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An unpredictable economy is making consumers miserable, leading to a rise in splurging on indulgences, reports The Seattle Times.During the recession, sales of “party list products” — cocktails, coolers, cosmetics and wine — declined, but “post-recession” they’ve made a comeback: In August, cosmetic maker Estee Lauder announced its strongest fiscal year in nearly a decade in North America.
“In a poor economy, at any given moment people are more likely to have problems with self-control than otherwise — because there’s only so far their self-control energy can be stretched,” Kathleen Vohs, a professor of marketing at the University of Minnesota, told The Seattle Times. “People have a limited supply of energy to put toward controlling their urges.”
In contrast, sales of standard, household items such as batteries, bleach, baby diapers, and socks, have fallen sharply—though they are the sales the economy needs to turn around.
One thing consumers can’t control? Food cravings. Cheesecake sales have shot up 22% within the past year, according to the research firm, SymphonyIRI data.
We’ve compiled some helpful tips to help you curb your impulse spending:
Track your money. Whether it’s coming in or out of your account, get in the habit of asking for a receipt. Of course this won’t stop you from overspending, but at least you’ll be able to recognise your habits which is the first step to changing them, according to the personal finance blog, Get Rich Slowly.
Carry cash. It’s hard to overspend limited funds. Since your compulsive spending is likely connected to your emotions, handing over cash will definitely hurt more than swiping plastic, notes Get Rich Slowly.
Avoid making small purchases. Ask yourself, do you need it? The next time a deal seems too good to pass up, question whether you’d buy it if it wasn’t on sale. If the answer’s ‘no,’ you probably shouldn’t buy it now or ever. These purchases tend to rack up fast, says The Nest.
Avoid triggers. Forget window shopping. Why look if you can’t afford to buy? Find another hobby. Also, take precautions to limit your exposure to advertising. If you’re not constantly flipping through the trendiest catalogue, you won’t be aware that those cute shoes are now in season.
organise your closet. If you see how much stuff you already own, you might realise you don’t need to go shopping, says The Nest. Don’t feel like organising? Distract yourself in other ways like spending time with friends or by watching a movie.
Trick yourself. Avoid impulse purchases by playing the “30-day rule,” which means every time you see something you want to buy, you’ll give yourself 30 days before making it yours, suggests Get Rich Slowly. If you’re still longing for it a month later, spend the extra bucks. If not, there’s one more item you won’t have to hoard in your home.
Keep your wallet away. It’s kind of like keeping your alarm clock away from your bed so you’ll have to get up to turn it off. Similarly, keeping your wallet away from your computer makes it harder for you to impulse shop online, says Get Rich Slowly.