Are you an Impulsive Buyer?
Me: “Hey, I just bought this cool new speaker for my home where I can command it to play my favorite playlist!”
Friend: “Really! That’s awesome! Let me call you back in an hour”
Friend calling after an hour: “Dude, this speaker is so darn cool! I bought myself one too!”
If you are at home, stop for a moment and look around you. Notice something? Do you see the high number of gadgets, unworn clothes, your instant ab routine workout equipment and even that silly banana slicer! I presume you know my next question – When was the last time you used it? Think hard because your hard earned money was carefully chosen by you to make that purchase to enhance your life! The reason behind every purchase is often “This will be really useful for me”, without determining its value. It is this behavior that makes you an impulsive buyer that I often like to call a consumer of weakness.
If you find yourself compelled to buy into the latest trends, that eventually finds no place in your life, read on. Impulsive buying is like gambling, where you experience a spontaneous ‘buzz’ after buying something, only to last a short span of time until you un-box your new purchase, and are out again in search of your next ‘buzz’.
So you have been kidding yourself all along for your lack of control, but its not too late to end the joke on consumerism. What can you do? Do you need therapy? Of course not! Here’s a plan to keep your impulsive buying in check:
1. Y LIST
Your Y List comprises of all the urges that force you to rush to the mall and throw your money down the rat hole. It is called the Y List because for every item on it, you will be asking yourself the important question – WHY? Why do you need those pair of shoes, Why you MUST HAVE that new tablet or Why your old phone needs to be replaced to receive the same silly memes?
The answer to each question must be a logical rational explanation, thereby deriving awareness of your impulsive buying habit. Having urges is natural, but giving in to every temptation is a sign of weakness and you certainly don’t wish to be weak, do you?
2. MAKE A LIST OF YOUR REAL NEEDS
Sounds boring? Well, you have been making those impulse purchases pretty enthusiastically, so let’s try bringing some enthusiasm towards a better you. Identify and list your basic needs for an entire month. This list would comprise of daily necessities such as groceries, household supplies or your prescription refills. Anything that does not add value to your livelihood, such as the new pair of shoes on sale, must be added to your Y LIST.
Balance your budget
Practice this for 30 days and check the amount you saved with this tiny step. After a month reward yourself by giving in to a small temptation from your Y List, but don’t go overboard in doing so. Realize that this is NOT a 30 day challenge but a lifestyle change!
3. FREEZE THE PLASTIC
No you don’t have to put your credit cards in the refrigerator! If you find yourself possessed by your colorful shining plastic credit card, it’s time you ignore it for the time being. Call your bank and freeze the card until you have your spending in check. This will prevent you from making those unnecessary purchases each time you visit the mall.
Understanding the value of a single dollar is the beginning of your journey to conquer your weakness. By avoiding random purchases on your credit card, you could also save yourself from high amounts of credit card debt. You may also wish to read Plastic Money – when debt comes disguised as wealth!
4. DELAYED GRATIFICATION
Impulse buying is the simplest form of instant gratification. You go out, buy yourself a toy and you are a happy kid! But we are grown ups with grown up goals seeking a future of financial independence. So what do you do? Focus on delayed gratification, which implies postponing your feel good moments for a later date. Patience is a virtue, and this quality can take you a long way in achieving your financial goals.
The best way to do this is by setting a long term goal. For example, if you have always dreamed of traveling through Europe, and you know it can be an expensive trip, you would definitely wish to save your money for this dream trip as opposed to spending on something you really don’t need. Keep your long term goals in mind each time you have the urge to spend foolishly.
Don’t beat yourself up over it. It’s good to spend money on yourself once in a while. Yielding to temptations can have positive impacts on your life if it isn’t out of control. Being frugal isn’t about being cheap or depriving yourself of things for the sake of money. It’s about getting the most value out of things.
Be Frugal, Be Smart, Be Rich!