Understanding Spending Makes it Easier to Save More

Spending and savings are opposites sides of the coin. The more you spend, the less you can save.  We spend to buy the things we need: food, clothes, shelter, transportation, education, communications. But most of us spend far beyond life’s basic necessities. We buy everything under the sun, whether we need it or not. We even buy things we don’t want.

We spend for five basic reasons:

  • We buy the things we need to live.
  • We buy the thing we want.
  • We shop to pass time with our friends and have fun.
  • We shop to relieve stress.
  • We buy to impress others and to bolster our self-esteem by associating with cool lifestyle brands.

When shopping is your preferred form of recreation, therapy, or esteem building, it’s easy to spend too much. Although you may shop for pleasure, overspending almost always has a contrary effect, especially when the credit card bill arrives.

News Flash: You’d don’t have to spend a lot of money to realize the recreational and therapeutic benefits of a trip to the mall. The rewards can be inexpensive or even free. You can socialize with friends over a cup of coffee and satisfy your shopping urge without emptying your wallet. As a matter of fact, you’ll derive more pleasure from several small splurges than buying a fancy espresso machine or home entertainment center. Due to something psychologists call “hedonic adaptation,” no matter how good they make you feel at first, you’ll stop appreciating them over time. As you grow accustomed to having them in your home, they’ll fade into the background and you’ll drift back to where you started emotionally.

The best way to extend the shopping high is to buy a few inexpensive tchotchkes every now and then. Buying a $12 T-shirt will trigger the same shopping high as a $600 pashmina shawl without the anxiety producing side effects of mounting credit card debt. And next week you’ll be able to extend the pleasure, without breaking the bank, with another $10 or $15 splurge.

If you’re a status shopper, it will be harder to break your big spending habits. You could buy a pair of sunglasses at the drugstore, but you really want the Ray-Bans which cost five times more. Although the drugstore glasses will shade your eyes from the sun, you’re emotionally driven to pay more for the status brand.

Advertising has us chasing cars and clothes, working jobs we hate so we can buy shit we don’t need.

  • Tyler Durden, Fight Club, from author Chuck Phalanuick

While the soft leather, brushed chrome, high resolution, mega-gigabyte features of high-end products will continue to appeal to our senses, less can be more in an overcrowded world of limited resources and climate change. Today, we are transitioning from conspicuous to conscientious consumption, from wasteful to sustainable lifestyles, from living large to living smart. Reusable shopping bags have become the new status symbol of an intentional lifestyle, and brown bag lunches are back in style.

The good news is you can assert yourself as smart, fit, and environmentally aware without overspending on expensive brands. You can actually say more about yourself and achieve a better quality of life, free from credit card debt, by spending less and saving more. Reducing your financial stress, you’ll enjoy better physical and fiscal health.