What Is Mindless Spending, and How Can I Combat It?
Mindless spending can include impulse shopping and spending money to feel better. Here’s how to stop this damaging trend.
July 7, 2022
It’s estimated that we make more than 35,000 decisions per day, on average. Many of these decisions are made automatically, without much conscious thought. But when unconscious decisions start to seep into our financial lives, we can start having problems keeping our spending in check.
So-called “mindless” spending is when we spend money to feel better, a product of stress spending, or simply spend money unnecessarily without much thought. With knowledge and tools, we can combat mindless spending. Here’s what you need to know.
What is mindless spending?
Mindless spending is simply spending money without much conscious thought. It might be buying something without thinking about whether you truly need it, spending money to feel better or letting shopping habits spiral out of control.
Essentially, mindlessness is the opposite of mindfulness. To understand fully, it’s helpful to consider the terminology.
“Mindless” means acting without concern for the consequences, or without much conscious thought. When it comes to spending, this means making purchases without thinking much about whether the purchase is necessary, or why you actually want to make the purchase.
“Mindful” means to be conscious or aware of something. When it comes to spending, this means being aware of why you want to make the purchase, and whether or not you truly need the item or service.
Example of mindless spending
Let’s dive into an example to help visualize how mindless spending plays out.
Jeremy tends to go shopping when he is feeling frustrated, sad or lonely. He buys clothing and watches, even though he has a large wardrobe and watch collection. He spends money to feel better, even though he knows the high is short-lived. Jeremy is engaging in emotional spending, a form of mindless spending.
Samantha tends to think mindfully about her purchasing decisions. She goes shopping occasionally, but only when she actually needs something — a new blouse for work or a dress for a friend’s wedding. Samantha is a mindful spender.
Why do people spend money mindlessly?
There are many reasons why someone might spend mindlessly:
Many of us spend without much conscious thought, simply because that’s what we’ve always done. Perhaps our parents or other role models spent recklessly, and we learned the behavior from others. Or, perhaps we’ve simply never taken the time to think about the reasons behind our spending behavior.
Spending money to feel better
You’ve surely heard the term “retail therapy.” When we make a purchase, our brains release endorphins (the “feel good” chemicals) and dopamine (the “motivation” chemical), leading to a temporary surge of good feelings. Nearly 20% of Americans experience some sort of mental health condition, and rates of depression and anxiety are on the rise across the board. For some, spending money becomes a way to cope with stress or mental health concerns.
In America, consumerism is ingrained in our culture. Many people spend money to try to keep up with others, or to appear wealthy. And often, this spending is funded by credit cards. Around 30% of Americans have at least $1,000 in credit card debt. We tend to copy the behavior of those we spend time with, so our external culture certainly can influence our spending habits.
How can you curb mindless spending?
Now that we know what it is, how can we stop it?
First, let’s cover the generic advice that you’ll see everywhere. While this advice is overused, it could be useful for some:
Spend with cash: By avoiding credit cards, you can reign in your spending to only what you can truly afford to pay for with cash/debit cards.
Pause for 24 hours: Before making a purchase, stop and think about it for 24 hours. If you still want it, go forward with the purchase.
Remove saved credit cards: If online shopping is your vice, it can be helpful to remove stored credit cards from your online accounts.
Now, let’s look at some more unique strategies that can help you overcome mindless spending.
Determine the root cause of your spending
Start by looking inwards. Do you know why you’re spending mindlessly?
Perhaps it’s because you’re stressed out at work, and you use spending to unwind. Or maybe you’re experiencing depression, and you use spending to temporarily feel better. It could be because you’re jealous of others, and are using spending to chase status symbols.
Whatever the reason, understanding the core motivator is important for changing your habits.
Consider seeking help
Seeking out a qualified mental health counselor can help you improve your mental wellbeing. A therapist can help you identify the things holding you back from feeling content, and can also help you change your habits when it comes to finances.
If you’re hesitant to try therapy, even just talking to a close friend or family member may be very helpful.
Gratitude is a powerful tool in countering negative spending habits. Next time you feel like you want to buy something, stop and think for a moment about all the things in your life that you are grateful for.
This could be people, things, or even experiences. By focusing on what you’re grateful for, you may be less inclined to seek validation through further spending.
Reflect on recent purchases
As you think about possessions that bring you joy, it can also help to reflect on items that don’t bring you any happiness.
Think about some recent purchases you made — that new sweater that you haven’t worn yet or the milk frother that you barely use. Did these purchases improve your life? Would you rather have the money back to use for something else?
It’s easy to get caught up in the thrill of making a new purchase. By reflecting on past purchases, we can start to break the cycle of mindless spending.
Consider opportunity cost
Finally, consider what you’re giving up by making a purchase.
Let’s say you typically spend around $200 per month on unnecessary purchases. What else could you use that $200 for?
Saving up for a nice vacation
Treating yourself or your partner to a nice date night twice per month
Investing the money for your retirement (did you know that investing $200 per month for 30 years would result in around $235,000?)
Supporting a cause or charity that you are passionate about
Ultimately, countering mindless spending can be achieved in several ways:
Creating “friction” to make purchases a little less convenient (i.e. using cash or removing saved credit cards from your accounts)
Identifying the underlying cause of your spending behavior
Reflecting on recent purchases
Considering opportunity cost
Everyone is different and everyone’s motivations for spending differ. But ultimately, we can all benefit from some self-reflection around our spending habits — particularly if spending is leading to debt.
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