ACCC offers strategies for controlling spending that's driven by emotion
Boston, MA – May 30, 2023
Impulse spending has never been easier and more tempting. Consumers in the U.S. and worldwide have instant access to tens of millions of products through smartphone shopping apps such as Amazon, eBay, Etsy, and many more.
But the cost of buying on impulse or because of emotion instead of need can far outweigh the satisfaction of a purchase made in haste or on a whim. The average American spends nearly $1,500 per month on non-essentials, according to the business and marketing consultancy BusinessDIT. And the financial services provider LendingTree found that nearly 40% of Americans have admitted to overspending to impress others or appear successful.
Counselors at American Consumer Credit Counseling, Inc (ACCC) often advise clients on ways to control overspending as part of an overall strategy for better financial health.
“Better awareness of what you are buying and applying self-discipline are the best tools to avoid impulse spending and keep discretionary expenses in check,” said Allen Amadin, President and CEO of American Consumer Credit Counseling. “We coach our clients and others to make deliberate buying choices that align with your long-term goals.”
Here are five strategies that ACCC recommends to help control impulse purchasing:
- Create and Stick to a Budget: The first step to gaining control over your spending habits is to establish a realistic budget. Start by assessing your income, expenses, and savings goals. Allocate a specific portion of your income for discretionary spending on non-essential items. By having a clear picture of your financial situation, you’ll be better equipped to make informed decisions and avoid impulsive purchases that may strain your budget. Remember to periodically review and adjust your budget as needed to accommodate changing circumstances.
- Set Priorities and Define Needs vs. Wants: Understanding the difference between needs and wants is essential when it comes to controlling impulse spending. Before making any purchase, ask yourself if it aligns with your priorities and whether it is a true necessity. Differentiating between essential and non-essential items can help you resist impulsive urges and focus on what truly matters. Consider implementing a “waiting period” before making significant purchases. This practice allows time for reflection, helping you determine if the desire is genuine or merely a fleeting impulse.
- Practice Mindful Spending: Mindfulness can be a powerful tool in curbing impulsive spending habits. Instead of mindlessly swiping your credit card, take a moment to evaluate your motives and the potential long-term impact of your purchase. Ask yourself if the item will bring lasting value or if the joy it provides will be short-lived. By cultivating a mindful approach to spending, you can reduce the temptation to splurge on items that won’t contribute to your overall well-being and financial stability.
- Avoid Triggers and Temptations: Recognizing your personal spending triggers is crucial in combating impulse purchases. Whether it’s visiting your favorite shopping website, entering a mall, or even seeing advertisements, identify the situations that tend to weaken your self-control. Limit exposure to these triggers by unsubscribing from marketing emails, avoiding window-shopping, or finding alternative activities that don’t revolve around consumerism. Additionally, consider implementing a “cooling-off” period for online purchases, adding items to your cart but delaying the checkout process. Often, this pause is enough to break the spell of impulsive buying.
- Track and Review Your Expenses Regularly: Monitoring your spending habits is an effective way to stay on track and ensure your discretionary expenses remain within your budget. Use personal finance tools or mobile apps to track your purchases and categorize them accordingly. Review your expenses periodically, examining patterns and identifying areas where you may be prone to impulsive spending. Being aware of your spending habits allows you to make more informed choices and adjust to prevent future budget breaches.
About American Consumer Credit Counseling
American Consumer Credit Counseling, Inc is a non-profit 501(c)(3) credit counseling organization that is dedicated to helping consumers achieve financial management through various debt solutions, such as credit counseling, debt management, bankruptcy counseling, housing counseling, student loan counseling, and financial education. With the goal of empowering consumers to reach debt relief, ACCC provides a wide range of free personal finance resources that cover topics such as budgeting, credit and debt management, student loan assistance, homeownership, identity theft, senior living, and retirement. By using ACCC’s tools, such as worksheets, videos, calculators, and blog articles, consumers can make informed decisions about their financial future. ACCC has an A+ rating with the Better Business Bureau and is a member of the National Foundation for Credit Counseling® (NFCC®). To learn more about ACCC or to access their free financial education resources, visit ConsumerCredit.com.
