We have all been told to put a lid on our impulse buying habits. This is a sound advice. Unplanned purchases can ruin our budget. If you cannot follow your budget plan, that has the potential to ruin your chances of reaching your financial goals. In case you have saving goals or financial plans for the future, all of these can be ruined by one impulsive purchase. If you want to be wise about your money, you must learn how to curb bad spending habits – one of which is an unplanned expense.
If you think that this impulsive buying habit is a personal problem, think again. You are actually not alone in your struggle. According to a recent study done by CreditCards.com, 8 out of 10 respondents admitted to making an impulse purchase in the past. In fact, 7 out of 10 said that they did an unplanned purchase in the past 3 months. The location by which the impulse buying was done seemed to be more common in the store. This study mentioned that this particular buying habit is usually done to satisfy a selfish desire. Most of the time, the purchase is for the buyer – the younger the buyer, the more they prone they are to buying on an impulse. As they age, these incidents tend to decrease. It is also important to note that the more people earn, the more likely they are to be an impulsive spender of big-ticket items.
Ask yourself these questions before you proceed with an unplanned purchase
The thing is, it is impossible to completely go without an impulse buy in your lifetime. Even if you spent hours creating your budget or poring over your spending plan, you will end up forgetting something or making a spur of the moment buying decision. There are so many factors than can influence this spending habit. For instance, did you know that retailers spend a lot of money to make sure that you will make impulse buying decisions? According to an article published on WashingtonPost.com, indulgent businesses like chocolates profit from the impulse spending decisions of consumers. This is why you will see a lot of unnecessary but indulgent products in the checkout counter. The article revealed that it is Hershey’s plan to win back consumers and make them commit unplanned purchases. They have started conducting tests in 2015 and you can be sure that they will do everything to make you do an impulse purchase.
Apart from that, there are also situations wherein making an impulsive purchase is actually necessary. For instance, your child accidentally dropped your phone and you have to buy a replacement. This is an impulse buying decision that you cannot postpone.
When you are faced with an unplanned yet necessary purchase, there are a couple of question that you need to ask yourself first.
What are the reasons why you need to buy it now?
Start by asking yourself the reasons why now is the perfect time to make the purchase. Why can you not wait until you have included this purchase in your budget or spending plan? Is it because you chanced upon a huge discount in the store? Or maybe the product is hard to find? These are reasons that can justify your impulse buying decision.
What expense will be sacrificed to make this purchase?
The next question you need to ask yourself is the expense that will have to be sacrificed. If you are following a strict budget, you have to get this money from the funds of another category. In case the impulse expense is something that cannot wait until the next month’s budget, you need to sacrifice something from your budget now. For instance, you may have to let go of 5 morning lattes to meet this expense. Identify the item in your plan that will be sacrificed immediately to avoid going beyond your budget.
Will the purchase be worth ruining your budget?
Finally, you have to ask yourself, is this expense worth ruining your budget? Sometimes, you have set your mind to spend only a particular amount. You have to spend some time to revise your budget or compromise it. Are you willing to put it on the line and be in danger of overspending? Sometimes, these impulse buying incidents compromise our budget plan for the month. If you want to avoid that, then you should rethink this expense. However, if the purchase is worth it, then go ahead with it and stop stressing yourself.
How should you react after an unexpected purchase
At the end of the day, you need to stop obsessing about these small diversions because things do happen that result in unplanned expenses. Of course, we want to avoid these as much as possible. You want to keep this purchase from giving you additional worries. But if you know that you need this expense, it’s okay. Forgive yourself for giving into your impulse buying urges.
HealthGuide.org published an article that revealed how we are genetically programmed to collect and gather. In the early days, this helps our kind attract partners because the better you are at gathering and collecting, the more you can survive – and those in your family. This genetic makeup, in a way, justifies our inclination to make impulse purchases. The article discussed further how our social impulses make us want to compete with those around us. So in case you really need to make an unplanned expense, forgive yourself and let it go. While you are encouraged to have this mindset, that does not mean you will not do anything about your finances. There are a couple of tasks that you need to accomplish to make sure that this financial decision will not affect your budget too much.
Start by consulting your budget – immediately. As soon as you get home and pack your purchases, you have to look at your budget to see how it will be affected by the expense that you just made. By looking at your budget, you will find two options to help you minimize any financial damages.
Choose the expense that you have to sacrifice
First is choosing the expense that you can sacrifice. While there are expenses that you should never sacrifice in your household budget, there are a lot that you can forego. For instance, you can skip a couple of date nights and just spend some quality time at home. You can also choose to brown bag your lunch for a week to compensate for the impulse buying decision that you made.
Find a way to replace the money that was lost
The other option that you have is finding a way to replace the money that you lost. You can choose to work longer hours or you can opt to sell some of your stuff. There are various ways for you to be able to increase your finances so your budget will not have to go through a major overhaul. This is especially true if your impulse expense is quite expensive.
Once you have figured out what you will do to help stabilize your budget, there is one more thing that you need to do.
Relax and enjoy your purchase.
If you follow the normal rules of financial management like budgeting, you have to trust your judgement. You should trust that you had a strong grasp of your finance capabilities before you made your spending choices. As long as you do not make a habit out of justifying your unplanned expenses and if this is a rare event, it should be alright. You can let this incident pass.