Profitt Report: Are your emotions impacting your spending?
We usually think of money as cold and calculated but a new survey finds our money-spending habits are anything but unemotional. Keeping a budget means staying focused and logical but NerdWallet just did a survey and found strong emotions will cause many of us to pull out our credit cards.
“There's a lot of psychology there,” said Sean McQuay with NerdWallet, whose survey finds nearly half of Americans say emotions cause them to spend more money than they can reasonably afford.
“We did find a difference in gender,” McQuay said, “so women tend to overspend when stressed and men tend to overspend when they're feeling excitement.”
Younger adults said they’re more likely to overspend due to emotions than older adults according to the survey. McQuay said shopping on Amazon is his go-to emotional spending response but he has a trick to help him keep his spending in check.
“Most things, I make them sit in my cart, my online checking cart for a couple days before I hit check out and that lets me think about it, my cool off period,” he said. Then, if McQuay still wants it in a few days, he buys it, knowing he truly wanted the item.
Another idea, he suggests setting aside a little money each month just for an emotional occasion.
“You can call it your slush fund, I don’t know what I’m going to do with this but sometime when I’m really angsty or excited, this is where my money is coming from, that's fine,” McQuay said.
To read the survey, please click here.
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