How to Curb Emotional Spending

Emotional spending usually happens when one has to make themselves feel better to ease their emotions.

American clinical psychologist, Sheila Forman, says that emotional spending helps many people feel better and that it is a long-standing coping mechanism. An emotional spender uses shopping- whether online, in person, or both- to soothe what ails them.

Dr. Forman points out that emotional spending is not about buying necessities but things that one doesn't need or even really want.

This habit is driven by feelings that could include tension and sadness, joy, and celebration. It is impulsive and done in the heat of the moment, usually.

Since 2020, lives have been dishevelled and in the process, anxiety has increased. Mental health experts have said that Covid-19 saw a rise in emotional spending.

According to Elisabeth Netherton, a psychiatrist at Mindpath Health and a professional who works with women struggling with spending, the pandemic was a significant stressor leading to worse mental health for a huge number of individuals since it reduced chances for other rewarding social activities apart from shopping.

Despite recovery signs, the post-pandemic hangover is still there and so in this article, we look at the following:

Understanding Emotional Spending

When you spend money based on emotions rather than because you actually need a good or a service, then it becomes emotional spending. Some people call it "retail therapy". Whatever the case, it is impulsive spending.

Or, to put it another way, your desires and emotions win out over your capacity to decide on the purchase more logically. Shopping, according to research, releases feel-good hormones like dopamine that improve happiness.

For many people, the entire shopping process—from searching for things or browsing through options to making a purchase, unpacking the product, and waiting for delivery—is enjoyable. This momentary joy is what drives emotional spending.

Clinical psychologist, Scott Bea, says that shopping can potentially have significant psychological and therapeutic benefits – provided it is done in moderation.

He adds that some activities like spending a few hours at your favourite boutique will give you a psychological and emotional boost.

Emotional spending usually happens when someone’s negative feelings are at their worst and we look at the triggers next. 

What are the Emotional Spending Triggers?

Understanding what motivates you to engage in the habit can be useful if you're trying to cut back on your emotional spending. The first step in kicking the habit is raising your awareness of your triggers.

Spending motivated by emotions is caused by:

1. Feeling like your life is out of control
2. Sadness
3. Anxiety
4. Social isolation
5. Jealousy
6. Boredom
7. Depression
8. Low self-esteem
9. Stress, including financial stress
   

How to Curb Emotional Spending

It's easy to rack up tonnes of debt quickly when you spend a lot of money on yourself in order to feel better. 

Even when you are doing well financially, unfettered emotional spending can spiral out of control leaving you exposed and at risk of falling into poverty. 

To avoid this, these five tips will help you control your emotional spending.

1. Being Aware of Your Habits (Triggers)

Understanding the root of any emotional expenditure is the first step toward reducing it. It is simpler to rein it in once you identify the situations that trigger your excessive spending. Then, seek out other strategies for overcoming a challenging emotional issue.

You can always ask yourself, "Why am I out shopping?" any time you go shopping.

Even if it occasionally seems out of your control, emotional spending is not always uncontrollable.

Tip: Instead of spending money on your emotions, think about engaging in inexpensive activities like cooking, exercising, knitting, reading, or journaling.

2. Limiting Temptation

Consider taking a step to reduce the chance that you'll be exposed to spending temptation. Work towards cutting out whatever tempts you to shop to satisfy your emotions.

Tip: If the mall serves as your Waterloo, go there no more than once or twice a year, or don't go at all and shop online. If it is online shopping, find a new pastime to occupy your time, such as learning to play the guitar, if internet buying or TV shopping is the issue.

3. Opting Out of Advertisements

Consider limiting the number and frequency of advertisements that you receive either by text, calls or by email. By consciously deciding to limit exposure to advertising, then you have reduced some pressure on yourself to spend.

The less aware you are of what is for sale, the less likely it is that you would have a "need" to purchase that thing.

Tip: You can opt out of receiving promotional messages from companies or your favourite store's product catalogues by unsubscribing from their mailing and text lists. There are even some applications you can use on your phone to block calls and text messages while you can spam emails that could get you spending emotionally.

4. Budgeting

While the idea here is to help us deal with emotional spending, making a sensible budget that allocates a small amount each month for new clothing, technology, or any other "wants" is a good place to start. 

You can try out some of the budget templates online for a start and adapt them to your liking. This way, instead of going cold turkey on your spending, you can wean yourself off slowly and within a budget.

Tip: Consider making an “emotional spending” budget which can help you control your impulsive spending because it will allow you to occasionally indulge yourself. But, this has to be a more deliberate decision where you can decide on a recurring monthly or weekly budget and then stick to it.

5. Adopting Other Coping Techniques

Replace any strong desire to purchase anything new with an item that makes you happy. Starting a unique passive income initiative or taking up a new sport are two examples. If you don't have many hobbies, come up with creative methods to treat yourself without becoming bankrupt.

Some of the healthier and more affordable ways to help with that feel-good could be:

• Taking a walk or jogging in the neighbourhood
• Spending time with a friend or family member
• Taking those long baths
• Watching a favourite movie or TV show

Tip: Instead of having a night out every week, you can substitute this with a themed night at home where you can ideally substitute the night out with a treat at home. Doing this will show you the options you have when it comes to dealing with emotional spending and saving money at the same time.

Wrapping Up

In addition to these tips, consider limiting impulse buys which is a big issue for many of us. These impulsive buys could be as simple as a pack of gum when checking out at the supermarket or an add-on in online shopping. Cumulatively, all the little items add up to our expenses over time.

Consider delaying the impulse to buy by waiting at least 24 hours or longer. Depending on the results of the waiting, decide if it is a purchase worth making or not.

What is the underlying cause?

Emotional spending, at its core, is a coping mechanism when in emotional distress. It is crucial to deal with the underlying problem even while finding strategies to cut down on emotionally-driven shopping.

If it becomes a struggle to curb retail therapy habits, consider getting professional help since this could be a symptom of a larger issue.