Impulse Buyer? Try These!
In the age of the internet and interconnectivity, many things are substantially easier than they were 15 years ago. The act of researching products, purchasing them, and having them delivered is so much more streamlined than many of our parents could have ever imagined. Additionally, you can access your bank account and credit card balances by simply pulling your phone out of your pocket. These conveniences have done wonders for speeding up the process of buying consumer goods, which is a good thing in many circumstances. However, some people might feel like they're spending too much on impulse purchases because it's so easy to make them now. Today, we are going to talk about how you can slow down those impulse purchases by creating barriers for yourself.
Before we jump into any strategies, it's important to know that personal finance is personal, and everyone's situation is different. The information that I'm about to share with you focuses mostly on creating rules for yourself and adding friction to make it harder to spend your extra cash if you're following the rules. If you have absolutely no self-control, then more drastic measures might need to be taken. The important thing is that you understand how you can better your spending habits and reach your financial goals.
Set a Spending Budget
When I talk to friends about ways that they can save money, many of them do not have a defined budget for themselves for impulse purchases. Budgets can work both ways; it encourages those who are spending too much money to limit it to a predefined amount, and it also encourages those who otherwise would not have spent the money to go ahead and spend what they've set aside for that purpose. If you find yourself constantly buying things you don't need or spending too much on impulse purchases, then setting a budget for yourself can be the first step in limiting that spending.
Make Certain Purchases in Cash Only
People tend to spend more money when they have a credit card because it's convenient, and because they don't feel the loss of a transaction when they get the card back at the end of the day. If you're the type of person who goes out to places that accept cash instead of your credit card, you can curb your spending by committing to only spending cash. By limiting yourself to only what's in your wallet, you are forced to choose how you spend the money or to not spend it at all. Additionally, having to go through your wallet and see how much money you have to spend on something can give you that much needed time to decide that the purchase isn't worth it.
Change Your Online Shopping Behaviors
Online retailers have spent millions of dollars figuring out how to advertise to you and make it easy for you to buy something. This is great when you actually want to buy something, but can make it difficult for an impulse buyer to resist getting that shiny new toy. If you find yourself spending online more than you should, try these strategies:
Delete Your Saved Credit Card and Password Information - Adding friction to the process of purchasing something online by having to put in your credit card information or password can give you time to reconsider your purchase. If you're especially lazy, it can deter you from making the purchase all together, especially if your wallet and credit card are far away from your computer.
Give Yourself a Shopping Cart Rule - Instead of buying something immediately as you see it, put it in your shopping cart and log off the website. Set a time frame where you will come back and review your cart before making the purchase (3 days is usually enough). If you still want the item after those 3 days, then maybe it's worth spending the money on, especially if the retailer sent you a coupon code for it. But you may be surprised at how different the item looks after you've had time to think about it.
The thought process behind both strategies is to take the convenience out of online shopping so that you can't easily decide to spend hundreds of dollars in 5 minutes. You can probably think of more ways to make it harder for yourself, try some out and find the combination that works best for you.
These are not the only strategies that you can use to stop yourself from making impulse purchases. If you are really committed, you could maintain credit cards with a lower credit limit or send up your bank account so that you only have access to a small amount of money for spending. The strategies that you end up using need to work for you. For some, setting that spending budget could be more than enough to stop them from making regrettable impulse purchases. Others might need to put all these strategies together to keep themselves from spending like this in the short term. Ultimately, I hope you learned a strategy today that can help impact some unwanted financial behaviors that you might have.