Have you ever popped up to the shop to buy a carton of milk and ended up with a whole shopping trolley full of unwanted groceries? Or perhaps you went to your local shopping centre for a birthday card and came back with a plasma screen TV, a top-of-the-line barbeque or a whole new wardrobe.
Impulse shopping – we’ve all done it. We see it, we want, and we buy it. And the worst part is, we usually regret it. So not only can these purchases break our budget and put us into unnecessary debt, but they often make us feel makes bad too.
The truth is retailers and marketers spend a lot of money investigating the psychology of spending, and use advanced methods to tap into your emotions and encourage impulse buys.
But the good news is there are some simple things you can do to greatly reduce impulse buying. Here are our tips to help you stay on track, and beat the retailers at their own game:
Make a list and stick to it – Keep a list of items you need on your next trip to the shops, and follow it religiously. This will help you stick to the right aisles and stop you from getting distracted by carefully placed sales signs and displays.
Follow a mandatory waiting period – When you see something you’d like to buy, rather than buying it on the spot, force yourself to think about it for a week. This will give you time to decide if the item is something you really need, or alternatively forget about it altogether.
Avoid shopping on pay-day – Most people feel richer on pay day, and are more vulnerable to frivolous purchases. Try to wait a week before buying any big ticket items.
Walk to the supermarket – If you only need a handful of things, why not walk to the supermarket? If you have to carry your groceries home, you’re less likely to buy things you don’t need.
Pay in cash – Numerous studies have shown that when people pay in cash rather than using credit card, they tend to spend less. This is because psychologically, using cash makes spending more real and the money harder to part with.
Shop less often – It sounds obvious but the more often you go to the shops, the more chances you have to make impulse buys. So cut-down on the frequency of grocery shopping, and avoid window-shopping altogether.
Wait for second generation gadgets – When it comes to buying the latest high tech gadgets, it makes sense to wait. Most technology decreases in price after it is initially released. And better yet, later versions usually have fewer bugs and better capability.
Focus on your goals – Knowing what’s important to you and what you really want to achieve with your money will help you from getting distracted by short-term wants. So spend some time thinking about your goals, and creating a plan to help you achieve them.
At ipac, we believe the goal of financial planning is to manage your wealth to create a happy and fulfilling life. We can help you discover what’s important to you, cut-back on unnecessary spending and focus on your authentic long-term goals.