|Art Graham has an MS Degree in Accounting and has worked in Accounting and Finance
for close to twenty years. He enjoys the field of personal finance and enjoys
bringing good money saving advice to people on the internet. He is also an
expert in the field of Accounting and Manufacturing Software. For more great
tips on saving and cutting costs, check out his website,
In order to control your unnecessary spending, it
helps to understand why you spend. Spending money is often not the problem, it
is often the symptom of something else. Let's take a look at three reasons
people spend money and see if we can find ways to control them.
When I was in grad school, I was sitting in an
accounting class one day, and Vicki, who sat in front of me, turned around and
asked me how my day was going. I said 'Oh, fine, except that I spent way too
much money this morning on cd's.'
'Yea, I used to spend too much too, while I was
working' said Vicki.
I thought about this for a second, and then I
asked, 'Why did you spend more while you were working?'
I could have sworn she would have given me the
standard answers like:
'I needed new clothes to look good' or 'I had to
find babysitters' or 'I needed a new car to impress my clients' or 'I always ate
lunch at a restaurant' all of which are indeed, valid reasons you might spend
more while you're working. But, no!! What she said was 'I wasn't happy and I
always spend money when I'm not happy.'
At the time, I just shrugged it off as 'Oh that's
interesting... How's your thesis coming?'
In other words, I didn't give it a thought.
But that was years ago...
Then one day, I was feeling depressed and went to
the mall and started buying stuff I didn't need or really even want. Then it
dawned on me...Vicki was right! It took her a lot less time to realize why she
spent money than it did me. I'd always assumed that since I'm not normally a
melancholy type person, I wouldn't / didn't suffer from that same fate. But the
truth is, even I spend money when I get sad or lonely. The difference is that
now I recognize it. The truth is, people spend money because they're sad, and
spending money on clothes, a car, makeup or whatever it is really can, for a few
minutes make you forget whatever it is that is making you sad. It sort of
'brings you out of yourself' and transports you to another place. In simpler
language, it makes you forget about yourself for a few minutes and helps you
think of some other object or subject.
The real problem here is not your spending, but
your sadness; if you can solve that issue, then the unnecessary spending will
stop (or at least slow down).
Not being a psychologist or a therapist, I can't
really offer any professional advice, but one thought has occurred to me.
The real reason spending helps you feel better
while you're sad, is because you forget about yourself or your problem. It seems
to me, then, that you should do something to help you forget about yourself or
your problem, other than going to the mall. Try working on a hobby or developing
one if you don't have one. Go to a movie. Take a walk through a park. Go for a
run. Visit a nursing home. The bottom line is try, with all your might, to do
something productive. Wash your car. Call your mother. Create a web page or a
blog. Do something to 'forget about yourself' for a while.
Another reason people spend unnecessarily is what
the economic whiz bang kids call 'impulse buying'. Sadly, I see it in myself
too. The other day I was in the grocery store, eyeing all the candy in the
checkout lines. I was reaching for an Almond Joy, when that good little voice in
my head said 'Whoa, dude!! Did you come here for an Almond Joy?'
'Well, no' I said. 'I came here for a loaf of
bread and some milk'
'Well then... what the heck are you doing?' said
that little voice.
'Oh, I don't know' I said. 'Maybe I want to enjoy
myself, for a change!'
Anyway, surprisingly, my little voice won. I put
the candy bar back and realized what I was doing. Those marketers in the store
are smart. They know that if they put that candy in the aisle where we checkout,
that a large percentage of us will reach out and touch!
The way I combat these marketers now is by
training myself to recognize it when I see it. If you can recognize when you are
being manipulated, it is much, much, much easier to resist. Why, the nerve of
those marketers! So now, instead of letting your mind wander while you are in
the checkout aisle, start thinking things like 'Hmmm, I wonder why they put
Almond Joys in the checkout line?' 'I wonder why they put that special display
at the entrance to the store?' 'I wonder if they did that to get my money or
because they really care?' Try to recognize when you are being manipulated.
Finally, a third reason that people spend money
unnecessarily is because they are bored. Once again, I see it in myself. If I
have nothing to do, my first thought is, 'I know! I'll go to the electronics
store and check out all the new fancy, shmancy stuff.'
I know this will come as a shock to you, but I
really don't go because I want to find out what new products exist or even to
learn about them. No, sadly, I go ONLY because I'm bored. Now, going to the
store when you're bored is not what you should do if you're actually trying to
save money or reduce your spending. Why, you ask? Because it is putting yourself
in 'harms' way, economically speaking. If you don't want to eat poison, don't
put it in your food pantry. If you can't swim, don't jump in the ocean. If you
can't resist all the glitzy, appealing and attractive merchandise, don't go to
the store. Recognize that you're bored and address that by some other means.
Call up a friend. Work on your household budget. By now, you get the idea. Do