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Key takeaways:
- We’re all guilty of impulse buying, but it can be hard on your finances.
- Emotional shopping, being influenced or manipulated into making a purchase, or simply not planning ahead can lead to impulse buying.
- By budgeting for impulse purchases, you will allow yourself to still have fun while protecting your budget.
Let’s be honest, because we’ve all done it ... gone into the grocery store or the warehouse club, and suddenly an extra item jumps into your cart. Or you stayed up late one night web surfing, and then a box magically arrives on your doorstep. Whether it’s a ‘deal just too good to pass up’ or something you didn’t even know you needed but just had to have, impulse buying can put a big dent in your finances.
What is impulse buying?
Regardless of whether it’s a written shopping list or a mental note, most of us plan our purchases on some level. But when you order something online or walk out of the store with something that simply wasn’t on your mental radar, it’s called impulse buying—making an unplanned purchase.
There are a lot of reasons we make impulse purchases. Some impulse buying is emotional—you’re bored or hungry, or you’re envious of your friend’s new coat. Another cause is influence, whether you’re following someone online, targeted by advertising, or just getting lured in by an overzealous salesperson. And sometimes it’s just from a lack of discipline over finances, a failure to separate wants from needs.
When you don’t have a plan to manage your budget, much of what you buy becomes an unplanned purchase. And in no time at all, your budget is busted.
Why should you avoid impulse buying?
Lack of control over purchases can quickly derail your finances. When you shop intentionally, that is, when you thoughtfully buy only items that you actually need or planned for, you will be much better able to stick to a budget. And when you avoid impulse buying, you are also better able to manage your credit card balances, since you’re not surprised by how much you owe each month.
Some of us just love to shop, and that’s okay. But if you’re shopping because you’re having a bad day (often called retail therapy), if you’re motivated to buy something because it’s on sale, or if you find yourself at the mall because you’re bored, take a step back.
8 Ways to prevent impulse buying
Overspending can be stressful. Here are eight ways to step away from impulse buying.
1. Make a budget—which includes ‘fun money’—and stick with it
A budget is your roadmap to financial success because it gives you a spending plan with specific limits. It’s healthy for you to give yourself permission to spend freely, as long as it’s for planned, budgeted purchases. This moves your purchasing decisions out of the ‘impulse buy’ into the ‘planned purchase’ category, which protects your financial goals. Some people think of a budget as a buzzkill, but it can—and should—include a line item called ‘fun.’ When you plan for fun purchases, it actually helps prevent binge shopping.
2. Pay yourself first
This budgeting strategy has you first set aside money for savings, such as retirement or an emergency savings fund, and then you pay for your ‘needs-based’ living expenses like rent or mortgage, groceries, and utilities. Whatever’s left over can then be used for non-essential ‘wants’ like dining out, travel, and others—including a ‘whatever’ budget for impulse purchases. You can get started on the ‘pay yourself first’ plan by automatically transferring a predetermined portion of your paycheck to savings; you’ll then get used to spending what’s left each month.
3. Identify your weaknesses (and curb them)
It’s time to hide the cookie jar. Do you fall for online ads? Are you swayed by influencers? Unfollow them or unsubscribe and remove the temptation. Some platforms even allow you to modify your ad settings or pay for an ad-free experience; just be sure the cost of the subscription is worth it. You may want to avoid the platform entirely or unsubscribe from tempting email. It’s also helpful to remove your credit card information from online stores because it makes you think twice about the purchase when you’re typing in the number.
Sometimes all it takes is to recognize the risks. Retailers manipulate you by stocking appealing impulse merchandise on end caps and near the checkout lines, so resolve to avoid picking up unplanned items in these areas. Or, if you find that things like shoes, tools, books, or sporting equipment jump into your cart, you may also try avoiding those types of stores altogether.
4. Shop with an agenda
You’ll be surprised how helpful a plan can be. For example, check your pantry, set a meal plan for the week, and then build your grocery shopping list around that. Besides focusing your grocery purchases, this approach will also help you save money on take-out, drive-through, and spur-of-the-moment dining out. It’s also a good idea to plan for gift giving. For example, decide up front how much you want to spend this year on birthday gifts. Track your expenses for each person and stop spending when you reach their limit. If you struggle with impulse purchases in the big box stores or the warehouse clubs, make a list first and then vow to stick with it.
5. Don’t shop hungry, angry, lonely, or tired (H.A.L.T.)
Emotions have been proven to be closely tied to impulse purchases. Check your mood before making a purchase to be sure the item is necessary and not a reaction to how you’re feeling. For example, many online impulse purchases are made late at night by people in bed on their phone. Help yourself out by vowing to leave items in the cart until morning. Giving yourself this extra time will help you cool your purchase. Delete shopping apps from your phone. When you must visit the store’s website and log in, even this little bit of extra effort can give you reason to pause. And if you’re prone to entertaining yourself by shopping, look for something else to fill your time. Go for a walk, pull some weeds in your garden, or watch a favorite movie instead.
6. Leave your impulsive friends behind
At the store, that is! It’s a good idea to talk about your challenges so people can support you along the way. If impulse shopping is a problem for you, shop only with a responsible buddy, someone who supports you and your financial goals. Step away from social media for a while and remove retail apps from your phone if you struggle with impulsive online shopping.
Another tactic is to just use cash. For example, do you find yourself spending more at restaurants because your group wants to split the bill, even though you limited yourself to a salad? Let them know up front how much you plan to spend and use your limited cash as an excuse.
7. Try a no spend challenge
While this can be a good way to teach yourself discipline, you can also make it a fun game. For example, use the month of January to only eat food you already have in the freezer or pantry instead of buying new. Stop dining out during the month of July and spend more time barbecuing in the backyard. Step away from getting pedicures from October through April. Avoid the mall for a month or compete against yourself or your friends to see who can go the longest without an online purchase.
Another tactic is to force yourself to get rid of something before you buy something new. For example, if you find a new sweater you think you want, resolve to first give an old sweater away before you can buy the new one. This delays the purchase, and makes you consider how much you really want the item.
8. Give it time
Time is on your side here. Put 24 hours between you and a purchase to let yourself consider whether the item aligns with your personal and financial goals. Often, all it takes is to step away from the item for a bit to help put the purchase into perspective. Avoid being manipulated by a ‘limited supply’ or a ‘sale ends tonight’ message. These are common sales tactics; just don’t fall for them. Maybe even consider imposing a mandatory 24-hour waiting period on all purchases over $100 to give your money some breathing room.
A better approach: planned spontaneity
It’s okay to leave room in your budget for impulse purchases; call it ‘fun money’ for this reason. But unplanned impulse purchases, even if they feel small at the time, can add up and derail your long-term financial goals. Do simple things—set savings goals and spending limits—to help you avoid impulse buying and buyer’s remorse. Add a line item to your budget just for the fun stuff, and then stick to the limit. Be thoughtful and deliberate when you’re shopping; think twice about an item and refuse to be manipulated into buying something you don’t really need.
Give yourself the freedom to make a few frivolous purchases along the way but know that managing your debt and keeping yourself on track financially will help you feel even better in the long run.
