New Study Sheds Light On Spending Habits

We’ve all been there- we pop out of the office at lunch and the lure of a new pair of shoes or CD proves too much and we come back to the office with a new purchase, or after a stressful day we hand over the plastic and are perked up by a new purchase.

But we all know the pleasure those items give us is quickly dented, when the credit bill arrives or we check our bank account and are confronted with high overdraft fees. Then to cheer ourselves up we may even head back to the shops and spend even more.

A recent VitalSmarts study saw children being told they could earn some money and were asked how much they wanted to save and how much they were going to spend. They were then introduced into what VitalSmarts described as an impulse rich environment, with bright advertising posters, and samples of different sweets

The children were allowed to purchase sweets ‘on credit’, with the amount they spent deducted from the money they were going to earn in the future- to recreate the scenario of adults making payments on credit.

The average amount that children intended to save was 87% of their future earnings, but once confronted with the buying room they actually saved on average 32% of the money they would earn, indicating the effect the buying environment and their impulsive wants have on the buying process. the power of a buying environment and how impulse is a huge factor in the buying process.

These figures reinforce the situation many adults are in when they shop. We set a budget and have all the will in the world, but once confronted with all the lovely products and all the other factors that encourage us to buy, our budget goes out of the window and we are overcome with the need to buy.

Avoiding the shops at all costs is the best way to break the pattern, but this is something which most of us can’t do, as there are necessities we need to purchase. A more realistic method is to take a friend shopping with you and instruct them to keep you within your budget. Choose a friend who won’t get sidetracked and explain to them what your budget is and why it is important you stay within it.

Another tip is to reward yourself with small purchases every now and then, to give you a more motivation. If you cut out non necessities completely then it’s likely you will crack and end up on a shopping spree, whereas by planning some of your budget to be used for treats your more likely to achieve your goals.

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