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Emotional spending: What it is and how to overcome it

Mediafeed logo Mediafeed 6/26/2019 Cheryl Lock
a woman holding a colorful umbrella: Woman shopping© DepositPhotos.com Woman shopping

If the lamp on your desk, the mirror above your daughter’s changing table and those trinkets in your kitchen were all purchases made after a particularly stressful situation, you might be an emotional spender.

And you’re not alone. In a 2017 survey by CompareCards.com, a fellow LendingTree company, about a third of shoppers pulled out their credit cards in an effort to make themselves feel better. The instinct was even more prevalent for millennials — a whopping 48% reported buying something recently because they were feeling down, upset or angry.

What is emotional spending?

Emotional spending is, as you might have devised, the act of buying things with the motivation to make you feel better. Colloquially, it’s often referred to as retail therapy. “I think emotional spending is very common,” said Megan McCoy, an adjunct faculty member for Kansas State’s Financial Therapy Certificate Program and secretary on the Financial Therapy Association’s board of directors. “Anecdotally speaking, I think we saw a marked increase in this type of spending with the rise of online retailers — especially when free shipping and free returns became a thing. Emotional spending increased then because it became so easy.”

When it comes to emotional spending, it’s important to keep in mind that there’s a difference between compulsive spending and spending money every now and then because it gives you a burst of happiness. As opposed to emotional spending, compulsive spending is a disorder where spending has become a customary way of achieving self-esteem or is done to escape reality, and it often interferes with a person’s responsibilities or relationships. It’s best to consult an expert for help if you think your spending has escalated from being prompted by emotional triggers to compulsive behavior.

The root cause of emotional spending

Since emotional spending is the act of buying things to make you feel better, the spending itself is often triggered by something personal that charged you up. Of course, these triggers can range dramatically based on your personality and individual circumstances, but Dr. McCoy said that common triggers for women include relational disturbances (aka fights with a partner or other loved ones) or feelings of loneliness (aka feelings of being unloved or undesirable). Those emotions in turn cause feelings that make us want to spend since we could be thinking that once we buy those jeans or that new makeup, we’ll look different or be loved, she said.

While Dr. McCoy said that a man’s emotional spending is more likely to be fueled by reasons having to do with success (or feelings of inadequacy when it comes to success), for both men and women, emotional spending may not necessarily be something that they are even aware they are doing. “Emotional spending can be an unconscious power trip,” she said. It’s often fueled by a desire to do something that proves a person can make their own decisions and do what they want.

How to break the emotional spending cycle

A habit is, by definition, something that is hard to give up, and if you’re an emotional spender, moving away from the tendency to spend money when you’re feeling emotional can be a difficult thing. On the other hand, emotional spending is often a consequence of impulse rather than thought, Dr. McCoy added, and “by recognizing that this has been a pattern of coping in oneself, you can find other ways of coping and stop emotionally spending quite easily.”

If you recognize yourself in the above description, there are a few things you can do to help break the emotional spending cycle.

1. Come up with a list of other coping techniques. Spending money might make you feel better in the moment, but chances are after you receive your credit card bill or realize your wallet is empty when you need to buy lunch, the feelings of guilt will set in. Instead, Dr. McCoy suggested putting a little thought into some other ways to blow off steam when you feel upset. “Find out what else makes you feel regulated,” she said. For example, maybe going for a run, listening to your favorite playlist or having a cup of coffee will provide you with the same rush that spending does. At the very least, it might cause you to pause long enough to realize that you don’t actually need to spend money to feel better.

2. Do the math. Something that works with spending in general is to take a moment to consider just what that new throw pillow will cost you, even outside of its monetary value. “My favorite trick is to always do this simple math when shopping,” Dr. McCoy said. “Whatever you want to buy, just figure out how many hours you will need to work to buy it. You want to emotionally spend on a cardigan that costs $75. You make $20/hour. Is that cardigan really worth almost four hours at your job?”

3. Have a budget. With a proper budget in place, retail therapy isn’t completely forbidden, which some people might find helpful. Create a budget that provides for some level of emotional spending within those constraints. That way, if you do find yourself feeling like you need to buy that cashmere scarf after the huge blowout you had with your sister, at least you will have factored that spending into your monthly budget.

If you need a little help putting a budget together, get started with our ultimate guide to budgeting, and learn about some of the best apps to help you maintain that budget.

4. Start a journal. Studies have shown that journaling has all kinds of amazing side effects, and helping you combat your emotional spending could be one of them. Dr. McCoy suggested creating a thought journal where you record the events that led up to a shopping spree, along with the actual shopping. “Thought journals are basically the cornerstone of cognitive behavioral therapy,” she said. “According to CBT, thoughts and behaviors are so intertwined that sometimes we can’t remember what came first.”

By using a thought journal to record your spending habits, you’ll be able to identify the anecdotes that caused your emotional spending so you can recognize what’s actually bothering you and work on fixing the root cause. “In other words, it allows you to identify the underlying problem and fix that, instead of just dealing with the symptom — shopping,” McCoy added.

5. Create barriers to spending. Emotional spending (and overspending in general) will be harder to do if you create barriers that make it physically harder to spend. For example, remove your credit card information from being cached in the websites where you frequently spend. Unsubscribe to emails from stores you love. Set a five-minute waiting period before you spend on any nonessential items.

The bottom line

At the end of the day, emotional spending can break the bank, and it doesn’t necessarily help you deal with your actual problem — whatever it was that triggered your spending in the first place. If your emotional spending has already put you into debt, you can learn more about the emotional toll of debt and how to tackle it.

These days, online shopping makes it easier than ever to spend, and social media makes it easier than ever to identify the Joneses we want to keep up with. Luckily, with just a few small steps, emotional spending doesn’t have to be a hindrance on your finances anymore.

This article originally appeared on MagnifyMoney.com and was syndicated by MediaFeed.org.

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