Have you ever bought something that you don’t really need? Well, not many of us can say no to this. At some point or another, we have all spent money on items we do not need but have not been able to resist the temptation of buying them. And then, regret follows.
Is there a way to come out of this? Indeed, there is. In today’s article, we will take you through some realistic tips and tricks that will keep your spending impulses in control. So, implement them and experience the joy of delayed gratification. Let’s begin!
What does impulse purchase mean?
To put it simply, impulse purchase is spending money without a plan. It refers to buying things that you do not really need. However, you instantly decide to buy just by looking at them because you are unable to resist the desire to own them.
The reasons behind impulse shopping are many. Sometimes, it is the consumer’s emotional attachment to certain things. Sometimes, it is also to uphold one’s status and prestige. And a lot of times, it is the discounts and deals on products that trigger a consumer’s impulsive purchase desires.
Impulse purchase is an irrational consumer behaviour which can negatively affect one’s financial position if not controlled. Since it provokes you to spend on things you do not need, you will have to compromise later on necessities. Hence, controlling such temptations and spending when required is one of the essential aspects of money management.
Tips to avoid impulsive purchases
Strategising your expenses is a significant component of financial planning. Planning your expenses well is the first step to saving enough to create more wealth. Hence, understanding and implementing these simple yet powerful techniques can contribute immensely to your financial journey.
You must have heard of the seven-day rule, which suggests waiting for seven days before buying anything apart from your needs. The seven days of waiting is your cooling period, where you realise if you really want to spend on it.
But, can you wait for seven days? If it feels too long, here are some more tips you can adopt.
It is a simple process of forecasting your future income and expenses. Creating a budget will help you ascertain the funds you will have at your disposal. It will also give you an idea of expenses that require immediate attention.
A budget can help you determine the approximate amount you will be left with after meeting your primary expenses. Being aware of this number will help you stay in check, every time you spend.
Besides forecasting your future commitments, tracking expenses regularly is equally important. It helps you identify where you spend the most so that you can consciously reduce it in the future.
Prioritising needs vs wants
Refresh your understanding of the basic economic concept of needs and wants.
Needs are necessities, while wants are desires. Needs are those items required for one’s survival, while wants are items that add comfort and luxury to one’s life.
Needs and wants differ from one person to another. For example, a two-wheeler vehicle may be a want for a college student but a need for a food delivery boy. So, ask yourself and make a list of all the things that fall under these two categories.
Being aware of the difference can help reduce your expenses on wants. Also, rank your wants. This way, you can start fulfilling your wants one at a time after meeting your basic needs.
Setting financial goals
Determining your aspirations about money is a vital step in building financial discipline. It helps you keep diversions away and stay focused on attaining those goals.
It is suggested to set short-term and long-term goals. A short-term goal could be a vacation or buying a phone or a laptop. A long-term goal could be to buy a house or a car. Achieving short-term goals motivates you to reach your long-term objective faster. Such goals channel your mind to avoid spending on things that you do not need.
Saving is a vital aspect of financial planning. It is the first step to start investing and building your wealth. Experts suggest developing the habit of saving as early as possible, so there is enough time for money to grow.
Saving strategies such as Systematic Investment Planning (SIP) and Recurring Deposits (RDs) help divert your funds into productive channels rather than keeping them as cash, which can stimulate behaviours like impulse purchases.
Become a mindful shopper
You must have heard of mindfulness in meditation. It talks about being aware and being in the moment. This concept is applicable in purchases, too, as shopping mindfulness.
It suggests mindful spending, where consumers are aware of what they need. They are also well aware of the fact that buying something beyond their needs cannot generate internal happiness. Such consciousness helps them stay away from impulse spending. However, developing an approach like this requires sincere effort and practice.
Creating shopping lists
Have you seen people make ‘to-do lists’ to organise their day? A shopping list is similar, too. It helps you organise and reminds you to stick to it.
However, given our wavering minds, we sometimes go beyond our lists. That is where the comparison shopping technique comes in handy. Look for the same item at different shops or websites before buying it. This can help you fulfil your desires at a lower cost.
Bid bye to credit card shopping
Using credit cards while shopping gives you the leeway to spend more money than you own. In such cases, it is quite natural that you fall prey to your instincts and end up spending irrationally.
So, the next time you go shopping, how about carrying cash or a debit card instead of your credit card? That way, you will not just reduce impulsive expenses but will also help yourself by avoiding credit card debts.
Setting spending limits
Set yourself a limit on how much you will spend every day, every week and every month. This helps you monitor and keep a check on your expenses. If you go overboard one day, ensure you compensate for it on another day.
Did you know you can set spending limits on your credit cards, too? This seems like a good way to control your impulse.
The 50-30-20 rule comes in handy while setting your limits. As per the rule, 50% of your income is for needs, 30% is for wants, and 20% is for saving. This way, you will not spend beyond 30% on your impulses.
Resisting marketing tactics
Marketing and promotional strategies, such as discounts, sale offers, goodies, etc., are offered by brands to attract more consumers. We are humans after all, and most of us take the bait.
Yes, it is quite hard to resist attractive offers, but the simplest way to do so, is to unsubscribe yourself from all the emails and messages the brands send. A click is all it takes, so click and take control.
Look for a shopping partner among your family or friends. Tag along with your partner and be accountable for each other’s shopping. Always remind each other to ask questions before impulse purchases.
While impulsive purchases seem attractive, the happiness is temporary. Guilt usually follows. So, it is best to take precautions to prevent impulse shopping instead of regretting it later. Improving your financial awareness, evaluating your purchase decisions and analysing your spending patterns can help you stay in check and save money for other valuable purposes.