Cash advice

Have you developed an online shopping habit in lockdown? Here are some ways to tackle emotional spending…

1 BUY! BUY! BUY!

One of the biggest trends of lockdown in the UK has been the rise in emotional spending. For many, online shopping – and the hit of dopamine from clicking buy – has become a coping mechanism and a way of relieving the monotony. Mintel’s January 2021 consumer behaviour tracker shows that 53 per cent of adults are shopping more online now than at the start of the pandemic. Data from Barclaycard, published in July, found Brits spent £40.6bn online on non-essential items during lockdown – about £770 a person. Takeaway food and drink were the most popular purchases, then clothes and plants.

2 THE TRIGGERS

Even the most financially savvy can struggle – and natural instincts may be to blame. Behavioural psychologist Dan Ariely, author of Small Change: Money Mishaps and How to Avoid Them, says the human brain simply isn’t hardwired to be good at money. But learn to recognise behaviours that lead to impulse spending and you’ll be on the way to becoming a financial pro.

3 FIGHT THE IMPULSE

If you’re struggling to get a grip on your spending – or you worry about a family member – there are simple lessons that can help. We are programmed to follow our emotions, says Dan. According to a study by Asda Money, 19 million of us spend for purely emotional reasons – after a break-up, retirement or dealing with a death… or a pandemic! It’s nature’s safety mechanism.

Imagine, he says, that you see a tiger at the edge of a forest. ‘Nature doesn’t want people to start thinking about cost and benefit… Nature wants us to just start running as fast as possible.’

4 COOL OFF

Following your emotions can make for impulsive spending. This is exploited by everything from adverts on television, to salespeople in shops, to the algorithms used by social media. How often have you browsed online for something, only to find a pop-up ad for the very same thing in your browser the next day? How often have you been so caught up in the rush to buy at the sales, that you end up with stuff you didn’t need? Try a cooling-off period. Will you still want it tomorrow?

5 SOLUTIONS

⬤ Instead of buying something immediately, see if you still want it in half an hour. The bigger the purchase, the longer you need to let that fizz of emotion settle.

⬤ Take a hard look at your bank statement every month for evidence of emotional spending. Are you, for instance, buying lots of clothes in the evening when you’re bored?

⬤ Use apps, like Yolt, that break down your spending into categories, so you can see exactly where your money goes.

⬤ Put rules in place to break habits, like no shopping after a glass of wine…