Why do some people take their roles as consumers literally and consume and consume and consume—purchasing items they don’t need, splurging on silly gifts (for friends and themselves) without pausing to consider costs, hitting the mall whenever they’re feeling down or bored, and digging themselves huge amounts of credit card debt in the process?
People aren’t that dumb. It’s pretty obvious that overspending leads to financial problems. It’s also pretty obvious that very few people actually need to go shopping when they say, “I need to go shopping.”
So why is it that so many consumers are unable to control their spending habits? How come they can’t approach shopping and other expenditures with detached logic? How come we all seem to buy way more than we need, and some of us pay the price in more ways than one? Why can’t we be more rational about consumption?
To get answers, the Dallas Morning News talked to a handful of problem spenders, along with a few therapists and psychologists, to get answers. The main answer is that human beings are not entirely logical, rational creatures. Problem spending isn’t all that different from problem drinking or problem gambling in that many people get started in these activities—and then can’t control it—largely for emotional reasons.
Such as: They’re lonely. They want people to like them—to find them appealing, cool, fashionable, attractive, fun. They want to change the way they feel in a given moment, and/or they want to change the way they feel about themselves. They want their problems to disappear, if only for a little while. They’re stressed and feel the need to blow off some steam. They want to feel like big shots, like they’re rich. They want to feel some level of accomplishment and “reward” themselves—because no one else will. Basically, they’re unhappy, and they look to shopping, drinking, gambling, or any other number of habit/addictions to cheer them up.
And it works—to a very limited extent. Dr. Brad Klontz, a financial psychologist and author of Mind Over Money (see a Q&A about the book here), explains:
“Shopping relieves their stress … However, like with new toys on Christmas morning, the feeling quickly fades and is replaced by more stress and guilt as they are left to deal with the consequences.”
I guess Dr. Klontz didn’t get the best presents on Christmas morning—perhaps some unresolved issues here? Didn’t get that Han Solo action figure you wanted so badly? (Oh wait, that was me.) Any way, the point is that, no matter what your vice, and no matter if the high lasts 10 minutes or until your credit card statement arrives in the mail, after a bout of shopping, drinking, gambling, or any other sort of binge, the core issues that truly caused your actions will remain unchanged.
How do you know you have a problem? Again, if you could step back and look at your situation logically, you’d just know. But that’s impossible if you’re in the middle of the storm, so the Dallas News story offers a list of signs to watch out for, such as:
• Next month’s bills arrive before you’ve paid this month’s.
• You’re using cash advances to pay your bills.
• You’re hiding purchases from your spouse.
Yes, I’d say these would indicate problems. I’m not so sure of these other signs listed in the story, however. I’m thinking of:
• You frequently charge items that you used to pay cash for, such as gasoline or groceries.
Hey, I do this, and I do it to get 2% cash back for such purchases. I figure it’s money we would be spending anyway, and it’s better to get some cash back in the transaction.
• You have frequent arguments at home about money.
Wait, this happens in my home too. Maybe I have a problem? Though, truth be told, the arguments in my home usually involve children under the age of 7 who are demanding they need money to buy every damn toy they see on TV, in catalogs that come in the mail, on Internet banner ads, in newspaper circulars, and, well, you get the idea.
I tend to think of the problem shopper and the impulse shopper as someone who is young and naïve, but this is not necessarily the case. The leading anecdote in the story involves a 65-year-old woman who grew up poor and only got her hands on credit cards—13 or 14 of them—much later in life, and bought things mainly to impress people, even though she couldn’t afford them on a $32,000-a-year salary. What has she finally learned?
“If you spend each paycheck to the absolute max and you’ve gotten ahead of yourself with your debt, you can get yourself in trouble very quickly, and that’s what happened to me.”
Totally logical. Simple even. But again, no one digs themselves purposefully into debt that they won’t be able to pay off. It’s not a logical proposition. The woman bought stuff to make herself feel better. Did it work? Oh yes, she says:
“For five or 10 minutes.”