From a historical standpoint, consumerism is actually a relatively new phenomenon in the American way of life. It emerged in the post-WWII 1940's when the Great Depression and the devastation of war were in the rearview mirror, jobs were plentiful, and salaries were higher.
In the 1950s, consumption was even seen as a patriotic contribution to the American economy. Today, consumerism is not only still alive and well but easier to indulge in than ever before.
All it takes is a credit card and an online shopping account to have pretty much anything delivered right to your front door. While there’s nothing wrong with using your money to buy things that make you happy, it’s worth taking a little time out to examine how the siren call of one-click buying is affecting your overall financial happiness.
Four Hidden Costs of Excessive Consumerism
1. Financial FOMO
While we’re all entitled to a little splurge every now and then, spending every last cent of each paycheck can have long-term consequences. After all, there’s nothing worse than being unable to afford attendance at a friend’s destination wedding or to book that dream vacation because you haven’t tucked away sufficient savings.
2. Debt and overspending
These days, credit card interest rates aren’t playing around. Before you make your next credit card purchase, ask yourself whether it’s worth paying 3x the price on the tag. Unless you can pay off your card in full on a consistent basis, interest fees alone can easily double or triple the price of each purchase.
3. Overindulgence may mask real issues
Make no mistake, overspending can be just as addictive as drugs or alcohol. If you use spending as a way to avoid facing life challenges head-on, it may be a sign of a deeper issue.
If you feel like your spending has gotten so out of control that your life feels unmanageable, it may be time to look into a program like Debtor’s Anonymous. The program is designed to help debtors and overspenders regain control through anonymous in-person, online, or telephone meetings.
4. The false promise of Consumerism
Our society promotes the idea that the more you have, the happier you’ll be. But psychology says that materialism can actually have a negative impact on happiness and overall well-being.
How to Promote Balance Over Binge Shopping
Much like anything else, achieving real financial happiness is largely about cultivating a sense of balance. Here are some tips that can help you break free from impulse buying and practice intentional spending.
Practice Delayed Gratification
As many of us know, the happiness you feel when you swipe your card at the mall has a way of vanishing quickly when your credit card statement arrives. Set aside a certain amount of time, whether it be a few weeks or a few months, to try delayed gratification.
Each time you’re tempted to spend money on anything but necessities, take 24 hours to think about it. You’ll be surprised how many purchase ideas you end up forgetting about entirely.
Set Aside a Limited Spending Budget
It’s one thing to wait 24 hours before you buy another pair of shoes you’ll wear exactly once. But what if you just want to go out to Starbucks with your friends?
Rest assured there’s no need to wait a full day to purchase a latte. Try setting aside a certain percentage of “want” money with the 50/30/20 plan.
The plan advises dividing your paycheck into three spending categories. The first 50% goes to rent/mortgage and bills, while the last 20% goes toward paying off debt and saving.
The middle 30% is the “wants” category, which you get to spend on things like entertainment or pumpkin spice lattes with your pals. The idea isn’t to stop spending money on fun things altogether, just to make sure you do so responsibly.
Set Your Sights On Bigger Goals
Saving money doesn’t always sound like fun, but it can be if you come up with a fun reason to do it. Identify a goal, whether it be a dream vacation, a new car, or a great piece of furniture, and start saving with your goal in mind.
You might even take the time to create a vision board that helps you keep your eye on the prize. The next time you encounter temptation, weigh the fun of making an impulse buy against the fun of tanning on the beach in the Bahamas (or whatever your goal may be).
Try a Saving Challenge
Considering how much money most of us spend on junk, it’s ironic how intimidating the goal of saving can be. Test out how much you could be saving by completing a savings challenge.
You could even make one of your own — each time you successfully avoid an impulse buy, tuck away the money you would have spent in a savings account instead. Not only will it be eye-opening, but it will also help you put back money for a carefully selected purchase that will likely make you a lot happier in the long run.
Put Saving on Auto-Pilot
We get it — it’s not always easy to remember to take time out of your day to think about saving. That’s why we developed Spave, a free app designed to put saving and donating to your favorite causes on autopilot.
When you link the Spave app to your bank account, it will round up the spare change from every purchase you make. You can specify how much you’d like to go towards savings or even donations to the causes that matter most to you. Today, you can sign up to stay in the know while we improve the app.
