Dumb debt – credit cards, car loans for a second or third car that is only driven on the weekends.

When we use credit cards for impulse shopping (dumb debt):

• We pay annual interest rates as high as 20% – 30%.
• Interest that compounds over time means we pay interest on the interest!
• Minimum payment traps, never paying off a credit card.
• Hidden charges and fees.

Hidden Costs of Your Shopping Addiction.

Impulse purchases have long-term consequences, including:

• Loss of retirement savings.
• Insufficient college savings.
• Lack of emergency funds.
• Limited investment opportunities.
• Compromised financial security.

Physical and Mental Burden

• An accumulation of “stuff.”
• Cluttered living spaces.
• Increase in levels of anxiety.
• Increase in feelings of depression.
• Feeling more stressed.
• We destroy our environment either through waste or the use of natural resources to make the “stuff” we buy but do not need.

Breaking the Cycle of Negativity

These steps will put you back on track:

• Recognize all spending triggers.
• Take the time to clean and declutter your home, including the closets, drawers, pantry, and cabinets.
• Create and follow a strict budget.
• Make debt elimination a number one priority.

Strategies for a Healthier Financial Future

• Only buy something after you check if you already have something similar that can serve the same purpose.
• Setting a regular decluttering schedule.
• Manage debts actively.
• Grow savings automatically.
• Seek helpful advice from (disciplined) family/friends or qualified financial planners.

While not easy, if these steps are followed you can join the millions of people that have unsubscribed, stopped text notifications and have made their mental health a priority by not overspending and buying stuff they do not need.